The defendant shall be innocent.

The defendant is a corporation that runs the discretionary investment business that is operated separately for each investor by being authorized to make investment decisions from investors in Seocho-gu Seoul Metropolitan Government ( Address omitted).

(a) Sale and purchase of foreign currency securities;

Any person who intends to engage in foreign exchange business, such as the business of managing foreign currency securities, derivatives transactions, and investment judgment entrusted by investors, shall prepare sufficient capital, facilities, and professional human resources for conducting foreign exchange business and register such business with the Minister of Strategy and Finance in advance, as prescribed by Presidential Decree.

Nevertheless, on October 31, 2011, the Defendant, the representative director of the Defendant, issued an order to sell (sale price at 20,221,736 won) foreign currency securities to sell 430 share of 430 shares in a NH investment securities held in the NH investment trust account in the name of the investor “Non-Party 2” on the part of the Minister of Strategy and Finance, and issued an order to sell them to the NH investment securities (sale price at 20,221,736 won) from that time on July 25, 201, as stated in the [Attachment] List 1.

(b) Transactions of foreign currency derivatives;

Any person who intends to engage in foreign exchange business, such as the business of managing foreign currency securities, derivatives transactions, and investment judgment entrusted by investors, shall prepare sufficient capital, facilities, and professional human resources for conducting foreign exchange business and register such business with the Minister of Strategy and Finance in advance, as prescribed by Presidential Decree.

Nevertheless, the Defendant, the representative director of Nonindicted Party 1, without being registered in advance with the Minister of Strategy and Finance with respect to the Defendant’s business, received from investors’ “Nonindicted Party 3” and ordered to purchase or sell USDF 2011 (“USDF 45,268,000 won”) on November 16, 2011, and from that point, Defendant purchased or instructed to purchase 4 foreign currency derivatives from “Nonindicted Party 3” and “Nonindicted Party 4,00,000,000 won” as stated in [Attachment 2] List of Crimes No. 2, “Foreign Exchange Transaction No. 5,00,000” (hereinafter “Foreign Exchange No. 47,07,000,0000 won”) from investors “Nonindicted Party 1” and “Nonindicted Party 2,07,000,0000 won-free derivatives 2,07,000 won-free foreign exchange business from “Nonindicted Party 4,015,01.

2. The judgment of the court below

The lower court found the Defendant guilty of the facts charged of the instant case and sentenced a fine of KRW 5 million.

3. Summary of grounds for appeal;

A. Defendant

1) Legal principles

The term "foreign exchange business" under Article 27 (1) 5 of the former Foreign Exchange Control Act refers to "foreign exchange business" under Article 3 (1) 16 of the Foreign Exchange Control Act. Since the Defendant's order to operate a discretionary investment business entity does not constitute "foreign exchange business" under Article 3 (1) 16 of the Foreign Exchange Control Act, the Defendant is not a foreign exchange business without registration.

2) misunderstanding of facts

The Defendant did not have any intention to commit any violation of the Foreign Exchange Transactions Act by performing all necessary reporting and reporting duties in accordance with statutes related to foreign exchange transactions.

(b) An inspection;

The sentence of the court below is too unhued and unfair.

