Regulatory Enforcement and Investigations

Overview

The global financial crisis in 2008 prompted regulators to adopt a more aggressive approach to the enforcement of standards of business conduct. The result has been increasing concern amongst participants of the financial markets of the risks of non-compliance.

As a firm, we have a market leading practice in defending and otherwise representing our clients in all manner of contentious interactions with the regulators, from enquiries and formal investigations through to prosecution action, whether undertaken by the Securities and Futures Commission ("SFC"), the Hong Kong Monetary Authority ("HKMA"), the Stock Exchange of Hong Kong ("SEHK") or insurance regulators. We have appeared on behalf of clients before the administrative bodies responsible for hearing appeals from decisions of these regulators and before the courts in matters of the legal correctness of their decisions. We have significant experience in defending clients in Market Misconduct Tribunal proceedings, having represented clients in a number of pioneering cases setting market precedent.

Our experience covers a broad spectrum of issues including mis-selling, insider dealing, market manipulation, and disclosure of interests. We have a range of experience with different sectors, including listed companies and their directors, asset managers and their portfolio managers and banks and their traders, analysts and relationship managers. As a result, we bring to each matter not only a deep understanding of the commercial context in which allegations of wrongdoing are made but also a strong understanding of the technical requirements of the regulatory framework and the regulatory approach to those requirements.

Much of the work that we have done for our clients is unknown to the public. We are well known for our desire to end enforcement action at the earliest stage possible without trial or publicity as well as for our robust and innovative solutions. We are often called upon to balance not only the need to limit regulatory enforcement action which may result in civil, criminal or administrative consequences but the need to manage civil liabilities to clients as a result of alleged misconduct.

Experience

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  • Advising a leading Swiss private banking group with assets under management in excess of 350 billion Swiss Francs in connection to Hong Kong regulatory issues related to dealing in listed index options

  • Advising an NYSE listed asset management firm in connection with Hong Kong short selling reporting requirements

  • Advising a private wealth management group in Asia in connection with an SFC investigation regarding suitability and record keeping

  • Advising a PRC based asset management firm with operations in Hong Kong and the mainland of China with almost USD$9 billion of assets under management in respect of possible statutory and non-statutory regulatory breaches in connection with a field audit conducted by the regulator

  • Advising a leading global operator of cash and derivative cryptocurrency exchange with over USD1.5 billion of daily digital asset trading volume in connection with regulatory enquiries and an investigation in relation to its online platform for trading cryptocurrency derivative products

  • Advising and representing a Greater China focused private wealth management group in connection with an SFC investigation as to whether or not the real estate investment arrangements marketed by the client constituted a collective investment scheme under the Securities and Futures Ordinance

  • Advising and representing a former trader of a hedge fund manager in connection with an SFC investigation in connection with possible offences of false trading, price rigging, and stock market manipulation

  • Advising a SFC licensed multi-family office with an SFC investigation in connection with alleged lack of internal controls and non-compliance with client mandate

  • Representing the non-executive chairman of AcrossAsia before the MMT regarding late disclosure of price sensitive information

  • Representing a high profile activist short seller before the MMT regarding the disclosure of false or misleading information

  • Representing a private fund manager and its director in respect of an appeal to the Court of Final Appeal in respect of the proper interpretation of the provisions of Hong Kong securities laws governing offers of investments to professional investors

  • Representing a high profile activist short seller before the Court of Appeal in respect of the proceedings which the SFC commenced before the Market Misconduct Tribunal

  • Representing a stock brokerage firm regulated by the SFC in connection with an arbitration regarding claims by a client for restitution based on allegations of fraudulent and unauthorized loss of client assets

  • Advising a leading Swiss private banking group with assets under management in excess of 350 billion Swiss Francs in connection to Hong Kong regulatory issues related to dealing in listed index options

  • Advising an NYSE listed asset management firm in connection with Hong Kong short selling reporting requirements

  • Advising a private wealth management group in Asia in connection with an SFC investigation regarding suitability and record keeping

  • Advising a PRC based asset management firm with operations in Hong Kong and the mainland of China with almost USD$9 billion of assets under management in respect of possible statutory and non-statutory regulatory breaches in connection with a field audit conducted by the regulator

  • Advising a leading global operator of cash and derivative cryptocurrency exchange with over USD1.5 billion of daily digital asset trading volume in connection with regulatory enquiries and an investigation in relation to its online platform for trading cryptocurrency derivative products

  • Advising and representing a Greater China focused private wealth management group in connection with an SFC investigation as to whether or not the real estate investment arrangements marketed by the client constituted a collective investment scheme under the Securities and Futures Ordinance

