SFC Imposes Fines of $479 Million During 2019-20 Year

In the regulator’s annual report, the SFC highlighted that it identified 1,489 incidents of breaches.

The Securities and Futures Commission (SFC) announced this Wednesday that it has published its Annual Report 2019-20, in which the regulator has provided a breakdown of market events and highlights as well as set out its priorities for the year ahead.

The 2019-20 year spans across the 12 months from the 1st of April 2019 to the 31st of March 2020. During this time, the number of licensees and registrants increased to 47,167. From this, the number of licensed corporations rose to 3,109.

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Overall, the Hong Kong regulator conducted 317 risk-based on-site inspections of intermediaries during the 12 month period and identified 1,489 incidents of breaches of its rules.

Across the year, the SFC made 8,767 requests for trading and account records from intermediaries as a result of market surveillance and the watchdog disciplined 20 firms and 24 individuals. For intermediary misconduct, the authority imposed fines totalling $479 million.

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SFC increases market supervision amid COVID-19

The report also takes a look at the regulator’s efforts to promote regulatory compliance during the increased volatility and challenging conditions brought on by the coronavirus pandemic.

This event saw the SFC increase its supervisory work and perform regular stress test to monitor the resilience of financial companies. The regulator also conducts special inspections to make sure that firms were complying with their obligations.

Commenting on the report, Tim Lui, the SFC’s Chairman said in the statement: “It is more crucial than ever to deliver world-class regulation which upholds market integrity and supports Hong Kong’s vital role connecting mainland China with the world/ Ensuring financial markets are healthy and sustainable is key to reinforcing Hong Kong’s status as a leading international financial centre.”

The annual report also outlines further highlights throughout the year, including the introduction of a regulatory framework for licensing virtual asset trading platforms, as well as a proposed new type of regulated activity for trustees and custodians of SFC-authorised collective investment schemes.

“Our unwavering commitment to competence, independence, impartiality and public accountability is the foundation of the SFC’s work,” added Ashley Alder, the SFC’s Chief Executive Officer, in the statement. “In the years ahead, concerted global action on the part of regulators and the industry will be essential to address the formidable challenges we face.”

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