South Korea’s Financial Supervisory Service (FSS) has proposed imposing fines of over KRW10bn (USD7.66m) on HSBC Holdings and BNP Paribas for illegal naked short selling. The recommendation, yet to be finalised by the Financial Services Commission’s Securities and Futures Commission, is under discussion. Naked short selling, the practice of selling shares without borrowing them, is banned in South Korea. The decision on the fines remains pending, with the final amounts subject to change. If enforced, these fines will mark the first such penalties on global banks for naked short selling in South Korea, exceeding a record fine imposed earlier on Erste Asset Management. This follows Korea’s recent actions against global hedge funds for similar violations and an extended ban on short selling until June 2024.