Hong Kong securities watchdog investigates 15 IPO sponsors

Oct 11, 2017
Sponsors failed to validate revenues

The securities watchdog in Hong Kong, the Securities and Futures Commission (SFC), is investigating 15 sponsors of initial public offerings following the launch last year of investigations into UBS and Standard Chartered for a 2009 floatation.

The commission’s enforcement head Thomas Atkinson made the statement on Wednesday at a Thomson Reuters regulatory summit. He said some sponsors have failed to validate revenues and other important data on the companies launching IPOs in Hong Kong.

The disclosure that a number of banks are under investigation for substandard work comes as the SFC attempts to tighten its grip on regulation in the city, which has often been accused of falling short in containing fraudulent activities, particularly in relation to dealings by Chinese companies.

Atkinson noted that the SFC was looking into new methods of responding to cross-border crime involving China.

UBS and Standard Chartered both disclosed last year that they were being investigated by the SFC for their roles in sponsoring the 2009 initial public offering of China Forestry Holdings, which was suspended in 2011 and is being liquidated.

Standard Chartered closed its equities division in 2015 but UBS has disclosed that the SFC investigation could lead to a suspension for its IPO sponsoring business.


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