[1] The meaning of "a person who administers another's business" as the principal agent of the crime of taking a breach of trust, and the ground for a fiduciary relationship

[2] The meaning of "illegal solicitation" in the crime of taking property in breach of trust and the criteria for the determination thereof

[3] Cases falling under the information subject to the prohibition of using undisclosed information under Article 188-2 of the Securities and Exchange Act

[4] The case affirming the judgment of the court below that even if a certain press report was made by the press, it constitutes an undisclosed information under Article 188-2 of the Securities and Exchange Act, unless it is made public in accordance with the relevant Acts and subordinate statutes

[5] The meaning of "profit from the violation" under the proviso of Article 207-2 subparagraph 1 of the former Securities and Exchange Act and the method of calculating the "profit from the violation"

[1] Article 357 (1) of the Criminal Act / [2] Article 357 (1) of the Criminal Act / [3] Article 188-2 (2) of the Securities and Exchange Act / [4] Article 188-2 (2) of the Securities and Exchange Act / [5] Article 188-2 (1) of the former Securities and Exchange Act (amended by Act No. 6695 of Apr. 27, 2002) and Article 207-2 (1)

［1］［2］ 대법원 2004. 12. 10. 선고 2003도6866 판결 ［1］ 대법원 1999. 6. 22. 선고 99도1095 판결 (공1999하, 1546) 대법원 2000. 3. 14. 선고 99도5195 판결 대법원 2003. 2. 26. 선고 2002도6834 판결 (공2003상, 950) ［2］ 대법원 1988. 12. 20. 선고 88도167 판결 (공1989, 205) 대법원 1998. 6. 9. 선고 96도837 판결 (공1998하, 1921) ［3］ 대법원 1995. 6. 29. 선고 95도467 판결 (공1995하, 2676) 대법원 2000. 11. 24. 선고 2000도2827 판결 (공2001상, 212) ［5］ 대법원 2002. 6. 14. 선고 2002도1256 판결 (공2002하, 1741) 대법원 2005. 4. 15. 선고 2005도632 판결

Defendant

Defendant

Attorney Han-il et al.

Seoul District Court Decision 2003No1163 Delivered on January 7, 2004

The appeal is dismissed.

1. As to the crime of taking property in breach of trust

Article 357 (1) of the Criminal Act is established when a person who administers another's business obtains property or financial benefits in exchange for an unlawful solicitation in connection with his/her duties. The term "person who administers another's business" as the subject of the crime of taking property in breach of trust refers to a person who is acknowledged to have a fiduciary relationship to handle the business in light of the principle of trust and good faith in an internal relationship with another person. It does not necessarily require that a person has a right to the business in an external relationship with a third person. In addition, the business is not required to be entrusted with a comprehensive entrusted business. The ground for the management of the business, namely, the ground for the fiduciary relationship, can be caused by the provisions of Acts and subordinate statutes, legal act, custom, or business management (see Supreme Court Decisions 9Do1095, Jun. 22, 199; 2002Do6834, Feb. 26, 2003; 208Do1681, Feb. 26, 2008).

Based on the evidence of the first instance court’s adoption, the court below found the Defendant guilty of this part of the charges on this part, on the ground that the Defendant, as the head of the advisory team of Nonindicted Company 1 (name omitted), received the total amount of KRW 520,00,000 in response to the solicitation that the early redemption of the fourth unit of the convertible bonds issued by Nonindicted Company 2, which was acquired from Nonindicted Company 3, would be achieved without any interruption, from Nonindicted 3’s managing director of Nonindicted Company 2, who was in charge of corporate analysis and investment advice on the said company (name omitted) subject to investment.

