Hong Kong's Securities And Futures Commission Suspends Ko Cho Ting For Two Years

The Securities and Futures Commission (SFC) has suspended Mr Ko Cho Ting for two years from 2 August 2016 to 1 August 2018 for executing suspicious client orders and operating a secret securities account.

The disciplinary action follows an SFC investigation which found that Ko placed suspicious bid orders for the shares of Timeless Software Limited (Timeless) for one of his clients. From 1 May to 28 June 2012, the client placed a small order for Timeless shares during the last two minutes of the Continuous Trading Session on 18 trading days and 17 of these late orders were the last order of the day that set a higher closing price for Timeless shares (Note 2).

Although Ko suspected that the late orders might inflate the closing price of Timeless shares and be considered to be manipulative, Ko acted in accordance with the client’s instructions and made no proper inquiries or took no step to escalate the orders to the management of his firm.

The SFC investigation also reveals that Ko has breached his firm’s employee dealing policy by failing to disclose a personal securities trading account and the securities transactions conducted therein.

By knowingly placing suspicious orders to the market for his client, Ko is not acting in the best interest of market integrity and his conduct fell short of the standard expected of him (Note 3).

End

Notes:

1. Ko was licensed as a representative under the Securities and Futures Ordinance to carry on Type 1 (dealing in securities) and Type 2 (dealing in futures contracts) regulated activities and was accredited to Emperor Securities Limited since 6 October 1994.
2. The Continuous Trading Session comprises the Morning Session between 09:30am and 12:00 noon and the Afternoon Session between 01:00pm and 04:00pm. The last two minutes of the Continuous Trading Session refer to two minutes from 3:58:00pm.
3. General Principle 1 of the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission requires licensed persons to act honestly, fairly and in the best interest of market integrity.