4. Judgment on the Defendant’s assertion of misapprehension of legal principles

A. Relevant statutes

1) Foreign Exchange Transactions Act

본문내 포함된 표 외국환거래법 제31조(양벌규정) 법인의 대표자나 법인 또는 개인의 대리인, 사용인, 그 밖의 종업원이 그 법인 또는 개인의 재산 또는 업무에 관하여 제27조, 제27조의2, 제28조 및 제29조의 어느 하나에 해당하는 위반행위를 하면 그 행위자를 벌하는 외에 그 법인 또는 개인에게도 해당 조문의 벌금형을 과한다. 다만, 법인 또는 개인이 그 위반행위를 방지하기 위하여 해당 재산 또는 업무에 관하여 상당한 주의와 감독을 게을리하지 아니한 경우에는 그러하지 아니하다. 제27조의2(벌칙) ① 다음 각 호의 어느 하나에 해당하는 자는 3년 이하의 징역 또는 3억원 이하의 벌금에 처한다. 다만, 위반행위의 목적물 가액의 3배가 3억원을 초과하는 경우에는 그 벌금을 목적물 가액의 3배 이하로 한다. 1. 제8조제1항 본문 또는 같은 조 제3항에 따른 등록을 하지 아니하거나, 거짓이나 그 밖의 부정한 방법으로 등록을 하고 외국환업무를 한 자(제8조제4항에 따른 폐지신고를 거짓으로 하고 외국환업무를 한 자 및 제12조제1항에 따른 처분을 위반하여 외국환업무를 한 자를 포함한다) 2., 3. (생략) ② 제1항의 징역과 벌금은 병과할 수 있다. 제8조(외국환업무의 등록 등) ① 외국환업무를 업으로 하려는 자는 대통령령으로 정하는 바에 따라 외국환업무를 하는 데에 충분한 자본·시설 및 전문인력을 갖추어 미리 기획재정부장관에게 등록하여야 한다. 다만, 기획재정부장관이 업무의 내용을 고려하여 등록이 필요하지 아니하다고 인정하여 대통령령으로 정하는 금융회사등은 그러하지 아니하다. ② 내지 ⑦ (생략) 제3조(정의) ① 이 법에서 사용하는 용어의 뜻은 다음과 같다. 1. "내국통화"란 대한민국의 법정통화인 원화(화)를 말한다. 2. "외국통화"란 내국통화 외의 통화를 말한다. 3. "지급수단"이란 다음 각 목의 어느 하나에 해당하는 것을 말한다. 가. 정부지폐·은행권·주화·수표·우편환·신용장 나. 대통령령으로 정하는 환어음, 약속어음, 그 밖의 지급지시 다. 증표, 플라스틱카드 또는 그 밖의 물건에 전자 또는 자기적 방법으로 재산적 가치가 입력되어 불특정 다수인 간에 지급을 위하여 통화를 갈음하여 사용할 수 있는 것으로서 대통령령으로 정하는 것 4. "대외지급수단"이란 외국통화, 외국통화로 표시된 지급수단, 그 밖에 표시통화에 관계없이 외국에서 사용할 수 있는 지급수단을 말한다. 5. "내국지급수단"이란 대외지급수단 외의 지급수단을 말한다. 6. "귀금속"이란 금, 금합금의 지금(지금), 유통되지 아니하는 금화, 그 밖에 금을 주재료로 하는 제품 및 가공품을 말한다. 7. "증권"이란 제3호에 해당하지 아니하는 것으로서 「자본시장과 금융투자업에 관한 법률」 제4조에 따른 증권과 그 밖에 대통령령으로 정하는 것을 말한다. 8. "외화증권"이란 외국통화로 표시된 증권 또는 외국에서 지급받을 수 있는 증권을 말한다. 9. "파생상품"이란 「자본시장과 금융투자업에 관한 법률」 제5조에 따른 파생상품과 그 밖에 대통령령으로 정하는 것을 말한다. 10. "외화파생상품"이란 외국통화로 표시된 파생상품 또는 외국에서 지급받을 수 있는 파생상품을 말한다. 11. "채권"이란 모든 종류의 예금·신탁·보증·대차(대차) 등으로 생기는 금전 등의 지급을 청구할 수 있는 권리로서 제1호부터 제10호까지의 규정에 해당되지 아니하는 것을 말한다. 12. "외화채권"이란 외국통화로 표시된 채권 또는 외국에서 지급받을 수 있는 채권을 말한다. 13. "외국환"이란 대외지급수단, 외화증권, 외화파생상품 및 외화채권을 말한다. 14. "거주자"란 대한민국에 주소 또는 거소를 둔 개인과 대한민국에 주된 사무소를 둔 법인을 말한다. 15. "비거주자"란 거주자 외의 개인 및 법인을 말한다. 다만, 비거주자의 대한민국에 있는 지점, 출장소, 그 밖의 사무소는 법률상 대리권의 유무에 상관없이 거주자로 본다. 16. "외국환업무"란 다음 각 목의 어느 하나에 해당하는 것을 말한다. 가. 외국환의 발행 또는 매매 나. 대한민국과 외국 간의 지급·추심(추심) 및 수령 다. 외국통화로 표시되거나 지급되는 거주자와의 예금, 금전의 대차 또는 보증 라. 비거주자와의 예금, 금전의 대차 또는 보증 마. 그 밖에 가목부터 라목까지의 규정과 유사한 업무로서 대통령령으로 정하는 업무 17. "금융회사등"이란 「금융위원회의 설치 등에 관한 법률」 제38조(제9호 및 제10호는 제외한다)에 따른 기관과 그 밖에 금융업 및 금융 관련 업무를 하는 자로서 대통령령으로 정하는 자를 말한다. 18. 내지 20. (생략) ② (생략)

