Hong Kong Securities And Futures Commission: Retail Investor Convicted And Fined For Illegal Short Selling

The Eastern Magistrates’ Court today convicted Mr Lau Chi Ho after he pleaded guilty to illegal short selling in prosecutions brought by the Securities and Futures Commission (SFC).

Lau was fined $20,000 and ordered to pay the SFC’s investigation costs.

The Court heard that on two occasions on 12 June 2019 and 26 June 2019, Lau placed orders to sell shares of two listed securities on the Stock Exchange of Hong Kong Limited when he did not have any of those shares.  He later bought back the shares to cover his short sold positions (Note 1).

Note:

1. Section 170(1) of the Securities and Futures Ordinance prohibits the sale of securities when the person does not have, or does not believe or does not have reasonable grounds to believe that he has a presently exercisable and unconditional right to vest the securities in the purchaser of them.