ASIC Charges GAIN Capital Employee for Dishonestly Using his Position

The charges relate to orders placed by Shun Yuen Ken Li with the intention of gaining an advantage for clients.

The Australian Securities and Investments Commission (ASIC) has published a statement announcing that following an investigation by the regulator, New South Wales resident Shun Yuen Ken Li, has pleaded guilty in a local court on two charges of dishonestly using his position as an employee.

This latest case follows ASIC’s recent investigation into an individual’s wrong-doings in which the watchdog instigated proceedings against Sydney-based resident Fei Yu for insider trading, who was was fined $10,000, as reported by Finance Magnates.

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GAIN Capital Employee

This time around, Li has been accused of using his position as an employee of GAIN Capital Australia Pty Ltd in contravention of the Corporations Act 2001. The charges relate to orders placed by Li to gain an advantage for two clients.

GAIN Capital offered clients the opportunity to trade share price index (SPI) contracts for difference (CFDs) at the ‘market-on-open’ price – a price corresponding with the price at which SPI matched during the opening auction at 9:50 am.

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ASIC has alleged that between 9 April 2015 and 19 June 2015, Li used his position as an employee of GAIN Capital to manually enter 13 profitable market on open orders in SPI CFDs on the account of another person, with the intention of gaining a financial advantage for that person.

It was further alleged that between 26 May 2015 and 10 July 2015, Li once again used his position to manually enter 38 profitable market on open orders in SPI CFDs on the account of another person, with the intention of gaining a financial advantage for that person.

A pre-sentence report has been ordered and the case has been adjourned to February 2017 for sentencing. Each of the charges falling under the Corporations Act 2001 carry a maximum penalty of $340,000 or/and imprisonment for 5 years.

According to a GAIN spokesperson,“GAIN Capital is committed to operating with the highest standards of integrity. We have robust processes in place that help protect our business. Once our processes picked up the suspicious behavior in the early stages, we terminated the employee and reported the incident to the regulator. We also cooperated fully in ASIC’s investigation into this matter.”

 

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