Hong Kong regulator issues restriction notice to KGI Asia
The SFC has issued a restriction notice to the broker ordering it to freeze client accounts related to a corporate officer’s suspected breach of duties.
Hong Kong’s Securities and Futures Commission (SFC) today announces that it has issued a restriction notice to KGI Asia Limited ordering the company to freeze client accounts related to a corporate officer’s suspected breach of duties.
The notice concerns assets held in several client accounts which are beneficially owned by an individual who is suspected of breaching his duties towards a listed corporation. The restriction notice prohibits KGI, without the SFC’s prior written consent, from disposing of or dealing with, assisting, counselling or procuring another person to dispose of or deal with certain assets in those accounts in any way. KGI is also required to notify the SFC if it receives any of these instructions.
The regulator stresses that it is not investigating KGI, which has cooperated with the SFC’s investigation. The restriction notice does not affect KGI’s operations or its other clients.
The SFC says it will soon launch civil proceedings under section 214 of the Securities and Futures Ordinance (SFO) in the Court of First Instance against the listed corporation’s management team which includes the individual who holds the accounts in question. The regulator will also seek court orders against that individual to pay compensation to the listed corporation concerned.