The Market Misconduct Tribunal (MMT) has sanctioned two former executives of Asia Telemedia Limited (ATML) (now known as Yunfeng Financial Group Limited) – Mr Charles Yiu Hoi Ying and Ms Marian Wong Nam – following legal proceedings brought by the Securities and Futures Commissions (SFC) (Note 1).
The MMT’s orders came after the Court of Final Appeal (CFA) allowed an appeal brought by the SFC which argued that the defence under section 271(3) of the Securities and Futures Ordinance (SFO) should not be applicable to Yiu and Wong and found them culpable of insider dealing in the shares of ATML (Notes 2 to 4).
The MMT made the following orders after the CFA remitted the matter to the tribunal to deal with sanctions:
- Yiu and Wong be banned from dealing in securities in Hong Kong for three years, effective from 15 April 2021;
- Yiu be disqualified from being a director or being involved in the management of a listed company for three years, effective from 15 April 2021;
- Yiu not to engage in insider dealing and Wong not to engage in any conduct which constitutes market misconduct again;
- the losses of $3,123,329.02 and $1,076,937.97 avoided by Yiu and Wong, respectively, in their insider dealing of ATML shares be disgorged;
- Yiu and Wong to pay the SFC’s investigation and legal costs, as well as the costs of the MMT proceedings; and
- the MMT report be referred to the Hong Kong Institute of Chartered Secretaries with a recommendation to take disciplinary action against Wong (Notes 5 to 10).
The MMT also awarded Mr Lu Ruifeng, former chairman and executive director of ATML, and Ms Cecilia Ho King Lin, former assistant company secretary of ATML, with legal costs for reasons that they were not identified as persons who had engaged in market misconduct in the same legal proceedings brought by the SFC against Yiu and Wong (Note 11).
The legal proceedings in the Court of First Instance under section 213 of the SFO against Lu for his alleged insider dealing in ATML shares remains afoot.
End
Notes:
- The MMT was heard before the MMT Chairman, Mr Michael Hartmann, GBS, and two lay members, Dr Chu Keung Wah and Mr Chan Sai Hung.
- The MMT’s decision and a report which sets out the reasons of making the relevant orders is available on the MMT’s website (www.mmt.gov.hk) and a copy of the CFA judgment can also be found on the judiciary website (https://legalref.judiciary.hk/lrs/common/ju/ju_frame.jsp?DIS=117866).
- Please see the SFC’s press releases dated 2 May 2008, 5 November 2008, 6 December 2010, 29 January 2014, 26 November 2015, 28 April 2017, 24 August 2017 and 12 October 2018.
- Section 271(3) of the SFO provides that a person should be acquitted if he did not have a purpose of making profit by using inside information.
- Under section 257(1)(a) of the SFO, an order prohibiting a person to take part in the management of a listed company without the leave of the Court of First Instance.
- Under section 257(1)(b) of SFO, an order has the effect of prohibiting a person who is the subject of the order from any dealings, directly or indirectly, in the Hong Kong financial market for the length of the order.
- Under section 257(1)(c) of the SFO, an order to prohibit a person who is the subject of the order not to engage in any form of market misconduct in the future.
- Under section 257(1)(d) of the SFO, an order that the person shall pay to the Government an amount of any profit gained or loss avoided by the person as a result of the market misconduct in question.
- Under sections 257(1)(e) and (f) of the SFO, orders that a person shall pay costs incurred by the Government and the SFC.
- Under section 257(1)(g) of the SFO, an order that anybody which may take disciplinary action against the person as one of its members be recommended to take disciplinary action against him.
- Lu was not identified as a person who had engaged in market misconduct because he was not given a reasonable opportunity to be heard pursuant to section 252(6) of the SFO.
