The Securities and Futures Commission (SFC) has banned Mr Yan Chee Yung, a former employee of Chong Hing Securities Limited, from re-entering the industry for life for defrauding his clients and misappropriating client money (Note 1).
The disciplinary action follows an SFC investigation which found that, between June 2006 and February 2014, Yan:
- misrepresented to 18 clients of Chong Hing Securities Limited and Chong Hing Bank Limited that he could buy shares on their behalf at a price lower than market price and/or promised them that he would buy back the shares at a guaranteed price, and induced the clients to enter into private investment arrangements with him;
- induced the clients to give him money to buy shares on their behalf and misappropriated their money and used it for his own personal expenses, gambling and settling credit card debts; and
- falsified transaction records to gain the clients’ trust.
The SFC considers that Yan’s conduct demonstrates a serious lack of honesty and integrity and concludes that Yan is guilty of misconduct and his fitness and properness to be licensed has been called into question.
In deciding the sanction, the SFC took into account all relevant circumstances including that:
- Yan’s misconduct was gravely dishonest and lasted for more than seven years;
- he abused the trust which his clients placed in him and his actions resulted in losses to the clients;
- he admitted his misconduct during the SFC’s investigation; and
- he had an otherwise clean disciplinary record.
The District Court today sentenced Yan to imprisonment of 36 months after he was convicted of 18 counts of theft in relation to the misappropriation of approximately $6.9 million from clients following an investigation by the police.
Note:
- Yan was licensed under the Securities and Futures Ordinance to carry on Type 1 (dealing in securities) regulated activity and was accredited to Chong Hing Securities Limited between 10 January 2011 and 11 February 2014. He was also a relevant individual engaged by Chong Hing Bank Limited to carry on Type 1 (dealing in securities) regulated activity between 1 April 2003 and 10 February 2014, and Type 4 (advising on securities) regulated activity between 1 April 2003 and 31 December 2010. Yan is currently not licensed by the SFC or registered with the Hong Kong Monetary Authority.
A copy of the Statement of Disciplinary Action is available on the SFC website