Insider Dealing in Hong Kong
Insider dealing in Hong Kong
Although insider dealing has been a criminal offence under section 291 of Chapter 571, Securities and Futures Ordinance (SFO) in Hong Kong since 2003, the Securities and Futures Commission (SFC) was initially slow to prosecute offenders, commencing its first criminal insider dealing prosecution only in January 2008.
Factors to be considered to commence criminal proceedings
In deciding whether to commence criminal proceedings against an alleged insider dealer, the SFC will have regard to the guidelines in the prosecution policy of the Department of Justice, which require two basic factors to be considered:
1. Sufficiency of evidence
The burden of proof is greater in criminal proceedings and the SFC will generally only recommend criminal proceedings where there is admissible, substantial and reliable evidence that an offence has been committed and there is a reasonable prospect of a conviction. Where there is a lack of sufficient evidence to meet the criminal burden of proof, the SFC is likely to initiate civil proceedings.
2. Public interest
Whether, taking into account the circumstances of a particular case, it is in the public interest to bring a prosecution before the courts.
First Criminal Case of Insider Dealing in Hong Kong
In the case of HKSAR v Ma Hon-yeung (DCCC 229-240/2008) which involved Ma Hon-yeung, former Vice President of BNP Paribas Peregrine Capital Ltd, now known as BNP Paribas Capital (Asia Pacific) Ltd (BNP Paribas), an investment bank.
The case is related to trading in the shares of Egana Jewellery & Pearls Ltd ("Egana"), a listed company in Hong Kong prior to an announcement made to the market on 11 Jul 2006 aboutprivatization of the company.
Ma Hon-yeung learned of a proposed privatization of Egana and tipped off his girlfriend, Ivy Lo Yuk-wah and three other family members, Sammy Ma Hon-kit, Cordelia Tso Kin-wah and Ronald Ma Chun-ho, within days of becoming privy to the
Although insider dealing has been a criminal offence under section 291 of Chapter 571, Securities and Futures Ordinance (SFO) in Hong Kong since 2003, the Securities and Futures Commission (SFC) was initially slow to prosecute offenders, commencing its first criminal insider dealing prosecution only in January 2008.
Factors to be considered to commence criminal proceedings
In deciding whether to commence criminal proceedings against an alleged insider dealer, the SFC will have regard to the guidelines in the prosecution policy of the Department of Justice, which require two basic factors to be considered:
1. Sufficiency of evidence
The burden of proof is greater in criminal proceedings and the SFC will generally only recommend criminal proceedings where there is admissible, substantial and reliable evidence that an offence has been committed and there is a reasonable prospect of a conviction. Where there is a lack of sufficient evidence to meet the criminal burden of proof, the SFC is likely to initiate civil proceedings.
2. Public interest
Whether, taking into account the circumstances of a particular case, it is in the public interest to bring a prosecution before the courts.
First Criminal Case of Insider Dealing in Hong Kong
In the case of HKSAR v Ma Hon-yeung (DCCC 229-240/2008) which involved Ma Hon-yeung, former Vice President of BNP Paribas Peregrine Capital Ltd, now known as BNP Paribas Capital (Asia Pacific) Ltd (BNP Paribas), an investment bank.
The case is related to trading in the shares of Egana Jewellery & Pearls Ltd ("Egana"), a listed company in Hong Kong prior to an announcement made to the market on 11 Jul 2006 aboutprivatization of the company.
Ma Hon-yeung learned of a proposed privatization of Egana and tipped off his girlfriend, Ivy Lo Yuk-wah and three other family members, Sammy Ma Hon-kit, Cordelia Tso Kin-wah and Ronald Ma Chun-ho, within days of becoming privy to the