South Korea's KB Securities Co. Ltd. and JB Asset Management Co. Ltd. are taking legal action against Australia's LBA Capital for allegedly misappropriating money borrowed from the asset manager's JB Australia NDIS Fund, The Korea Times reported Sept. 4.
The South Korean companies alleged that LBA Capital violated the contract by purchasing land with money borrowed from the fund, which was set up to invest in businesses associated with the Australian government's housing policy for the disabled. Institutional and individual investors could face up to 100 billion won in losses from the alleged fraud, the outlet reported.
The two companies started withdrawing funds after finding out about the issue. KB Securities recovered 201.5 billion won in cash, while the County Court of Victoria ordered to freeze 88.2 billion won worth of LBA Capital's cash and real estate, according to a company official. The brokerage will seek damages against LBA Capital and its three executives, the official added.
KB Securities and JB Asset Management have engaged international commercial law firm Allens.
As of Sept. 4, US$1 was equivalent to 1,204.81 South Korean won.
