Singers Im Chang-jung and Park Hye-kyoung claim to be stock fraud victims

Singers Im Chang-jung and Park Hye-kyoung are claiming to be victims of alleged stock price manipulation that dragged down a handful of small caps to their daily limit for almost a week.

“Two days ago, there was 2 billion won [$1.49 million] in my bank account, and now there is 189 million won,” Im told local news outlet JTBC on Tuesday.

Eight stocks listed in the Korean stock market, including Daesung Holdings, Seoul Gas and Sebang, have been nosediving to the daily limit of 30 percent through SG Securities Korea since April 24.

“I, unfortunately, was not aware of this until it was reported by news outlets and belatedly recognized that something was wrong,” he further explained through his social media on Thursday. “[Unlike previous reports say,] I am the victim here, who suffered losses after investing. I did not engage in marketing the stocks to others.”

JTBC on Wednesday had reported that Im loaned money to the people who are speculated to be responsible for the stock volatility.

The report said that Im sold them a part of his stake in the K-pop agency, Yesiam Entertainment, for 5 billion won, but gave them 3 billion won back to reinvest in whatever they want. The 3 billion won was first split in half and put into the bank accounts of Im and his wife, after which Im apparently gave these alleged criminals his and his wife’s IDs so that they could use them to invest more money. It was not specified how the people would have used their IDs to further commit illegal acts.

Park Hye-kyoung on Friday said she was also a victim of this stock fraud but was not encouraged by Im to invest.

Through her social media page, she said that she didn’t have an agency representing her at the time, so an acquaintance introduced her to a company which she shortly signed an exclusive contract with. One of the conditions in the contract was that she leave a deposit of 100 million won with the company.

“It was an odd condition, but singers who aren’t K-pop idols don’t usually get a deposit when signing a contract anyway, so I just decided to think of the money as not mine,” she said.

“After signing the contract, I would check the app that they told me to download on my phone, and it would show that money mushrooming an extra 3 or 4 million won, and I remember thinking to myself that these people must be geniuses. So, whenever I made money, I sent a part of it to the company, and that total amounted to 40 million won.”

I was just happy that the money was growing and didn’t expect anything like this would happen.”

The Financial Services Commission on Thursday raided an office of the alleged fraudsters in Gangnam District, southern Seoul, and put a travel ban on 10 suspects.

BY LEE JIAN [lee.jian@joongang.co.kr]