From Tuesday, investors caught engaging in stock short selling can be fined up to 100 percent of the amount of the order.

The Financial Services Commission(FSC) recently announced a revised bill reinforcing penalties for short selling that went into effect from Tuesday.

Under the new law, illegal short selling that previously was subject to only fines can now be subject to a criminal penalty and the imposition of surcharges.

Also perpetrators may face a prison term of up to a year and be slapped with fines of up to five times the illegally acquired profits.

Meanwhile, investors found to have engaged in short selling will be banned from taking part in corporate recapitalization.