SEOUL, The head of the financial regulator said Tuesday there is a need for financial firms to improve their practices to sell risky products, a day after authorities found wrongdoings in selling derivatives linked to Chinese stocks.

“We continue to see mis-selling despite the enactment of the financial consumer protection act following the 2019 derivatives-linked fund (DLF) products incident,” Kim Joo-hyun, chairman of the Financial Services Commission, told reporters.

Kim said the commission will announce plans to address concerns about mis-selling of such risky financial products.

On Monday, financial authorities unveiled a set of proposals advising local banks and brokerages to compensate losses from equity-linked products tracking Hong Kong’s Hang Seng Index.

Authorities said the outstanding value of such products stood at 18.8 trillion won (US$14.2 billion) as of end-December, while the consumers stand to lose up to 5.8 trillion won if the products are sold at end-February value.

Source: Yonhap N
ews Agency