Newsletter – June 2019

Content
  1. SFC bans Wong Ka Hang for nine months
  2. SFC reprimands and fines China Merchants Securities (HK) Co., Limited HK$5 million for mishandling client money
  3. SFC seeks disqualification order against former chief financial officer of Fujian Nuoqi Co., Ltd.
  4. SFC reprimands and fines Credit Suisse (Hong Kong) Limited and Credit Suisse AG HK$2.8 million for regulatory breaches
  5. SFAT affirms SFC decision to reprimand and fine FT Securities Limited HK$3.5 million
  6. SFC issues restriction notices to nine brokers to freeze client accounts linked to suspected market manipulation of China Ding Yi Feng shares
  7. SFC issues restriction notices to 14 brokers to freeze client accounts linked to suspected market manipulation of Smartac Group China Holdings Limited
  8. Market Misconduct Tribunal fines Health and Happiness and its chairman HK$3.2 million in total for late disclosure of inside information
  9. SFC and ICAC search sponsor firms

1.     SFC bans Wong Ka Hang for nine months

On 28 May 2019, the SFC has banned Mr Wong Ka Hang from re-entering the industry for 9 months from 28 May 2019 to 27 February 2020.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR45

For the Statement of Disciplinary Action, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/openAppendix?refNo=19PR45&appendix=0

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2.     SFC reprimands and fines China Merchants Securities (HK) Co., Limited HK$5 million for mishandling client money

On 30 May 2019, the SFC has reprimanded China Merchants Securities (HK) Co., Limited and fined it HK$5 million for regulatory breaches and internal control failings related to mishandling of client money.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR46

For the Statement of Disciplinary Action, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/openAppendix?refNo=19PR46&appendix=0

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3.     SFC seeks disqualification order against former chief financial officer of Fujian Nuoqi Co., Ltd.

On 4 June 2019, the SFC has commenced legal proceedings in the Court of First Instance to seek a court order to disqualify the former chief financial officer, company secretary and executive director of Fujian Nuoqi Co., Ltd., Mr Au Yeung Ho Yin.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR47

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4.     SFC reprimands and fines Credit Suisse (Hong Kong) Limited and Credit Suisse AG HK$2.8 million for regulatory breaches

On 19 June 2019, the SFC has reprimanded and fined Credit Suisse (Hong Kong) Limited and Credit Suisse AG HK$2.8 million over their failures to comply with the disclosure requirements when they published certain research reports on Hong Kong-listed securities.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR51

For the Statement of Disciplinary Action, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/openAppendix?refNo=19PR51&appendix=0

5.     SFAT affirms SFC decision to reprimand and fine FT Securities Limited HK$3.5 million

On 24 June 2019, the Securities and Futures Appeals Tribunal (SFAT) affirmed the decision of the SFC to reprimand FT Securities Limited and fine it HK$3.5 million for regulatory breaches and internal control failures in relation to preparation and publication of research reports.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR54

For the SFAT’s reasons for the determination, please refer to:

https://www.sfat.gov.hk/english/determination/AN-6-2018-Determination.pdf

For the SFC’s press release dated 10 December 2018, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=18PR139

6.     SFC issues restriction notices to nine brokers to freeze client accounts linked to suspected market manipulation of China Ding Yi Feng shares

On 25 June 2019, the SFC has issued restriction notices to nine brokers, prohibiting them from dealing with or processing certain assets held in their client accounts which are related to suspected market manipulation in the shares of China Ding Yi Feng Holdings Limited between 2018 and early 2019.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR55

For the SFC’s press release dated 20 March 2019, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR23

7.     SFC issues restriction notices to 14 brokers to freeze client accounts linked to suspected market manipulation of Smartac Group China Holdings Limited

On 25 June 2019, the SFC has issued restriction notices to 14 brokers, prohibiting them from dealing with or processing certain assets held in their client accounts which are related to suspected market manipulation in the shares of Smartac Group China Holdings Limited between October 2018 and March 2019.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR56

8.     Market Misconduct Tribunal fines Health and Happiness and its chairman HK$3.2 million in total for late disclosure of inside information

On 25 June 2019, the Market Misconduct Tribunal has found that Health and Happiness (H&H) International Holdings Ltd and its chairman and executive director Mr Luo Fei failed to disclose inside information as soon as reasonably practicable and fined them HK$1.6 million each following proceedings brought by the SFC.

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR57

For the SFC’s press release dated 29 November 2018, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=18PR131

9.     SFC and ICAC search sponsor firms
On 26 June 2019, the SFC has conducted a joint operation with the Independent Commission Against Corruption (ICAC) which involved a search of the offices of two sponsor firms.  The SFC conducted the search using its powers under the Securities and Futures Ordinance (SFO).

For more details, please refer to:

https://www.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/enforcement-news/doc?refNo=19PR58

The article is for general information purpose only and is not intended to constitute legal or other professional advice.

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