HK’s securities watchdog freezes brokerage accounts for suspected involvement in misleading data

18-Feb-2019 Intellasia | South China Morning Post | 6:00 AM Print This Post

Hong Kong’s securities watchdog has frozen an unknown number of client accounts managed by three brokerages which were related to the suspected disclosure of false or misleading financial information by a listed company.

The Securities and Futures Commission (SFC) has issued restriction notices that prohibit Changjiang Securities Brokerage, Haitong International Securities Company and Kingston Securities from dealing with assets held in those accounts, it said in a statement on Friday.

The brokerages are not the focus of the SFC’s investigation, the SFC said. Their operations and other clients will not affected.

Financial watchdog SFC vows to stamp out ‘fake’ stockbroker trading accounts

The listed company, which was not named by the SFC, is suspected to have disclosed false or misleading financial information in various announcements, annual results and annual reports.

The SFC has over the past few months intensified its crackdown on market misconduct including corporate fraud, corruption, and substandard work by sponsors of initial public offerings.

In September, the SFC froze HK$10.17 billion (US$1.3 billion) worth of assets owned by an unnamed chair of a listed company who has been under corruption investigation in mainland China.

Thomas Atkinson, executive director of the SFC and head of its enforcement division, said in an October speech that the regulator planned to sue 60 companies and individuals in the first half of 2019, which would be the largest legal action in the organisation’s history.

Hong Kong markets watchdog to sue 60 companies and individuals for corporate fraud in first half of 2019

Some of the most serious cases involved nefarious groups of inter-connected companies that coordinate to defraud and exploit investors through means such as fake transactions, Atkinson said.

The SFC has suspended the trading of 14 listed companies that were among the 136 companies it was investigating, Atkinson said.

The SFC has also investigated 30 cases of suspected listing sponsor misconduct, which involved 28 sponsor firms and 39 applications, he said.


Category: Hong Kong

Print This Post

Comments are closed.