If a representative of a juristic person, or an agent, employee or any other employed person of a juristic person or individual under Article 31 of the former Foreign Exchange Transactions Act (amended by Act No. 14525, Jan. 17, 2017; hereinafter referred to as the "former Foreign Exchange Transactions Act") or an individual commits an offense falling under any of Articles 27 through 29 in connection with the property or business of the juristic person or individual, not only shall such offender be punished, but also the juristic person or individual shall be punished by a fine under the relevant provisions: Provided, That this shall not apply where the juristic person or individual has not been negligent in giving due attention and supervision concerning the relevant property or business to prevent such offense: < Amended by Act No. 1452, Jan. 17, 2017>

2) Enforcement Decree of the Foreign Exchange Transactions Act

1. Transactions of securities or bonds denominated or paid in the domestic currency with non-residents and transactions of trust, insurance and derivatives between residents and non-residents; 3. Lease of facilities (referring to lease of facilities under the Specialized Credit Financial Business Act; hereinafter the same shall apply) denominated in foreign currency; 4. Other affairs incidental to transactions under Article 3 (1) 16 (a) through (d) of the Act and subparagraphs 1 through 3 of this Article, which are denominated in foreign currency or denominated in foreign currency; 4. Foreign exchange affairs of financial companies, etc. registered under the proviso to paragraph (1) of the same Article (including foreign exchange affairs; hereinafter referred to as "foreign exchange agencies");

1. Transactions of securities or bonds denominated or paid in domestic currency with non-residents: 2. Transactions of trust, insurance and derivatives (limited to those related to foreign exchange) between residents and non-residents; 3. Lease of facilities in foreign currency (referring to facility leasing under the Specialized Credit Financial Business Act; hereinafter the same shall apply) indicated in foreign currency; 4. Other affairs incidental to those referred to in Article 3 (1) 16 (a) through (d) of the Act and subparagraphs 1 through 3 of this Article:

. The scope of foreign exchange affairs of financial companies, etc. (including financial companies, etc. under the proviso to the same paragraph; hereinafter referred to as "foreign exchange agencies") registered under Article 14 of the former Enforcement Decree of the Foreign Exchange Transactions Act (amended by Presidential Decree No. 25945, Dec. 30, 2014) which are included in the main sentence shall be as follows:

B. The meaning of "foreign exchange business"

1) Article 27(1)5 of the former Foreign Exchange Transactions Act provides that a person engaged in foreign exchange business shall be punished without registration under the main sentence of Article 8(1) of the Foreign Exchange Transactions Act. According to Article 3(1)16 of the Foreign Exchange Transactions Act, “foreign exchange business” means trading foreign currency securities, foreign currency derivatives, etc. (a) and other similar businesses prescribed by Presidential Decree (e).

2) Article 6 of the former Enforcement Decree of the Foreign Exchange Transactions Act (amended by Presidential Decree No. 27038, Mar. 22, 2016) provides for foreign exchange business under subparagraph 16 (e) of Article 3 of the Foreign Exchange Transactions Act (amended by Presidential Decree No. 27038, Mar. 22, 2016). The term “transaction of derivatives (limited to those related to foreign exchange) between residents,” “transaction of derivatives between residents and non-residents (subparagraph 1)” and other business incidental to such business.

C. Determination on the instant case

1) The summary of the facts charged in this case is that the Defendant, who mainly engages in discretionary investment business, was an investment from investors, instructed a securities company to sell foreign currency securities (Paragraph 1), and ordered a securities company to purchase or sell foreign currency derivatives in Korea, and ordered a securities company to purchase or sell foreign currency derivatives (Paragraph 2).

