Supreme Court Orders NH Investment to Pay 7.5 Billion Won to Ottogi for Optimus Fund Sales

On May 20, 2026, the Supreme Court of South Korea ruled that NH Investment & Securities must pay 7.5 billion won in damages to food company Ottogi. The case originated from NH Investment’s sale of funds managed by Optimus Asset Management, which was later found to be a massive fraud involving fictitious investment portfolios. Ottogi invested billions of won in these funds through NH Investment but suffered heavy losses when the scandal broke. The central legal issue was whether the securities firm had adequately fulfilled its duty to explain the products' high-risk nature and potential conflicts of interest. Ottogi claimed NH Investment misrepresented the funds as safe and failed to disclose critical information. The Supreme Court’s decision affirmed the seller’s liability for mis-selling, concluding that the company violated its obligation to protect investors and ensure suitability.

The Supreme Court of Korea ruled in favor of Ottogi, ordering NH Investment & Securities to pay 7.5 billion won in damages. The court held that the firm failed to fulfill its obligation to explain the product and its risks, thereby violating investor protection duties.

Whether NH Investment & Securities properly explained the risks of the Optimus Fund and fulfilled its duty of care, and whether its failure to do so constituted mis-selling that made it liable for the investor's losses.

The ruling significantly strengthened the accountability of financial institutions for mis-selling complex investment products. It sent a clear warning to the securities industry about the legal consequences of inadequate risk disclosure and reinforced the standard of care owed to investors, bolstering confidence in the legal system's protection against fund fraud.