Hong Kong’s Securities and Futures Commission dropped a misconduct lawsuit against Standard Chartered and UBS over their roles in a 2009 IPO. But UBS and several other firms aren't off the hook yet.
finews.asia reported in January this year when the Securities and Futures Commission in Hong Kong, or SFC, first broke the news. The local regulator had accused UBS as well as Standard Chartered and others of market misconduct in the public listing of China Forestry Holdings.
The regulator also sued China Forestry itself, the company’s two co-founders Li Kwok Cheong and Li Han Chun, and KPMG, which was China Forestry’s auditor.
Action Lapsed
The SFC determined its action against «certain parties was probably time-barred», the regulator said after considering its legal position, «The Wall Street Journal» reported. The SFC neither elaborated nor named any of the banks in its emailed statement. UBS and Standard Chartered jointly underwrote the 2009 China Forestry IPO.
However, neither bank is in the clear yet, the newspaper reported: UBS is still being probed over the 2009 IPO of China Metal Recycling as well as that of Tianhe Chemicals Group, a Chinese firm which went public three years ago.
Last week, Hong Kong's securities regulator said it is examining shoddy IPO practices at as many as 15 firms.
IPO Probe Ongoing
China Forestry raised $216 million in the listing, but its shares have been suspended since January 2011, after its auditor said it had found possible accounting irregularities. The company is now in liquidation and has been delisted from the Hong Kong exchange.
The SFC’s own investigation into the 2009 IPO would continue despite the withdrawal of one lawsuit, one person with knowledge of the matter told «Reuters» . This could result in some action against the banks.