(1) The sale of foreign currency securities falls under the category of "transaction of foreign exchange" under Article 3 (1) 16 (a) of the Foreign Exchange Control Act, and (2) the purchase or sale of domestic foreign currency derivatives falls under the category of "transaction of derivatives between residents" and "transaction of derivatives between residents" under Article 3 (1) 16 (e) of the Foreign Exchange Control Act, Article 6 (2) of the former Enforcement Decree of the Foreign Exchange Transactions Act (amended by Presidential Decree No. 27038, Mar. 22, 2016) and the purchase or sale of foreign currency derivatives, respectively.

2) However, the Defendant received investment from investors, who are customers, and instructed a securities company to sell foreign currency securities on behalf of investors, or instructed investors to trade foreign currency derivatives at home and abroad, but did not directly sell foreign currency securities or trade foreign currency derivatives. The Defendant sold foreign currency securities or traded foreign currency derivatives by investors was a securities company.

The above foreign exchange transaction instruction against the defendant's securities company does not fall under "foreign exchange transaction" under Article 3 (1) 16 (a) of the Foreign Exchange Control Act, "transaction between residents" under Article 3 (1) 16 (e) of the Foreign Exchange Control Act, "transaction between residents" under Article 6 (2) of the former Enforcement Decree of the Foreign Exchange Control Act, and "transaction between residents and non-resident", and does not fall under other foreign exchange transactions under Article 3 (1) 16 of the Foreign Exchange Transactions Act and Article 6 of the former Enforcement Decree of the Foreign Exchange Transactions Act.

3) The prosecutor asserts that the Defendant’s act constitutes a foreign exchange business since it constitutes “the business of separately managing investors under a discretionary discretion to make investment decisions” under Article 14 subparag. 4(j) of the former Enforcement Decree of the Foreign Exchange Transactions Act (amended by Presidential Decree No. 25945, Dec. 30, 2014).

However, Article 14 of the former Enforcement Decree of the Foreign Exchange Transactions Act only provides for the scope of foreign exchange business that can be handled by a financial company, etc. registered under Article 8(1) of the Foreign Exchange Transactions Act. Thus, the scope of foreign exchange business required to be registered under Article 14 of the former Enforcement Decree of the Foreign Exchange Transactions Act cannot be deemed to be expanded. If a foreign exchange business is violated, it is clear that the foreign exchange business subject to criminal punishment is limited to the business prescribed by Presidential Decree according to delegation under Article 3(1)16 of the Foreign Exchange Transactions Act and Article 3(1)16(e) of the former Enforcement Decree of the Foreign Exchange Transactions Act (amended by Presidential Decree No. 27038, Mar. 22, 2016).

4) Ultimately, the Defendant’s act stated in the facts charged in the instant case does not constitute a foreign exchange business under Article 3(1)16 of the Foreign Exchange Transactions Act and Article 6 of the former Foreign Exchange Transactions Act, and there is no other evidence to acknowledge it. Thus, even if the Defendant did not register pursuant to the main sentence of Article 8(1) of the Foreign Exchange Transactions Act and did not constitute a violation of Article 27(1)5 of the former Foreign Exchange Transactions Act and the main sentence of Article 8(1) of the Foreign Exchange Transactions Act.

5) Therefore, the facts charged in this case constitute a case where there is no proof of crime, and the judgment of the court below which found the Defendant guilty of the facts charged in this case is erroneous in the misapprehension of legal principles as to foreign exchange business,

5. Conclusion

Therefore, the defendant's appeal without further examining the defendant's assertion of mistake of facts is well-grounded. Thus, the judgment of the court below is reversed under Article 364 (6) of the Criminal Procedure Act without examining the defendant's argument of mistake of facts and the prosecutor's argument of unfair sentencing, and the judgment

The facts charged of this case are identical to Paragraph (1) and Paragraph (4). Since there is no evidence to acknowledge the facts charged, the defendant is acquitted by the latter part of Article 325 of the Criminal Procedure Act.

(attached Form omitted)

Judges Cho Sung-sung (Presiding Judge)