In light of the records, the above judgment of the court below is just in accordance with the above legal principles, and there is no violation of the rules of evidence and misapprehension of legal principles as to the establishment of the crime of taking property in breach of trust

2. As to the violation of the Securities and Exchange Act due to the use of undisclosed information

A. Whether the case constitutes an undisclosed information

Article 188-2 (2) of the Securities and Exchange Act provides that "Important information which has not been disclosed to the public" shall be "before the corporation concerned discloses to the public under the conditions as prescribed by the Ordinance of the Ministry of Finance and Economy." Thus, until such information is disclosed by the corporation's will under the conditions as prescribed by the Ordinance of the Ministry of Finance and Economy, it still belongs to the information which is subject to the prohibition of using undisclosed information under Article 188-2 of the said Act (see Supreme Court Decisions 95Do467 delivered on June 29, 1995, 200Do2827 delivered on November 24, 200).

The lower court determined that the Defendant’s acquisition of the above company’s convertible bonds in Nonindicted 2’s name constitutes a nonpublic information under Article 188-2 of the Securities and Exchange Act, as it constitutes an act of using undisclosed information prohibited under Article 188-2(1) of the Securities and Exchange Act, even if the fact of progress of development after acceptance between Nonindicted 2 and Nonindicted 4 was reported to the public, unless otherwise disclosed to the general public in accordance with relevant statutes. The lower court determined that the Defendant’s acquisition of the above company’s convertible bonds in the name of Nonindicted 3, who is an executive of Nonindicted 2, constitutes a violation of the Securities and Exchange Act. According to the records, the lower court’s aforementioned determination is just in accordance with the above legal doctrine, and there is no error of misapprehending legal principles

B. Whether a fine imposed by the court below is unlawful

Article 207-2 subparagraph 1 of the former Securities and Exchange Act (amended by Act No. 6695 of Apr. 27, 2002) provides that a person who violates Article 188-2 (1) of the same Act shall be punished by imprisonment with prison labor for not more than 10 years or by a fine not exceeding 20 million won: Provided, That if the amount equivalent to three times the profit gained or loss avoided by the violation exceeds 20,00 won, the profit or loss amount shall be punished by a fine not exceeding three times the amount of the profit or evaded loss. The phrase "gains acquired by the violation" under the proviso of the same Article is a concept opposite to the phrase "loss amount", which means the difference after deducting all expenses incurred by the violator for the transaction from the total revenue from the transaction, so the profit acquired by the use of undisclosed information means the gross purchase amount from the sale amount of securities transaction related to such transaction and the net trading amount of the stocks still generated by the defendant's act of disposal, including the amount of the bonds held by the public and the remaining loss amount.

According to the records, on April 24, 2001, the defendant acquired one unit of convertible bonds issued by Nonindicted Co. 2 in the name of Nonindicted Co. 5 and paid KRW 1,095,779,918 from the (name omitted) fund using undisclosed information of this case on April 24, 2001. The defendant, as a major shareholder of Nonindicted Co. 2 in June 2001, entered into a contract with Nonindicted Co. 3 in which the defendant would acquire 50,000 shares of the above company in lieu of transferring one unit of the above convertible bonds to Nonindicted Co. 2 in the name of Nonindicted Co. 3 in the name of Nonindicted Co. 5, 201. The defendant acquired 30,000 won of the above company's shares on June 21, 2001, 3050 won of the remaining shares from May 30, 200 to June 30, 2002.

Based on the above factual basis, if the defendant calculated the above profits derived from the use of non-indicted 3's undisclosed information in the most favorable way to the defendant pursuant to the above legal principles, it is merely 738,158,205 won acquired from the sale of 160,00 won until July 19, 201, and 150,000 won thereafter are included in the above 30,000 share price, and it is deemed that 513,069,852 won out of the above 300,000 share price, and 20,00 won remaining from the above 50,000 won, which is the last day of sale, were 31,20,000 won (20,000 won x 560,000 won) which were assessed by the court below on April 26, 202 as 30,000 won, and it is not deemed that the above profits had been calculated on the basis of 9,500,000,0000 won.

In addition, even though the court below's amendment of the bill of amendment was made with the contents that specified the profits earned by the defendant only when it reached the court below, the court below did not err by violating the principle of prohibition of disadvantageous alteration to the court below's measure which allowed the amendment of the bill of amendment, as long as the court below sentenced a fine at

3. Conclusion

Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Hwang-sik (Presiding Justice)