GCE MONTHLY REGULATORY ROUND-UP
March 2025 | Hong Kong • Singapore • Australia
HONG KONG | Securities and Futures Commission (SFC)
The SFC has continued its active enforcement stance through March, underscoring the importance of licensing clarity, internal control robustness, and transparency across market activities.
The month began with the suspension of Franky Wong — a licensed representative at Tse’s Securities — for a period of 16 months, following his conviction for providing investment advice via a paid Telegram channel outside of his licensed entity. Despite holding Type 1 and Type 4 licences, Wong delivered advice in a personal capacity through a private subscription group, operating entirely outside of Tse’s oversight. This case makes it clear: being licensed isn’t a blanket endorsement — representatives must only act within the scope of their accredited firm. The SFC has made it plain that conduct like this is unacceptable and fails the fit and proper person test.
A separate prosecution involving false trading in the shares of Pa Shun International Holdings was adjourned to May, with the accused — Lin Tai Fung and his brother-in-law — facing charges of conspiracy to commit market misconduct and failing to disclose relevant interests. Though no plea has yet been entered, it reinforces that the SFC is prepared to pursue egregious breaches through the courts where necessary.
In a move directed at strengthening market stability, the SFC issued new guidance for licensed corporations providing IPO subscription and financing services. Following a thematic review, a number of firms were found to have accepted leveraged applications that far exceeded their clients’ financial capacities. The SFC expects better. The new circular sets out expectations around upfront deposits, financial assessments, and proper segregation of subscription funds, while also reinforcing the need to comply with the FINI investor identification regime. The message is clear — risk must be managed prudently, especially in high-volume, high-volatility spaces like IPOs.
On 24 March, disciplinary action was taken against Enlighten Securities, which received a $5 million fine for serious control failings over a two-year period. Margin clients with outstanding shortfalls were allowed to continue trading unchecked, while internal processes failed to enforce margin call policies or apply credit limits. The firm’s Responsible Officer, Denny Kua, has also been suspended for seven months. Despite previous warnings going back to 2015, these deficiencies were never fully remediated. This is a textbook example of senior management accountability — when the controls don’t function, the regulators will act.
Trial dates were also set in three significant ramp-and-dump prosecutions involving 19 individuals. These cases, which have been developing for some time, relate to suspected fraud and money laundering linked to listed shares of Eggriculture Foods, Fullwealth Construction, and KNT Holdings. The proceedings mark a joint enforcement initiative between the SFC and the Police, reflecting an increasingly integrated approach to tackling market abuse.
In more positive news, the SFC published its 2024 financial review of the securities industry. The data was strong across the board, with net profits rising 56% to $44.4 billion and total transaction value reaching $144.1 trillion — up 34% year-on-year. Growth in commission income, asset management fees, and underwriting activity shows that the industry continues to diversify and stabilise after recent headwinds. It’s a healthy sign of resilience in the broader financial ecosystem.
The SFC also confirmed that its insider dealing prosecution against Wong Pak Ming — related to Pegasus Entertainment — has been adjourned to April. Wong is alleged to have directed others to trade on inside information while he was chairman and controlling shareholder. These proceedings are ongoing, but the SFC continues to signal zero tolerance in this space.
From a governance perspective, the appointment of Tony Tang and the reappointment of Michael Wong as Non-Executive Directors of the SFC Board was announced. Their experience and global exposure are expected to support the SFC’s strategic direction. Dr Kelvin Wong, the Chairman, also formally acknowledged the contribution of outgoing Director Nicky Lo.
Finally, in a forward-looking move, the SFC opened consultation on amendments to the Securities and Futures (Stock Market Listing) Rules (SMLR). The proposed changes would give the SFC greater flexibility in applying post-listing conditions, reduce the need for trading suspensions through streamlined processes, and allow for more efficient oversight of IPO disclosures. The aim is to encourage market transparency and reduce friction without compromising investor protection. Submissions are open until 23 May.
SINGAPORE | Monetary Authority of Singapore (MAS)
The Singaporean regulator maintained its dual focus in March: expanding retail investor access to private markets while stepping up enforcement and scam prevention efforts in response to increasingly sophisticated threats.
