Hong Kong watchdog’s former head, brokers support investigation into fraud allegations at Next Digital
- Appointment of a high-powered inspector came less than a week after Next Digital disclosed it had made a HK$150 million early loan repayment to former chairman Jimmy Lai
- The SFC will conduct its own investigation while the inspector has a wider scope than the market regulator
The former head of Hong Kong’s securities watchdog said he supported the appointment of a special inspector to investigate fraud allegations and corporate governance issues at Next Digital, the publisher of the now-defunct Apple Daily newspaper, as it shows the government is determined to protect the interests of investors and creditors and uphold the market’s credibility.
The appointment will not have any conflict of interest with the Securities and Futures Commission, which on Wednesday indicated it would continue its own inquiries, said Carlson Tong Ka-shing, the SFC chairman from 2012 to 2018.
“The inspector and the SFC have different roles and powers,” Tong told the Post in an exclusive interview by telephone. “The commission can only focus on investigating market-related misconduct while the inspector can look into a wider range of fraud and other corporate governance issues.”
He said that there were many corporate governance and management issues related to Next Digital and that it made sense for an inspector to investigate what was really happening at the company and to give a full report to the shareholders and creditors.
