The Securities and Futures Commission in Hong Kong has suspended the licence of an account executive of BOCOM International Securities for 18 months, for engaging in manipulative activities.
The severe disciplinary action follows an investigation carried out by the Securities and Futures Commission (SFC) which found that between 5 and 26 November 2010, Ku Yuen Leung created a false or misleading appearance in the market with respect to the shares of Agricultural Bank of China (ABC).
By placing large-sized bid orders for ABC shares Ku was able to drive up the prices of five related call warrants.
Not a Fit and Proper Person
All the bid orders in ABC shares, which were cancelled immediately after Ku sold the related warrants at inflated prices for profit, were apparently not driven by genuine demand but intended to influence the market making decision of their liquidity providers.
As a result Ku made a gross profit of $15,500 from trading the warrants.
In deciding the sanction, the SFC took the view that Ku’s misconduct undermined the integrity of the market and that he is not a fit and proper person to remain licensed.
Ku, who had applied to the Securities and Futures Appeals Tribunal (SFAT) for a review of the SFC’s sanction, was granted leave to withdraw his appeal on 23 August 2016.
