Supreme Court: NH Investment Ordered to Pay KRW 7.5 Billion to Ottogi for Optimus Fund Sales

On May 20, 2026, the Supreme Court of South Korea ruled in a landmark case involving the Optimus fund scandal, ordering NH Investment & Securities to pay 7.5 billion won in damages to food manufacturer Ottogi. The Optimus funds, managed by Optimus Asset Management, were at the center of a massive fraud wherein underlying assets—such as public institution receivables—were entirely fabricated. Ottogi had purchased these funds as an institutional investor through NH Investment, relying on its due diligence. After the Ponzi scheme collapsed in 2020, Ottogi suffered substantial losses and sued the seller for failing to properly explain the risks and verify the fund’s abnormal structure. The Supreme Court held that the financial intermediary breached its suitability and explanation obligations under the Capital Markets Act and the Financial Consumer Protection Act, emphasizing that distributors cannot blindly trust fund managers without independent verification.

The Supreme Court partially granted Ottogi’s appeal, affirming the seller’s liability. NH Investment & Securities was ordered to pay 7.5 billion won in compensation. The ruling confirmed that the securities firm failed to fulfill its duties of suitability assessment and risk disclosure, and could not escape liability merely by pointing to the fund manager’s deception.

The key disputes were whether NH Investment violated its duty of care and obligation to explain the product’s risks under financial consumer protection laws; whether the seller should have detected the fraudulent nature of the fund; and to what extent Ottogi’s own negligence contributed to the loss, affecting the apportionment of damages.

The decision significantly strengthens the accountability of financial distributors in South Korea. It clarifies that sellers must independently verify high-risk investment products and face substantial compensation for negligence. The ruling is expected to encourage a wave of similar lawsuits by other Optimus fund victims and has prompted regulators to tighten oversight on sales practices, due diligence, and investor protection mechanisms across the securities industry.