  • Advising and representing a former trader of a hedge fund manager in connection with an SFC investigation in connection with possible offences of false trading, price rigging, and stock market manipulation

  • Advising a SFC licensed multi-family office with an SFC investigation in connection with alleged lack of internal controls and non-compliance with client mandate

  • Representing the non-executive chairman of AcrossAsia before the MMT regarding late disclosure of price sensitive information

  • Representing a high profile activist short seller before the MMT regarding the disclosure of false or misleading information

  • Representing a private fund manager and its director in respect of an appeal to the Court of Final Appeal in respect of the proper interpretation of the provisions of Hong Kong securities laws governing offers of investments to professional investors

  • Representing a high profile activist short seller before the Court of Appeal in respect of the proceedings which the SFC commenced before the Market Misconduct Tribunal

  • Representing a stock brokerage firm regulated by the SFC in connection with an arbitration regarding claims by a client for restitution based on allegations of fraudulent and unauthorized loss of client assets

Awards

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  • Corporate INTL Magazine

    Regulatory Law Firm of the Year in Hong Kong

    Financial Services Regulatory

  • Chambers & Partners

    Leading Practice

    Financial Services Regulatory

  • Chambers & Partners

    Leading Individual

    Financial Services Regulatory

  • Legal 500

    Leading Individual

    Financial Services Regulatory

  • Legal 500

    "Recommended Practice"

    Financial Services Regulatory

  • IFLR 1000

    Leading Practice

    Financial Services Regulatory

  • Asialaw Profiles

    Leading Practice

    Financial Services Regulatory

  • Asialaw Profiles

    Market-Leading Lawyer

    Financial Services Regulatory

  • Chambers & Partners

    Leading Lawyer

    Financial Services Regulatory

  • Asialaw Leading Lawyers

    Market-Leading Lawyer

    Financial Services Regulatory

  • Asialaw Profiles

    Outstanding Practice

    Financial Services Regulatory

  • IFLR 1000

    "Positively Ranked"

    Financial Services Regulatory

  • IFLR 1000

    Highly Regarded Lawyer

    Financial Services Regulatory

  • Chambers & Partners

    Well Regarded Lawyer

    Financial Services Regulatory

  • Corporate INTL Magazine

    Regulatory Law Firm of the Year in Hong Kong

    Financial Services Regulatory

  • Chambers & Partners

    Leading Practice

    Financial Services Regulatory

  • Chambers & Partners

    Leading Individual

    Financial Services Regulatory

  • Legal 500

    Leading Individual

    Financial Services Regulatory

  • Legal 500

    "Recommended Practice"

    Financial Services Regulatory

  • IFLR 1000

    Leading Practice

    Financial Services Regulatory

  • Asialaw Profiles

    Leading Practice

    Financial Services Regulatory

  • Asialaw Profiles

    Market-Leading Lawyer

    Financial Services Regulatory

  • Chambers & Partners

    Leading Lawyer

    Financial Services Regulatory

  • Asialaw Leading Lawyers

    Market-Leading Lawyer

    Financial Services Regulatory

  • Asialaw Profiles

    Outstanding Practice

    Financial Services Regulatory

  • IFLR 1000

    "Positively Ranked"

    Financial Services Regulatory

  • IFLR 1000

    Highly Regarded Lawyer

    Financial Services Regulatory

  • Chambers & Partners

    Well Regarded Lawyer

    Financial Services Regulatory

Insights

  • Heightened Regulation of the Stock Market: What Directors of Listed Companies Need to Know

    The Securities and Futures Commission (“SFC”) and The Stock Exchange of Hong Kong Limited (“SEHK”) both shifted their enforcement strategies and priorities after the conclusion of their joint consultation in 2017 in relation to the regulation of listed companies. The SEHK has stepped up the number of investigations it conducts and the number of resulting sanctions has risen accordingly. At the same time, the SFC has adopted a more pro-active role in exercising its statutory powers to pre-empt corporate misfeasance.

  • Capital Markets Hong Kong IPOs: A Broken Regime?

    The efforts of the Securities and Futures Commission to eliminate financial fraud perpetrated by Hong Kong listed companies and their directors is laudable. What is unclear is why they have chosen to focus almost exclusively on the sponsors who have brought these companies to the market. This unnatural preoccupation with the sponsors sends an unfortunate message that directors engaged in fraud have nothing to fear but the remote risk that they will be deprived of their ill-gotten gains and that auditors have little, if any, responsibility for assuring the public as to the financial position of these companies.