The East Magistrates’ Court today sentenced Ms Christine Yeung Tak Sum, a retail trader, to 18 months in prison following her conviction for securities fraud involving illegal short selling in a prosecution brought by the Securities and Futures Commission (SFC).
This is the first time a person has been convicted of the offense of using a fraudulent or deceptive scheme with intent to defraud in trading securities under section 300 of the Securities and Futures Ordinance in illegal short selling.
In sentencing, Judge Mr Jeffrey Sze Cho Yiu noted the serious nature of the offence, the premeditated commission of the offense and a significant amount of ill-gotten gains. The judge concluded that taking into account these factors and the importance of maintaining Hong Kong’s status as an international financial centre, a strong deterrent message should be sent to the public by imposing an immediate custodial sentence on the offender.
The SFC’s Executive Director of Enforcement, Mr Christopher Wilson, said:
“This case arose out of a complex investigation in which we discovered suspected securities fraud through illegal short selling immediately prior to the stock price collapse.
The outcome of this case sends a clear and strong warning to market participants that the SFC has zero tolerance for market misconduct. We will redouble our efforts to root out market misconduct in order to safeguard market integrity and maintain a level playing field for Hong Kong.”