SFC Bans Ha Po Kwan for 12 Months
On 17 July 2024, the Securities and Futures Commission (SFC) announced that they have banned Mr. Ha Po Kwan, a former representative of Primas Asset Management Limited (PAML), from the industry for 12 months, effective 14 June 2024 to 13 June 2025.
Following an investigation, the SFC found that in June 2021, Ha, then a director at PAML, falsified documents by altering the strike price or maturity date on two accumulator contracts and misled a client about these details. Ha also bypassed PAML’s internal policies by using his personal email for business communications, hindering proper monitoring.
Key factors in the SFC’s decision included Ha’s deliberate and dishonest actions, lack of personal monetary gain, no financial loss to the client, his admission of misconduct, cooperation with the investigation, and his previously clean record.
Market Manipulation Case Adjourned for Sentencing
On 17 June 2024, the Court of First Instance adjourned the sentencing of three individuals convicted of conspiracy to carry out false trading in the shares of Ching Lee Holdings Limited. The sentencing has been rescheduled to 22 July 2024 after hearing submissions from all parties involved.
The three defendants, Ms. Sit Yi Ki, Ms. Lam Wing Ki, and Mr. Tam Cheuk Hang, remain in custody under the Correctional Services Department pending their sentencing.
SFC’s 35th Anniversary: Guiding Hong Kong’s Capital Markets
On 19 June 2024, the SFC celebrated its 35-year history with the publication of its Annual Report 2023-24. The report highlights initiatives to promote resilience and sustainable growth in Hong Kong’s capital markets, solidifying its position as an international financial centre.
SFC Chairman Mr. Tim Lui emphasised the commission’s commitment to market integrity and resilience. CEO Ms. Julia Leung discussed the SFC’s dual role as both protector and enabler, focusing on sustainability and technology while ensuring investor protection.
Key achievements include the success of the Stock Connect scheme, ETF Connect, and the authorisation of Hong Kong’s first tokenized retail gold product. The SFC also played a pivotal role in several landmark enforcement cases and continues to lead in global standard-setting through active participation in IOSCO.
Three Sophisticated Ramp-and-Dump Cases Transferred to District Court
On 19 June 2024, the Eastern Magistrates’ Court approved the transfer of three large-scale ramp-and-dump cases to the District Court following joint investigations by the SFC and the Police. The first hearing will be held on 9 July 2024.
Eighteen defendants are charged with conspiracy to defraud, money laundering, and offences under the Securities and Futures Ordinance. They allegedly manipulated the shares of Eggriculture Foods Limited, Fullwealth Construction Holdings Company Limited, and KNT Holdings Limited through nominee accounts and social media to induce investors.
The Court granted bail with conditions including cash sureties, surrendering travel documents, and regular police reporting.
SFC Suspends Shum Wai Nap for Seven Months for Fund Management Failures
On 20 June 2024, the SFC suspended Mr. Shum Wai Nap, former licensed representative of PICC Asset Management (Hong Kong) Company Limited, for seven months due to failures in managing a private fund. Shum, who managed a Cayman-incorporated fund between May 2018 and April 2020, failed to align the fund’s investments with its stated strategy and objectives and did not manage risks according to PICC’s policies.
Key findings included highly concentrated positions in non-approved stocks and failures in managing liquidity and concentration risks. The SFC emphasized the gravity of these failures and the need for a strong deterrent message to maintain market integrity.
SFC Secures Conviction for Unlicensed Investment Advice on Telegram
On 20 June 2024, the Eastern Magistrates’ Court convicted Mr. Wong Ming Chung for providing paid investment advice on a subscription-based Telegram chat group without a license, following a prosecution by the SFC. Wong, who is licensed to act only for his accredited firm, pleaded guilty and was fined $10,000. He also paid the SFC’s investigation costs.
From January 2018 to May 2019, Wong hosted the Telegram group “FRANKY – 即市直播谷” where he provided daily commentaries and answered questions about the Hang Seng Index and Hong Kong-listed securities. The SFC reminds investors to verify the licensing status of advisors through the SFC’s Public Register before investing.
