Stock Connect trader investigated by regulators seeks judicial review

2-MIN READ2-MIN

(From left to right) Executive Vice President of the Shanghai Stock Exchange, Que Bo; HKEX Chief Executive Charles Li Xiaojia; Chairman of the Securities and Futures Commission, Carlson Tong Ka-shing; Deputy Director of the Liaison Office of the Central People's Government in HKSAR, Qiu Hong; HKEX Chairman Chow Chung-kong, Chief Executive of Hong Kong, Leung Chun-ying, Vice Chairman of the China Securities Regulatory Commission, Fang Xinghai, Secretary for Financial Services and the Treasury, Professor Ceajer Chan Ka-keung; and Chief Executive of the Hong Kong Monetary Authority, Norman Chan Tak-lam; attend the Launch Ceremony of Shenzhen-Hong Kong Stock Connect at Exchange Square in Central. 05DEC16 SCMP/ K. Y. Cheng

Published: 10:30pm, 2 May 2017Updated: 5:45am, 3 May 2017

Tang Hanbo, the first Chinese trader to be penalised by regulators for breaching securities regulations involving Hong Kong stocks, is seeking a judicial review in the city to revoke and invalidate a search conducted on his residence, claiming the gathering of evidence was unlawful.

Tang, a Chinese citizen living in Hong Kong, was slapped with 1.2 billion yuan (US$174 million) in fines and penalties by the China Securities Regulatory Commission for breaching the country’s securities rules in the share dealings of Heng Xin China Holdings and Tian Ge Interactive Holdings during August 2015 and June 2016.

The breaches, in part, involved the Hong Kong-Shanghai Stock Connect programme, which allows Chinese citizens to trade in Hong Kong-listed stocks. Tang had opened up trading accounts on the mainland and with Yue Xiu Securities in Hong Kong.

Officials from Hong Kong and China attend the launch ceremony of Shenzhen-Hong Kong Stock Connect in December 2016, two years after the launch of the Hong Kong-Shanghai Stock Connect. PHOTO: K. Y. Cheng

In Hong Kong, the Securities & Futures Commission had applied for a search warrant at the Eastern Magistracy to seize materials at Tang’s Shatin residence to help investigations that also involved the share dealings of the two companies.

But the warrant did not specify if it was to seize evidence to help with the CSRC’s investigation, argued Tang’s law firm CL Chow & Macksion Chan.