The Market Misconduct Tribunal (MMT) has fined Magic Holdings International Limited and five of its directors a total of $4 million after they were found to be culpable of late disclosure of inside information on L’Oréal S.A.’s proposed acquisition of Magic in 2013. The five directors were also disqualified from being a director or being involved in the management of a listed corporation or any other specified corporation, for eight to 24 months. The MMT considered that Magic’s breach of the disclosure requirement was all the more serious because it had not taken all reasonable measures to monitor the confidentiality of the proposed acquisition and it had not disclosed it to the public as soon as reasonably practicable after becoming aware that the confidentiality of the proposed acquisition had not been preserved.

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[Mainland China] Ant Group publishes ‘responsible finance rules’ to protect consumers amid heightened scrutiny from Chinese regulators

SCMP, 12 Mar 2021

Ant Group has published a set of responsible finance rules for its sprawling business, as the fintech giant heeds regulators’ call to enforce consumer protection and stave off systemic risks amid tightened scrutiny. The rules covering its businesses on wealth management, insurance, consumer credit, loans for small-and-micro-operators as well as Zhima Credit.

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[Hong Kong] No launch date in sight for wealth management connect as it depends on resumption of cross-border travel, HKMA chief says

SCMP, 15 Mar 2021

The launch of the wealth management connect will have to wait until cross-border travel restrictions are relaxed, but the Hong Kong Monetary Authority is working with mainland authorities to get it off the ground as quickly as possible, according to Eddie Yue Wai-man, chief executive of HKMA. The wealth management connect scheme was announced by Beijing in June but no launch date has been fixed. Yue said that the HKMA was working with the mainland authorities to simplify the process, which would require just one cross-border travel to open a bank account. Usually opening an account requires a lot of documents and the process sometimes requires multiple visits to the bank.

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[Hong Kong] SFC reprimands and fines Sino-Rich Securities & Futures Limited $7.2 million for breaches of anti-money laundering regulatory requirements

SFC Enforcement News, 15 Mar 2021

The SFC has reprimanded and fined Sino-Rich Securities & Futures Limited $7.2 million for failures in complying with anti-money laundering and counter-terrorist financing regulatory requirements when handling cash deposits and third party fund transfers. Sino-Rich’s staff were required to fill in the relevant third party transfer forms, but the SFC’s investigation found that important information such as the client’s relationship with the third party, the reason for the transfer and/or the client’s signature was not provided in around 40% of the forms. The SFC also found that a substantial number of cash deposits and third party transfers processed or approved by Sino-Rich raised a number of red flags that warranted further inquiries or report to the JFIU. The SFC is of the view that Sino-Rich’s conduct was in breach of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, the Guideline on Anti-Money Laundering and Counter-Terrorist Financing (April 2015 – February 2018 edition), the Code of Conduct and the Internal Control Guidelines.

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[Hong Kong] SFC issues restriction notices to 15 brokers to freeze client accounts linked to suspected social media ramp-and-dump scam

SFC Enforcement News, 15 Mar 2021

The SFC has issued restriction notices to 15 brokers, prohibiting them from dealing with or processing certain assets held in 32 trading accounts, which are related to a suspected social media ramp-and-dump scam involving the manipulation of the market in the shares of a company listed on The Stock Exchange of Hong Kong Limited between November 2019 and November 2020. The brokerages include: Canfield Securities Company Limited, China Galaxy International Securities (Hong Kong) Co., Limited, Sun Hung Kai Investment Services Limited and Sun International Securities Limited.

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[Singapore] Court convicts individual for false trading and deception

MAS News, 15 Mar 2021

Mr Wong Leon Keat was sentenced on 12 March 2021 to a total of eight weeks’ imprisonment and a fine of $30,000 for false trading and deceiving a brokerage firm while trading in the shares of Gaylin Holdings Limited. His conviction was the result of a joint investigation conducted by the Monetary Authority of Singapore and the Commercial Affairs Department of the Singapore Police Force, following a referral by the Singapore Exchange Securities Trading Limited (SGX-ST) to the MAS. He faced 17 charges in relation to violations of section 197(1)(b) of the Securities and Futures Act (SFA) for creating misleading appearances with respect to the price of Gaylin shares on 17 occasions from 11 November 2015 to 25 October 2016, and a charge under section 201(b) of the SFA for deceiving UOB Kay Hian Private Limited by not disclosing his 50 percent beneficial interest in Gaylin shares bought using a UOBKH trading account belonging to another individual.

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[Singapore] Insurance (Lloyd's Asia Scheme) Regulations

MAS Regulation, 15 Mar 2021

The MAS revised the Forms and Annexes and Notes to the Forms Used for the Purposes of the Insurance (Lloyd's Asia Scheme) Regulations. The Regulation set out requirements for carrying on insurance business under the Lloyd's Asia Scheme, a foreign insurer scheme established under the Insurance Act (Cap. 142).

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[Singapore] Notice 811A Credit Files, Grading and Provisioning - COVID-19

MAS News, 15 Mar 2021

This notice sets out the credit grading treatment, for credit facilities granted support measures by finance companies in response to the COVID-19 outbreak, for the period beginning on 1 January 2021 and ending on 31 December 2021. It applies to all finance companies in Singapore.

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[Singapore] Consultation Paper on Proposed Exemption Framework for Cross-Border Business Arrangements of Capital Markets Intermediaries Involving Foreign Offices

MAS News, 15 Mar 2021

The MAS issued a consultation paper to seeks views on (i) MAS’ proposal to exempt foreign head offices or branches of financial institutions in Singapore from the applicable business conduct and representative notification requirements when they serve Singapore customers; and (ii) proposed notification and annual reporting forms, as well as the draft regulations and notices, for both the proposed Branch Framework and notified FRC framework.

Full text: click here; Consultation: click here