SFC Updates
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SFC Bans Bernie Wong Ching Man For Four Months
The Securities and Futures Commission (SFC) has prohibited Ms Bernie Wong Ching Man, a former employee of Citibank (Hong Kong) Limited, from re-entering the industry for four months from 19 May 2017 to 18 September 2017 for forging a client’s signature (Note 1).
The SFC found that in July 2015, Wong forged a customer’s signature on a credit card application form after she had agreed to have the credit card ready for collection by the customer on a specific date, but found that the customer had not signed on the form. Wong did not receive any personal benefit or pecuniary advantage from the forgery (Note 2).
The SFC considers that Wong is not a fit and proper person to be licensed or registered to carry on regulated activities.
The case was referred to the SFC following an investigation by the Hong Kong Monetary Authority.
Notes:
- Wong was a relevant individual engaged by Citibank (Hong Kong) Limited (Bank) to carry on Type 1 (dealing in securities) and Type 4 (advising on securities) regulated activities under the Securities and Futures Ordinance between 19 June 2014 and 15 July 2015. Wong is currently neither registered with the Hong Kong Monetary Authority nor licensed by the SFC.
- The Bank did not report the incident to the police since there was no loss suffered by the customer or the Bank.
SFC Suspends Hui Lam Chiu For Six Months
The Securities and Futures Commission (SFC) has suspended Mr Hui Lam Chiu, a former responsible officer of Guoyuan Securities Brokerage (Hong Kong) Limited (Guoyuan), for six months from 19 May 2017 to 18 November 2017 (Note 1).
The disciplinary action follows the SFC’s sanction against Guoyuan over its breach of the anti-money laundering guidelines in failing to conduct proper enquiries and scrutiny to mitigate the risks of money laundering and terrorist financing when processing third party fund deposits and withdrawals for clients between September 2010 and July 2012 (Note 2).
Hui was the responsible officer and senior management officer responsible for handling and approving the third party fund transfers at Guoyuan during the relevant period. He was also one of the personnel responsible for ensuring that the third party fund transfers were in compliance with anti-money laundering requirements.
The SFC found that Guoyuan’s breaches were partly attributable to Hui’s failure to discharge his duties as a responsible officer and a member of Guoyuan’s senior management in ensuring all reasonable measures were taken to mitigate the risks of money laundering and terrorist financing. In particular, Hui failed to ensure that:
- Guoyuan conducted proper enquiries and followed up on some of the third party fund transfers despite the presence of a number of red flags suggesting that they were unusual and/or potentially suspicious; and
- Guoyuan’s procedures for dealing with third party fund transfers were effectively employed to ensure that the risks of money laundering could be mitigated (Note 3).
In deciding the disciplinary sanction, the SFC took into account all relevant circumstances, including Hui’s cooperation with the SFC in resolving the SFC’s concerns and Hui’s otherwise clean disciplinary record.
Notes:
- Hui was licensed under the Securities and Futures Ordinance to carry on Types 1 (dealing in securities) and 4 (advising on securities) regulated activities and was accredited to Guoyuan between 28 August 2008 and 25 June 2012. Hui is currently accredited to another licensed corporation.
- Please refer to the SFC’s press release dated 5 April 2017.
- General Principle 7 of the Code of Conduct for Persons Licensed by or Registered with the SFC (Code of Conduct) requires a licensed person to comply with all regulatory requirements applicable to the conduct of his business activities. General Principle 9 and paragraph 14.1 of the Code of Conduct requires a licensed person to manage the risks associated with the firm’s business and properly discharge his responsibility as a responsible officer and a member of senior management of the firm.
- Licensed corporations are reminded to refer to the “Circular to Licensed Corporations and Associated Entities – Anti-Money Laundering / Counter Financing of Terrorism (AML/CFT) Compliance with AML/CFT Requirements” issued by the SFC on 26 January 2017 which sets out key areas of concern identified by the SFC in its review of some licensed corporations’ AML/CFT systems.
SFC bans Tsap Wai Ping for two years
The Securities and Futures Commission (SFC) has prohibited Mr Tsap Wai Ping from re-entering the industry for two years from 19 May 2017 to 18 May 2019 for fitness and properness concerns (Note 1).
The SFC found that between June and September 2012, Tsap caused invitations to subscribe for the shares in Yinfu Gold Corporation (Yinfu) to be issued to the investing public without authorization from the SFC. At the material time, Tsap was the President, CEO and Sole Director of Yinfu, whose shares were traded on the OTC Pink Marketplace in the United States. A total of 140 share subscriptions were made by 65 Hong Kong subscribers involving 13 million of Yinfu shares and US$1.3 million of subscription proceeds (Notes 2 & 3).
In the circumstances, the SFC considers Tsap’s conduct casted serious doubts on his fitness and properness to be a licensed person.
Notes:
- Tsap was licensed under the Securities and Futures Ordinance (SFO) to carry on Type 1 (dealing in securities) regulated activities and was accredited to Chinawide Securities Limited until July 2012. He is not currently licensed by the SFC.
- At the material time, Yinfu was a company registered in the state of Wyoming in the United States.
- Referring to the legislative provisions in force during the material period, under section 103(1) of the SFO, it is unlawful for any person to issue an invitation which contains an invitation to the public to enter into an agreement to subscribe for securities unless the issue is authorized by the SFC. In addition, under section 342(3) of the Companies Ordinance (CO), it is unlawful to issue to any person in Hong Kong a form of application for shares of a company incorporated outside Hong Kong unless the form is issued with a prospectus that complies with the requirements specified in the Third Schedule to the CO. Yinfu did not issue a prospectus with the form of application for the shares.
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