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Securities and Futures Commission commences Market Misconduct Tribunal proceedings against former CEO of SkyNet Group Limited (formerly known as China AU Group Holdings Limited at the material time) and related parties for false trading

  • Hong Kong
  • Asia
  • Financial services disputes and investigations

09-09-2016

On 9 September 2016, the Securities and Futures Commission (SFC) announced that it had commenced proceedings in the Market Misconduct Tribunal (MMT) against Ms. Samantha Keung Wai Fun (the former CEO of China AU Group Holdings Limited (China AU)), Ms. Wu Hsiu Jung and Mr. Chen Kuo-chen (collectively the Defendants) for false trading in the shares of China AU listed on the Growth Enterprise Market of the Stock Exchange of Hong Kong Limited.

The SFC alleges that between August 2009 and March 2010, coinciding with the launch of two fundraising exercises of China AU, the Defendants used 14 securities accounts in their own names and in the names of others to trade in the shares of China AU which did not result in changes of beneficial ownership and/or was coordinated between the counterparties and/or created a false or misleading appearance of active trading to supported China AU’s fundraising activities.

This SFC action follows on their successful action last year against a former licensee of Ping An of China Securities (Hong Kong) Company Limited for false trading in the shares of Sino-Tech International Holdings Limited. This former licensee was sentenced to 240 hours of community service, banned from dealing in any securities for 2 years and banned from re-entering the financial industry for 8 years. Mark Steward, who at that time was the SFC executive director of enforcement, said “Falsifying the market for or the price of securities misleads the investment public and is dishonest. The SFC will continue to prosecute deliberate and dishonest manipulation and offenders can expect to receive terms of imprisonment.”

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