Partner Shin-young Choi of Cha & Kwon Law Offices provided advisory services and represented investors in litigation concerning damages arising from the mis-selling of private equity fund products.

The key issue in this matter was whether the financial investment company had adequately fulfilled its obligations under the suitability principle and duty to explain, particularly in light of the investor’s profile, including investment propensity, financial status, and prior investment experience. In particular, questions were raised as to whether misleading statements were made regarding principal protection or stable returns, whether the risks associated with the product structure and underlying assets were sufficiently disclosed, and whether recording and written confirmation procedures were conducted merely as formalities.

Partner Choi systematically analyzed the illegality of the sales practices based on the Financial Investment Services and Capital Markets Act, including the suitability requirement, duty of explanation, prohibition of unfair solicitation, and relevant case law. In addition, she comprehensively reviewed product descriptions, internal sales guidelines, compliance standards, call recordings, and consultation records to distinguish between formal procedural compliance and the substantive fulfillment of disclosure obligations, and structured the legal arguments accordingly.

Furthermore, in assessing damages, she carefully examined factors such as the initial investment amount, recovered funds, interim distributions, and the timing of loss realization, and organized causation and liability ratios accordingly. Through comparative analysis with Financial Supervisory Service dispute resolution cases and similar court precedents, a reasonable scope of liability was derived.