Defendant

Defendant

old-style (prosecution) and Lee Sung-il (public trial)

Law Firm LLC et al.

Seoul Northern District Court Decision 2011Ma2044 Decided October 21, 2011

The defendant's appeal is dismissed.

1. Summary of grounds for appeal;

A. Legal principles: The Defendant’s ○○○○○ site operated is not a place where the actual futures trading is conducted, but its members only conducted a kind of futures trading, i.e., futures investment game at the above site. Therefore, the Defendant cannot be deemed to have conducted financial investment business as prescribed by the Financial Investment Services and Capital Markets Act, opened financial investment instruments trading market or facilities similar thereto, or traded securities or exchange-traded derivatives using similar facilities.

B. Unreasonable sentencing: The sentence of the lower court (six months of imprisonment) is too unreasonable.

2. Determination

A. Legal principles

(1) Relevant legal provisions: as shown in the attached Form.

(2) Determination

(A) The fact that the unmanned is running financial investment business

1) In light of the purport of the enactment of the capital market and the Financial Investment Services and Capital Markets Act (hereinafter “Capital Markets Act”), even if the Korea Exchange does not constitute derivatives already traded in conformity with Article 5 of the Capital Markets Act, such rights shall be deemed derivatives under the Capital Market and Financial Investment Services and Capital Markets Act, insofar as they are interpreted as contractual rights consistent with

2) The operating method of “○○○” operated by the Defendant is the method of trading cyber money converted into the applicable ratio chosen by the members when the members deposit money to the Defendant’s account, and the members use it to conduct futures trading by choosing the 200 COS futures trading in the Home Trading System (HTS) and using it. It is the structure of the Defendant’s profit in the event of loss to the members, and the Defendant’s profit in the event of loss to the members, and the Defendant’s profit in the event of profit to the members.

3) Accordingly, the goods traded in ○○○ constitutes derivatives that refer to contractual rights under each subparagraph of Article 5(1) of the Capital Market and Financial Investment Services and Capital Markets Act that are linked to “underlying assets” that are risks belonging to economic phenomena, etc. and that can be calculated or assessed by price, interest, indicator, and unit in a reasonable and appropriate manner. The Defendant is engaging in financial investment business by engaging in trading derivatives on his/her own account. Thus, this part of the Defendant’s assertion is without merit.

(B) Establishment of similar facilities

The defendant's act of settling profits and losses between ○○○○○○○○ established by himself and its members through cyber money trading and then trading exchange-traded derivatives using facilities similar to the financial investment instruments trading market by a person who is not an Exchange, such as trading business of exchange-traded derivatives, transaction confirmation, debt acquisition, deduction, settlement securities, settlement items, and settlement amount confirmation, etc. as well as trading business of exchange-traded derivatives, which are duties of an Exchange under Article 377 of the Capital Market and Financial Investment Services and Capital Markets Act. Thus, the defendant's prior assertion on a different premise is without merit.

B. Determination on the assertion of unfair sentencing

In full view of the various forms and conditions shown in the records and arguments of this case and the fact that the defendant committed the crime of this case during the period of suspended execution, the sentence of the court below is too unreasonable.

3. Conclusion

Therefore, the Defendant’s appeal is dismissed in accordance with Article 364(4) of the Criminal Procedure Act. It is so decided as per Disposition by the assent of all participating Justices (Article 25(1) of the Regulations on Criminal Procedure, however, that Article 27 of the Act on Criminal Procedure applies to the application of the judgment of the court below to “Article 27” as “Article 27 of the Act on Criminal Procedure.” Although the prosecutor’s application for the amendment of a bill of indictment was permitted to add the facts charged in the opening of gambling, as long as the trial was found guilty of the primary facts charged, it is not separately determined as to the ancillary facts added in the trial).

Judges Jeong-ho (Presiding Judge)