Seoul: A Seoul court on Tuesday acquitted HSBC on charges of violating the nation's short-selling rules, citing a lack of evidence. The Seoul Southern District Court made the ruling after prosecutors indicted HSBC's Hong Kong unit last March for violating the Capital Markets Act, which restricts all types of short selling, excluding covered ones.
According to Yonhap News Agency, prosecutors alleged that three HSBC traders engaged in illegal naked short selling of shares worth about 15.8 billion won (US$10.9 million) from August to December 2021. However, the court found no evidence that the bank's employees were aware of any wrongdoing as they engaged in naked short selling.
Naked stock short selling refers to short selling stocks without having secured or placing orders to secure those to be sold.