''It often takes quite a long time to complete the inquiry on those sorts of things. Whether they make a positive finding by the end of the day and decide to do something is too early to say.'' The SFC declined to comment on Mr Cartland's statement.

Yesterday Government Secretariat financial principal assistant secretary Raymond Li said: ''Yes, there has been discussion on this matter. The SFC has asked questions.'' Deputy secretary for financial services Tam Wing-pong said yesterday: ''It is the regulator's duty to study any suspicious share movement. This is an on-going routine matter.'' The official announcement that Guoco had out-bid other candidates in the competition for OTB did not come out until July 23.

But the share price jumped suddenly on July 12 from its close of $20.10 the previous day to $20.80 by day's end, hitting a high of $21.40. Its warrant also shot up from $5.35 to $6.80 on that day.

Guoco's shares, according to Bloomberg, traded at an average of $18.81 from the beginning of the year until the unexplained jump.

The average share price of Guoco in the 30 trading days before July 23 was $20.07. The average price over the 30 days until yesterday was $21.43.

The share price jump prompted Guoco and the Government to announce jointly on July 23 that they were discussing the sale of OTB.

''Those were matters of concern that led the stock exchange authority to ask Guoco to explain this sudden move in their share price. We were then involved in the discussion,'' Mr Cartland said.

''We talked with Guoco at that stage and agreed that we would come out and confirm the situation that we'd been in a confidential discussion,'' he said.

The announcement said only that Guoco was one of the parties in discussions.

The Government's intention to sell OTB was made public late last year. Guoco's interest in bidding was always known. So the market was trading on a fresh development.

The share price after July 12 stood firm at $20.50 to $20.90, before the formal confirmation from the Government that Guoco had won the bid.

Market rumours were rife around that time that Guoco had offered the highest bid and had been successful.

The market even suggested that companies with close relations with Guoco had already traded on the news in anticipation of a share jump after the formal announcement.

Mr Cartland's words yesterday were: ''I believe the SFC and the stock exchange whose job it is to look at those things [irregular trading activity] will be looking at it. It always takes some time for them to do that.

''Yes, it was a matter of concern that led the stock exchange authorities to ask Guoco to explain the sudden movement in their shares.

''We were then involved in the discussion of that. We talked to Guoco at that stage and agreed that we would also come out and confirm the situation [that Guoco was in talks to acquire OTB].

''This created a level playing field as far as information was concerned. If you look at the share price it then levelled out and went down.

''I am sure that the SFC will be conducting an inquiry about all this. It is within their jurisdiction to look at it.

''I know that they have taken note of the case. I believe that they are looking at it but I have no report of what the outcome is.''