Hong Kong Securities And Futures Commission Reprimands And Fines Sino-Rich Securities & Futures Limited $2 Million And Suspends Its Responsible Officer For Failures In Relation To Margin Lending Practices

The Securities and Futures Commission (SFC) has reprimanded and fined Sino-Rich Securities & Futures Limited (Sino-Rich) $2 million for failures concerning its margin lending policy and practices (Note 1).

The SFC has also suspended the licence of Mr Budihardjo Wilhelm Soeharsono (Budihardjo), a responsible officer and a manager-in-charge of Sino-Rich, for five months and two weeks from 8 May 2025 to 22 October 2025 (Note 2).

The SFC’s investigation found that, between 1 December 2017 and 30 September 2019, Sino-Rich failed to adequately document its margin lending policy and strictly enforce a requirement that the credit limits of its clients were set by reference to objective proof of their net income or net worth.  The firm also failed to require written explanations to justify deviations from its margin lending policy.

The aforesaid failures of Sino-Rich constitute breaches of the Code of Conduct (Notes 3 and 4).

The SFC considers that Sino-Rich’s failures were attributable to Budihardjo’s failure to discharge his duties as a responsible officer and a member of the senior management of Sino-Rich.

In deciding the disciplinary sanctions against Sino-Rich and Budihardjo, the SFC took into account all relevant considerations, including the following:

• They were previously disciplined by the SFC in 2021 for Sino-Rich’s failures in complying with anti-money laundering and counter-terrorist financing regulatory requirements when handling cash deposits and third-party fund transfers (Note 5);

• Budihardjo was separately disciplined by the SFC in 2009 for his failures to properly and actively monitor clients’ trading activities as a responsible officer and senior management of another firm (Note 6);

• Sino-Rich has taken steps to remedy and improve its margin lending practices;

• Their cooperation with the SFC in resolving the SFC’s concerns; and

• Sino-Rich’s financial position (Note 7)

Notes:

1. Sino-Rich is licensed to carry on business in Type 1 (dealing in securities), Type 2 (dealing in futures contracts), Type 4 (advising on securities), Type 5 (advising on futures contracts) and Type 9 (asset management) regulated activities under the Securities and Futures Ordinance (SFO).
2. Budihardjo has been accredited to Sino-Rich to carry on Type 1 (dealing in securities), Type 2 (dealing in futures contracts), Type 4 (advising on securities), Type 5 (advising on futures contracts) and Type 9 (asset management) regulated activities under the SFO, and approved to act as its responsible officer since 22 August 2011.
3. Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission.
4. Details of the relevant provisions of the Code of Conduct are set out in the Statement of Disciplinary Action.
5. Please refer to the SFC’s press releases dated 15 March 2021 and 19 July 2021.
6. Please refer to the SFC’s press release dated 19 August 2009.
7. But for Sino-Rich’s financial position and cooperation with the SFC in resolving the SFC’s concerns, the SFC would have imposed a $3.5 million fine against it.