Hong Kong Watchdog Collected Fines Totalling More Than $1 Million In Q4 2016 - Report

Josh O'Neill

20 February 2017

A Hong Kong regulator in the fourth quarter of last year collected HK$9.8 million in fines and disciplined five institutions and 11 licensed representatives, which included JP Morgan, Deutsche Bank and HSBC, the Securities and Futures Commission’s quarterly report showed.

JP Morgan Securities and JP Morgan Chase Bank were reprimanded and fined HK$3 million and HK$2.6 million respectively over regulatory breaches in “a number of areas”, the financial watchdog said.

Derek Ong, a former representative of Deutsche Bank Securities Asia, was banned from re-entering the financial services industry for 10 years after the SFC found he conspired to manipulate the Korean Composite Stock Price Index 200.

Chen Chia Hui, a former employee of HSBC, was banned from re-entering the financial services industry for life after she was convicted of bribery, the SFC said. Lam Yuk Wai, a former staff member of four HSBC-owned broking companies, was also banned from the industry for life after the SFC discovered he processed more than 100 unauthorised transactions.

The SFC revoked the licences of Richmond Asset Management and its sole owner Graham Bibby, who was also banned from re-entering the financial services industry for 10 years, after an investigation revealed he and his firm solicited clients to invest in a Thailand-based company and plot of land in which he and his wife held “substantial undisclosed interests”.

FXCM Asia was reprimanded and slapped with a HK$4 million penalty over regulatory breaches relating to its foreign exchange order execution practices.

Benedict Ku Ka Tat, a former employee of The Pride Fund Management, was prohibited from re-entering the financial services industry for one year and fined HK$150,000 after he failed to disclose his commission did not perform proper customer due diligence, the SFC found.

The SFC revoked the licences of Goodscape Securities and its responsible officers, Tang Lin Sun and Chang Siu Ming, after it discovered they misappropriated client funds. Tang and Chang were banned from re-entering the financial services industry for life and three years, respectively.

Meanwhile, the total number of licensed corporations, individuals and registered institutions reached a record-high of 42,665, the SFC’s report showed. The number of licensed corporations rose 11 per cent to 2,411.

The SFC said it carried out 89 risk-based on-site inspections on licensed corporations in the fourth quarter of 2016 in order to review their compliance with relevant regulatory requirements.