SEOUL, Dec 5 (Reuters) - A South Korean regulator informed Goldman Sachs’ local unit this week of its intent to impose disciplinary action for possible breach of domestic capital markets rules, three regulatory sources said on Thursday.
The action is expected to be “light”, two of the sources said, usually meaning a simple caution or a warning that limits the forming of new subsidiaries for up to three years.
The Financial Supervisory Service had reviewed three brokerages, including Goldman, earlier this year for possible breach of domestic capital markets regulations.
Regulators had focused their review on whether Goldman’s sale of Malaysian state-backed securities to domestic investors had followed domestic capital markets regulations, such as requiring the sales to be transacted through a local unit licensed to sell products in South Korea.
The action must be approved, with a final decision expected by the end of the year at the earliest, said the sources with direct knowledge of the matter.
A Seoul-based Goldman Sachs spokesman declined to comment. A spokesman for the regulator declined to comment on an ongoing matter.