A SECRET investigation is being carried out under sweeping powers granted to the Securities and Futures Commission (SFC).
In reply to a question by Legislative Councillor Chim Pui-chung, who represents the financial services industry, Michael Cartland, secretary for financial services, revealed yesterday that there was an investigation.
It also came to light that the closed-door investigation could have begun as long ago as last July.
Mr Chim asked Mr Cartland how many firms had been investigated under Section 33 of the SFC Ordinance and how many had been formally prosecuted or convicted.
Mr Cartland said that section 33 did not allow for the investigation of companies but Section 29a of the ordinance, introduced last July, did.
Section 33 deals with suspicious share trading activity.
Section 29a gives sweeping powers to investigate when persons concerned with the affairs of a company may have, in relation to its management, engaged in fraudulent acts, misfeasance or other misconduct towards the shareholders.