SFC statement on Police investigation concerning Next Digital (0282) shares
Our rough translation: "The Police are off piste, out of their depth and we haven't heard from them". This comes a day after the Police conducted a press conference about the arrests without having charged anyone, alleging market manipulation.
SFC statement on Police investigation concerning Next Digital shares
Issue date: 2020-09-11 18:45:45
The Securities and Futures Commission (SFC) is issuing this statement in response to the numerous enquiries it has received following a press conference held by the Narcotics Bureau of the Hong Kong Police (Police) yesterday in relation to its investigation into the trading of the shares of Next Digital Limited (Next Digital).
The Police indicated that it is investigating suspected conspiracy to defraud and money laundering – as well as potential false trading – in the shares of Next Digital. False trading is an offence under the market misconduct provisions of the Securities and Futures Ordinance (SFO). As the securities markets regulator in Hong Kong with a responsibility to investigate and enforce against breaches of the SFO, the SFC considers that it is in the public interest for it to clarify its position in relation to this matter.
Pursuant to a Memorandum of Understanding (MOU) between the Police and the SFC, both parties have committed to collaborate and cooperate to the fullest extent possible to perform their regulatory and enforcement functions effectively in relation to crimes or illicit activities relating to the securities and futures industry in Hong Kong (Note 1).
The MOU contemplates the exchange and use of information, as well as other investigative assistance, where suspected criminality or misconduct falls within the functions of both the Police and the SFC.
When a request is made under the MOU, the SFC will normally respond by engaging its surveillance, supervisory or investigatory powers to obtain relevant information, and will pass this information to the Police, provided that the request concerns potential offences under which both the SFC and the Police have jurisdiction, for example, money laundering.
Investigation into market misconduct offences, such as false trading, often involves complex questions of law and evidence, as well as the need for expert evaluation in relation to securities market functioning, trading methods and investor behaviour. The SFC is ready to respond to any requests made by the Police under the MOU for this type of assistance in relation to any potential offences under the SFO.
As investigations are continuing, the SFC is not in a position to comment any further.
- Please see the SFC’s press release on the signing of the Memorandum of Understanding between the SFC and the Police dated 25 August 2017.
- Please also see the SFC’s press release dated 11 August 2020.
News captured as of:2020-09-11 19:15:28