Hong Kong SFC & ICAC Conduct Joint Operation on Syndicate for Market Manipulation of Hong Kong-Listed Company & Corrupt Practices, Syndicate Conspired to Claim Hong Kong-Listed Company to Form $2.5 Million Joint Venture with China Mainland Company & Entered into Share Subscription Agreement, Arrested Hong Kong-Listed Company ex-Chairman & ex-Executive Director (Also Director of a Broker) for Bribery, ex-Executive Director Had Also Misappropriated $1.1 Million (HKD 9 Million) Shares
26th July | Hong Kong
The Hong Kong Securities & Futures Commission (SFC) and the Independent Commission Against Corruption (ICAC) have conducted a joint operation on a syndicate for market manipulation of a Hong Kong-listed company & corrupt practices, with the syndicate conspiring to claim the Hong Kong listed company to be forming a $2.5 million joint venture with a China Mainland company & entered into a share subscription agreement. The ICAC has arrested Hong Kong-listed company ex-Chairman & ex-Executive Director (also Director of a Broker) for bribery, and the ex-Executive Director had also misappropriated $1.1 million (HKD 9 million) shares. Announcement (25/7/25): “The Securities and Futures Commission (SFC) and the Independent Commission Against Corruption (ICAC) on Wednesday (23 July 2025) conducted a joint operation, codenamed “Leverage”, targeting a sophisticated syndicate suspected of manipulating the shares of a listed company and engaging in corrupt activities (Notes 1 and 2). During the joint operation, the SFC and the ICAC searched 14 locations, including the offices of the listed company and SFC-licensed brokers. The ICAC arrested a former chairman and a former executive director of the listed company under the Prevention of Bribery Ordinance (Note 3). The syndicate allegedly conspired to use documents containing false information, including internal records and public announcements of the listed company, to falsely claim that the listed company had entered into a share subscription agreement and formed a joint venture with a Mainland company involving amounts exceeding HK$20 million. Additionally, the syndicate allegedly manipulated and/or created false market appearance for the shares of the listed company through multiple nominee accounts. Furthermore, the former executive director of the listed company, who was also a responsible officer and director of a broker at the material time, was suspected of accepting advantages from the former chairman of the listed company and misappropriating shares owned by a client of the broker worth approximately HK$9 million. The joint operation was the result of the SFC’s initial detection of suspicious trading activities suggesting potential market misconduct and corruption. The case was subsequently referred to the ICAC for investigation into suspected corruption, while the SFC focused on market misconduct under the SFO. No further comments will be provided as the investigation remains ongoing.”
“ Hong Kong SFC & ICAC Conduct Joint Operation on Syndicate for Market Manipulation of Hong Kong-Listed Company & Corrupt Practices, Syndicate Conspired to Claim Hong Kong-Listed Company to Form $2.5 Million Joint Venture with China Mainland Company & Entered into Share Subscription Agreement, Arrested Hong Kong-Listed Company ex-Chairman & ex-Executive Director (Also Director of a Broker) for Bribery, ex-Executive Director Had Also Misappropriated $1.1 Million (HKD 9 Million) Shares “
Notes:
- Trading in shares of the listed company has been suspended since March 2025, following a court order mandating its liquidation.
- The joint operation was conducted under the framework of the Memorandum of Understanding signed between the SFC and the ICAC. For further details, please visit the websites of the SFC and the ICAC.
- The individuals implicated are suspected of breaching the provisions under the Prevention of Bribery Ordinance, including offering advantages to agents and agents accepting advantages (i.e., offering and acceptance of bribes), as well as agents using false documents with the intent to deceive their principals. Additionally, they are suspected of committing offences under the Organized and Serious Crimes Ordinance, specifically handling property known or believed to represent proceeds of indictable offences, and under the Securities and Futures Ordinance (SFO), involving market manipulation and other forms of market misconduct.
Hong Kong SFC & ICAC Conduct Joint Operation on Syndicate for Market Manipulation of Hong Kong-Listed Company & Corrupt Practices, Syndicate Conspired to Claim Hong Kong-Listed Company to Form $2.5 Million Joint Venture with China Mainland Company & Entered into Share Subscription Agreement, Arrested Hong Kong-Listed Company ex-Chairman & ex-Executive Director (Also Director of a Broker) for Bribery, ex-Executive Director Had Also Misappropriated $1.1 Million (HKD 9 Million) Shares
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