The Eastern Magistrates’ Courts today convicted Mr Lin Tai Fung and his brother-in-law, Mr Or Chun Nin after they pleaded guilty to the offences of conspiracy to commit false trading in the shares of Pa Shun International Holdings Limited (Pa Shun) from 9 April 2017 to 7 March 2018 in a prosecution brought by the Securities and Futures Commission (SFC) (Notes 1 to 3).
The Court also convicted Lin for failing to notify SEHK of changes in his interest in the shares of Pa Shun on eight occasions between 2 June 2017 and 14 March 2018 after he pleaded guilty to the offences (Note 4).
At the material time, Lin conspired with Or to purchase shares of Pa Shun to maintain the closing share price at or above a certain level.
On eight occasions, Lin’s trading in Pa Shun shares resulted in a change in his level of shareholding, which triggered a duty of disclosure to SEHK and Pa Shun. However, Lin has yet to make the required disclosures to SEHK and Pa Shun.
The Court adjourned the case to 10 June 2025 for sentence. They were granted bail on these conditions: (i) cash bail of $20,000 and (ii) surety of $50,000.
The SFC’s Executive Director of Enforcement, Mr Christopher Wilson, said: “The market price of a stock should reflect genuine supply and demand. Fixing an artificial closing price prevents the market from re-establishing a genuine price and it may create a false appearance of the stock’s attractiveness to investors. The SFC has zero tolerance to any market malpractice undermining market confidence and integrity.”
Notes:
- Pa Shun, formerly known as Pa Shun Pharmaceutical International Holdings Limited, was listed on the Main Board of The Stock Exchange of Hong Kong Limited (SEHK) in 2015.
- Contrary to section 295 of the Securities and Futures Ordinance (SFO) and sections 159A and 159C of the Crimes Ordinance.
- Please see the SFC’s press releases dated 23 January 2025 and 20 March 2025.
- Contrary to section 328 of the SFO.
