The Securities and Futures Commission (SFC) has banned Ms Zhu Hong, a substantial shareholder, director and former manager-in-charge of core functions (MIC) of Kylin International (HK) Co., Limited (Kylin), from engaging in any regulated activities for 12 months from 16 August 2025 to 15 August 2026 and fined her $400,000 for failures in managing various private funds (Notes 1 to 3).
Between August 2018 and July 2021, Kylin was the investment manager and/or consultant of sub-funds of a Cayman-incorporated fund (Note 4). At the material time, Zhu was responsible for, among other things, approving borrowing agreements on behalf of the sub-funds and implementing internal control procedures to prevent money laundering and terrorist financing. The SFC’s investigation revealed that Zhu had failed to discharge her duties as Kylin’s director and MIC for AML/CTF in managing the funds in question.
In deciding the sanction, the SFC took into account Zhu’s acceptance of liability, her remorsefulness, as well as her otherwise clean disciplinary record.
Notes:
- Kylin was licensed under the Securities and Futures Ordinance (SFO) to carry on Type 9 (asset management) regulated activity from 4 April 2014 to 22 January 2025. It ceased carrying on regulated activities on 31 December 2023. Following its application, the SFC revoked its licence on 22 January 2025.
- Zhu was Kylin’s MIC for (i) Anti-Money Laundering and Counter-Terrorist Financing (AML/CTF); (ii) Risk Management; and (iii) Finance and Accounting during different periods between 30 April 2019 and 22 January 2025.
- While Zhu has not been a licensed person under the SFO, she falls within the definition of a “regulated person” under section 194(7) of the SFO, which includes a person who is, or was at the relevant time, involved in the management of the business of a licensed corporation.
- The SFC’s disciplinary action against Zhu is related to its disciplinary action against another related entity concerning the management of the funds in question. As the disciplinary action against that entity is still in progress, the SFC will not disclose the details of its disciplinary action against Zhu until the conclusion of its action against that entity.
