Jail for securities officer who stole client shares

PUBLISHED : Saturday, 15 December, 2012, 12:00am
UPDATED : Saturday, 15 December, 2012, 3:12am

A securities firm employee who manipulated the company's computer system to take shares from clients' accounts and sell them was jailed yesterday for six years and four months.

Siu Leung-to, who was a settlement officer at Taifair Securities and not licensed by the Securities and Futures Commission (SFC) at the time of the offences, pleaded guilty in the Court of First Instance yesterday to five counts of theft and one of money laundering.

The thefts occurred between March and June 2009 and the total in proceeds from the shares sold in the case was more than HK$3 million.

Siu, who joined the firm in 1992, was responsible for settling trades, maintaining records and preparing statements.

Senior prosecutor Vincent Wong Wing-sum told the court Siu would sometimes transfer shares from one client to a dormant account under his control.

"Through those dormant accounts, the accused conducted speculation in the market with stolen shares," Wong said.

In the biggest deal, Siu sold 56,000 shares of Anhui Conch for HK$2.93 million.

After his arrest, he told police he had acquired a password for a higher level of security clearance in the computer system than the one for which he was authorised.

"By a process of experimentation, he found he could use the password to alter the stock holdings of a client and such a change would not be discovered by a routine check," Wong said.

Siu was found out after he did not show up for work in August 2009. A superior at the firm became suspicious and found from an internal check that there was a shortfall in securities with a market value of HK$10 million.

Siu had fled to Shenzhen to avoid arrest, he later told police. He was arrested after returning voluntarily.

The SFC issued a reprimand to Taifair and fined the firm and its responsible officer, Kwok Fai, HK$400,000 and HK$100,000 respectively in August last year.

The SFC said then that "Taifair's settlement supervisor" had misappropriated clients' assets, without identifying the culprit.

Its investigation also revealed a lack of management supervision, compliance functions and other internal deficiencies at the brokerage.