South Korea suspects more banks involved in naked shorting

SEOUL -- South Korea's financial regulator said on Friday that authorities suspect more investment banks were involved in naked short-selling, in addition to the two global banks already under investigation.

Naked short selling refers to shorting stocks without borrowing them or ensuring that they can be borrowed. It is often used as a way to aggressively drive down share prices. The practice is illegal in South Korea, the U.S. and other markets.