MAS has proposed a regulatory framework that would open the door for retail investors to participate in private market investment funds — a space traditionally limited to institutional and accredited investors. The proposed Long-term Investment Fund (LIF) framework includes two structures: a direct investment fund offering transparency over the underlying assets, and a long-term fund-of-funds vehicle that leverages the expertise of external managers to build diversified portfolios. MAS is consulting on the appropriate safeguards needed for each structure and is seeking views on what types of private market assets should be considered suitable for retail access. Feedback is due by 26 May 2025. This move is a clear step towards modernising fund access, without compromising investor protection.
In enforcement, MAS issued a six-year Prohibition Order against Danny Lim, a former representative of Professional Investment Advisory Services. Lim was convicted of multiple forgery and cheating offences, including forging client signatures to transfer accounts and receiving illegal funds through his personal bank account. He was sentenced to 15 weeks’ imprisonment. Under the Prohibition Order, which took effect on 21 March 2025, Lim is barred from all MAS-regulated activity and from acting as a director or substantial shareholder of any financial institution. MAS has again reinforced that individuals who fail the fit and proper test will be removed from the industry — and that misconduct involving client trust and criminal behaviour will result in lasting regulatory consequences.
In response to a new wave of scam typologies, MAS, the Singapore Police Force (SPF), and Cyber Security Agency (CSA) jointly issued a warning on digital impersonation scams. Scammers are now using alleged AI-driven deepfake video calls to impersonate senior executives of targeted firms. Victims are invited via WhatsApp to join video meetings that appear to involve their own management teams — sometimes even impersonating MAS officials or potential investors — and are instructed to execute fraudulent fund transfers. In some cases, scammers go further by impersonating legal counsel and sending forged documents to support the narrative. MAS has reiterated that it never requests money or personal data and is urging all firms to implement verification protocols for digital communication, particularly for fund transfers and identity checks.
Separately, a second alert was issued on 14 March concerning impersonation scams involving Income Insurance, UnionPay, NTUC Union, and MAS officials. Victims received unsolicited calls claiming they had outstanding life insurance payments. They were then persuaded to “verify” their bank accounts by transferring funds to scammer-controlled accounts, often guided via WhatsApp’s screen-sharing feature. In some cases, a second scammer impersonated an MAS officer, citing fabricated links to money laundering. Losses across six reported cases total at least S$1.7 million. MAS and the SPF are urging the public to remain vigilant, adopt the ADD-CHECK-TELL protocol, and to never share personal or financial information via unsolicited messages or calls.
On the international front, MAS deepened ties with Vietnam’s financial authorities. An upgraded MOU with the State Bank of Viet Nam (SBV) will support greater collaboration on digital innovation and payment connectivity — including QR payment systems between both markets. MAS also signed a Letter of Intent with the State Securities Commission of Viet Nam (SSC) to share knowledge and build capacity around capital markets regulation and the development of a digital asset regulatory framework. Both moves underscore MAS’s commitment to regulatory cooperation, cross-border interoperability, and shaping regional financial infrastructure.
AUSTRALIA | ASIC and AUSTRAC
March saw ASIC and AUSTRAC continuing their assertive approach to enforcement, supervision, and policy reform, with actions spanning cybersecurity, market integrity, greenwashing, financial advice, and operational risk in critical infrastructure.
ASIC has filed proceedings against FIIG Securities, alleging the firm failed to maintain adequate cybersecurity controls over a four-year period, allowing a cyberattack that compromised 385GB of sensitive client data. More than 18,000 customers were affected, with data released on the dark web. The breach went undetected for weeks, and ASIC claims FIIG’s controls — including patching, firewall monitoring, and staff training — were materially deficient. This is ASIC’s second cybersecurity enforcement and underscores its warning: digital resilience is not optional — it is now a core compliance obligation under the AFS licensing regime.
On the conduct front, ASIC permanently banned Sydney-based adviser Peter Surtenich for misleading clients about high-yield ‘principal protected’ products. Surtenich made dishonest representations about the safety and structure of these schemes and facilitated transfers to suspect entities, including payments to a bitcoin wallet — triggering ASIC’s conclusion that he lacked the integrity and judgment required of a financial professional.
