Market Misconduct Tribunal submits report on QPL International Holdings Limited
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     The Market Misconduct Tribunal (MMT), chaired by the Honourable Mr Justice Lunn sitting with Mr Michael Sze Tsai-ping and Dr Cynthia Lam Kit-lan as members, has submitted its reports to the Financial Secretary on its proceedings in relation to dealings in the listed securities of QPL International Holdings Limited (QPL) in May and June 2003.

     In part I of its report, the tribunal determined that:

(i) Mr Edmund Chau Chin-hung was culpable of market misconduct by false trading, contrary to section 274(1)(b) of the Securities and Futures Ordinance, Cap. 571 in that he intended by his conduct to create a false or misleading appearance in respect of the market for QPL shares traded on the Stock Exchange of Hong Kong Limited (SEHK) and by the same conduct that he was culpable of price rigging, contrary to section 275(1)(b) of the ordinance in that he intended or was reckless as to whether that conduct had the effect of maintaining the price of QPL shares traded on the SEHK;

(ii) Ms Connie Cheung Sau-lin, having assisted or connived with Mr Edmund Chau Chin-hung in the perpetration of that conduct with the knowledge that such conduct constitutes or might constitute market misconduct, was culpable of market misconduct by false trading, contrary to section 274(1)(b) and price rigging, contrary to section 275(1)(b) of the ordinance;

(iii) Cheeroll Limited was culpable of market misconduct by false trading, contrary to section 274(1)(b), and price rigging, contrary to section 275(1)(b) of the ordinance; and

(iv) Sun Hung Kai Investment Services Limited was culpable of market misconduct by false trading, contrary to section 274(1)(b), and price rigging, contrary to section 275(1)(b) of the ordinance.

     In part II of its report, the tribunal made orders against the above-named parties, inter alia, that:

Mr Edmund Chau Chin-hung:

(i) pursuant to section 257(1)(a), that he shall not, without the leave of the Court of First Instance, be or continue to be a director, liquidator or receiver or manager of the property or business, of a listed corporation or any subsidiary company of Sun Hung Kai & Co including Sun Hung Kai Investment Services Limited or in any way, whether directly or indirectly, be concerned or take part in the management of a listed corporation or any subsidiary company of Sun Hung Kai & Co, including Sun Hung Kai Investment Services Limited for 18 months;

(ii) pursuant to section 257(1)(c), that he shall not again perpetrate any conduct which constitutes market misconduct;

(iii) pursuant to section 257(1)(e), that he shall pay the Government $796,076.41;

(iv) pursuant to section 257(1)(f) that he shall pay the Securities and Futures Commission (SFC) $15,753.25; and

(v) pursuant to section 257(1)(g) that the SFC be recommended to take disciplinary action against him.

Ms Connie Cheung Sau-lin :

(i) pursuant to section 257(1)(a), that she shall not without the leave of the Court of First Instance, be or continue to be a director, liquidator or receiver or manager of the property or business, of a listed corporation or any subsidiary company of Sun Hung Kai & Co including Sun Hung Kai Investment Services Limited, whether directly or indirectly, be concerned or take part in the management of a listed company or any subsidiary company of Sun Hung Kai & Co, including Sun Hung Kai Investment Services Limited for six months;

(ii) pursuant to section 257(1)(c), that she shall not again perpetrate any conduct which constitutes market misconduct;

(iii) pursuant to section 257(1)(e), that she shall pay the Government $796,076.41;

(iv) pursuant to section 257(1)(f), that she shall pay the SFC $15,753.25; and

(v) pursuant to section 257(1)(g), that the SFC be recommended to take disciplinary action against her.

Cheeroll Limited, now known as Sun Hung Kai Strategic Capital Limited :

(i) pursuant to section 257(1)(c), that it shall not again perpetrate any conduct which constitutes market misconduct;

(ii) pursuant to section 257(1)(e), that it shall pay the Government $796,076.41; and

(iii) pursuant to section 257(1)(f), that it shall pay the SFC $15,753.25.

Sun Hung Kai Investment Services Limited :

(i) pursuant to section 257(1)(c), that it shall not again perpetrate any conduct which constitutes market misconduct;

(ii) pursuant to section 257(1)(e), that it shall pay the Government $796,076.41;

(iii) pursuant to section 257(1)(f) that it shall pay the SFC $15,753.25; and

(iv) pursuant to section 257(1)(g), that the SFC be recommended to take disciplinary action against it.

     The MMT proceedings on the trading of QPL shares involved four specified persons and the receipt of oral testimony from seven witnesses over a total of 22 hearing days.

     The summary of the tribunal's report is at the annex.

Ends/Wednesday, March 18, 2009
Issued at HKT 16:30

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