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SFC commences MMT proceedings against Deng Yi Feng’s former chairman and others over suspected manipulation of Smartac International Holdings Limited shares

Issue date: 2024-11-12 17:10:00

The Securities and Futures Commission (SFC) has commenced proceedings in the Market Misconduct Tribunal (MMT) against Mr Sui Guangyi, former chairman and non-executive director of Ding Yi Feng Holdings Group International Limited (Ding Yi Feng), two corporate entities and 28 other suspects for alleged manipulation of the shares of Smartac International Holdings Limited (Smartac) (Notes 1 and 2).

The SFC alleges that between 31 October 2018 and 11 March 2019, Sui and the other 30 suspects conducted manipulative trading in Smartac shares to push up the price and turnover, which resulted in creating a false or misleading appearance of active trading in and the price of Smartac shares. Matched trades between the suspects’ securities accounts constituted a notable portion of the trading volume of Smartac shares during the material period (Note 3).

The substantial increase in Smartac’s share price also significantly contributed to an investment gain by Ding Yi Feng as Smartac shares accounted for 21.68% of its gross assets as of 31 December 2018.

The SFC had issued restriction notices to freeze securities accounts linked to the suspected market manipulation of Smartac shares. The restriction notices remain in force (Note 4).

The SFC appreciates the assistance provided by the China Securities Regulatory Commission during the investigation.

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Notes:

1. The listing of the shares of Smartac (formerly known as Smartac Group China Holdings Limited) was cancelled on 20 February 2023 as it failed to fulfil the resumption guidance issued by The Stock Exchange of Hong Kong Limited (SEHK).
2. Ding Yi Feng (formerly known as China Ding Yi Feng Holdings Limited) is listed on the Main Board of SEHK. Separate proceedings have been commenced in the Court of First Instance and in the MMT in relation to suspected market manipulation in Ding Yi Feng shares. Please see the SFC’s press releases dated 26 February 2024 and 27 March 2024.
3. Matched trades refer to trades conducted at or nearly at the same time, and with similar or identical quantity and prices of shares.
4. Please see the SFC’s press release dated 25 June 2019.

Source: SFC