Harris Shortland, a Northern Territory-based adviser, has also been banned for seven years after a criminal conviction for supplying cocaine and handling the proceeds. The matter reflects ASIC’s ongoing position that criminal behaviour and financial services cannot co-exist — and that misconduct of any kind undermines the sector’s professional standards.
ASIC is also pursuing former executives of Irexchange Limited (IRX) — including its former CEO, CFO, and legal counsel — on charges of providing false and misleading information to both shareholders and the regulator. The case relates to representations made in IRX’s 2018 prospectus and internal dealings over founder shares. The matter is being prosecuted by the Commonwealth DPP, with the next hearing scheduled for April.
Separately, ASIC has commenced proceedings to wind up the First Guardian Master Fund and its responsible entity, Falcon Capital, over serious governance failures. Concerns include delayed receivables, significant payments to marketing firms, undisclosed conflicts of interest, and misleading representations about asset classes and returns. This comes alongside prior freezing orders on Falcon, the fund, and its director David Anderson. ASIC has taken steps to protect investors and ensure an orderly wind down is managed under independent supervision.
A significant greenwashing penalty was handed down this month, with Active Super fined $10.5 million by the Federal Court. The fund had claimed it excluded high-risk sectors such as gambling, coal mining, and Russian-linked investments — yet evidence showed direct and indirect holdings in those very companies. The court criticised Active Super for misleading its members and relying on contrived arguments in its defence. The decision confirms ASIC’s greenwashing enforcement is not symbolic — it carries financial and reputational consequences.
ASIC has also acted against misconduct in capital markets and credit services. Behzad Eghrari, a Victorian man, has been charged with market manipulation after executing nearly 700 trades between accounts under his control — a practice known as ‘wash trading’ — to create a false appearance of active trading. Meanwhile, in the consumer credit space, ASIC secured a Federal Court victory against Sunshine Loans, confirming unlawful fees had been charged on small amount credit contracts. The matter is now returning to court for penalty determination.
Further enforcement was taken against 17 SMSF auditors in the second half of 2024, with ASIC disqualifying or cancelling registrations due to professional failings including lack of practical audit experience, CPD non-compliance, and breaches of independence requirements. ASIC is making it clear that the role of SMSF auditor is not administrative — it is foundational to maintaining integrity across $1 trillion in SMSF assets.
In a rare move, both ASIC and the Reserve Bank of Australia (RBA) have jointly intervened to address concerns with ASX’s CHESS settlement system, following a December batch settlement failure. The RBA downgraded ASX’s compliance rating on operational risk from ‘partly observed’ to ‘not observed’, while ASIC issued a formal directive requiring ASX to appoint an independent expert to review the CHESS platform. The regulators have flagged that further action may follow, including use of newly legislated powers under the Financial Market Infrastructure reforms if ASX fails to meet expectations.
Finally, ASIC published Regulatory Guide 280 on sustainability reporting, which outlines the new disclosure obligations for climate-related financial information under Chapter 2M of the Corporations Act. The guidance provides direction on scope, thresholds, scenario analysis, Scope 3 emissions, and governance responsibilities. ASIC has also confirmed a pragmatic approach during the implementation phase but made it clear that enforcement will follow where there is serious or reckless misconduct.
REGIONAL TRENDS TO WATCH
Across Hong Kong, Singapore, and Australia, regulators continue to tighten their focus on three key areas:
- Accountability & Conduct – Individuals and firms are being held to higher standards, with enforcement actions targeting unauthorised advice, dishonesty, and leadership failures.
- Risk Management & Controls – From cybersecurity lapses to IPO financing and margin risk, regulators expect robust systems, clear oversight, and proactive controls.
- Policy Modernisation – New frameworks are being rolled out to expand investor access (e.g. MAS’s retail private market fund proposals), improve transparency (SFC’s IPO rule changes), and support ESG disclosure (ASIC’s sustainability reporting guide).
The common thread: strong governance, clear documentation, and real compliance – not box-ticking.
For support navigating these developments — whether you need a gap analysis, mock inspection, or full compliance review — feel free to get in touch.
lach@gc-edge.com
