WELCOME TO
SFC
INVESTIGATION & PROSECUTION
DEFENDING FINANCIAL INTEGRITY
We have market leading expertise representing clients in SFC investigations, prosecutions and other enforcement action.
We routinely advise clients who are the persons of interest in SFC actions, including SFC licensed corporations and registered institution, licensed representatives and relevant individuals employed by registered institutions, responsible officers (“ROs”) and other executive officers (“EOs”) and managers-in charge (“MICs”) who are themselves not licensed by the SFC.
We have acted for a wide range of clients, including hedge fund managers, private equity sponsors, managers of units trusts and mutual funds, brokerage firms, wealth managers, independent financial advisers, banks and corporate finance sponsors and advisers.
Leveraging more than twenty years of experience serving clients in the financial sector, our firm has carved out a formidable standing as the preferred organisation for SFC licensed and registered firms and their employees and other representatives in the face of regulatory allegations or suspicions of wrongdoing as well as unlicensed businesses alleged to have breached licensing, investment product authorization or other requirements under the Securities and Futures Ordinance ("SFO").
GETTING THE DEAL DONE
Sophistication
Contact UsFacing an SFC investigation or prosecution demands a sophisticated response. We bring a depth of experience in dealing with the SFC, deep experience in practices and customs in the markets regulated by the SFC and a well honed understanding of the technical complexities of the laws and regulations administered by the SFC.
Scope of
Work
Contact Us We are with you at every stage, representing clients who are under threat of an SFC investigation, those who have been identified as “a person under investigation” or “a person assisting investigation” in an SFC investigation notice, or those who have received a notice of proposed disciplinary action or a summons.
We advise clients on how to handle an SFC investigation, helping you understand your rights, the SFC investigation process, as well as assisting you in preparing for an SFC interview and responding to an SFC investigation notice, including a notice to produce documents and answer written questions, helping you to devising strategies to pre-empt or mitigate risks. We attend SFC interviews with clients.
We offer insights into current SFC enforcement trends and mitigate risks of disciplinary actions such as SFC prosecution with an in-depth understanding to ensure the best possible defence against any regulatory challenges.
We help you to understand the regulatory concerns underlying specific SFC enquiries or requests for information and to prepare responses to pre-empt or mitigate any risk of SFC prosecution or the institution of MMT proceedings.
Innovative
Defensive Strategies
Contact Us Our reputation is built on a strong track record and a penchant for devising innovative strategies to address even the most challenging allegations of wrongdoing. Leveraging our knowledge of the commercial context and regulatory framework, we identify crucial evidence and lines of enquiry that can create a strong defence.
OUR SERVICES
We routinely defend clients against a broad spectrum of alleged or suspected breaches.
By working closely with clients (including compliance officers and in-house counsel) to identify potential regulatory compliance breaches, including non-compliance with the Securities and Futures Ordinance (“SFO”) and subsidiary legislation or the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (“AMLO”), the SFC’s codes, guidelines and circulars, including the Code of Conduct for Persons Licensed by or Registered with the SFC (“SFC Code of Conduct”), the Fund Manager Code of Conduct (“FMCC”), the Corporate Finance Adviser Code of Conduct (“CFA Code”), the Management, Supervision and Internal Control Guidelines (“Internal Control Guidelines”) and the Guideline on Anti-money Laundering and Counter-Financing of Terrorism (For Licensed Corporations) (“AML Guideline”).
Our experience covers a broad spectrum of issues, including alleged or suspected breaches of:
Market
Misconduct and
Anti-Fraud
Details Market misconduct under sections 270, 274 to 278 and 291, 295 to 299 of the SFO; including insider dealing, false trading, price rigging, disclosure of information about prohibited transactions, disclosure of false or misleading information inducing transactions and stock market manipulation
Anti-fraud provisions under section 300 of the SFO which criminalises the act of employing fraudulent or deceptive devices or engaging in fraudulent or deceptive practices in transactions involving securities, futures contracts or leveraged foreign exchange trading.
Disclosure Of
Information
Contact Us The statutory duty to disclose inside information
Disclosure of interests under Part XV of the SFO, whether director disclosures or substantial shareholder disclosures
Short position reporting requirements and documentary assurance requirements
Other
Requirements
Contact Us Licensing requirements regulated activities
Authorization requirements for investment offers
Naked short selling prohibition
SFC Code of Conduct
FREQUENTLY ASKED QUESTIONS
To find out more about how we can assist during an SFC investigation, we set out below a list of common enquiries we receive from clients and our approach to addressing these enquiries as follows.
Q1: Do I need to comply with an SFC investigation notice? Do I have to answer the SFC’s questions?
SFC investigation notices are issued by the SFC under section 183 or section 179 of the SFO. These sections give SFC investigators certain powers. A notice issued under s. 183 may, for example, require you to attend an SFC interview and answer questions, to produce documents and answer written questions or to provide all reasonable assistance to SFC investigators.
We have extensive experience advising clients on the scope of the SFC’s investigation powers. We can advise you on whether the SFC’s requests are within their jurisdiction, how to manage the timeline for an SFC investigation and how to manage the flow of information to the SFC. We can help you identify whether there is any risk that your answers to the SFC’s questions may incriminate you and how to exercise you privilege against self-incrimination.
Q2: Whom can I tell about an SFC investigation? What are the statutory secrecy obligations under the SFO? What is section 378 of the SFO?
Each investigation notice is subject to statutory secrecy obligations under the section 378 of the SFO. This section prohibits you from disclosing to anyone anything about the investigation. However, you may consult a lawyer about the investigation without breaching these secrecy obligations.
In cases where your firm is under investigation, we can advise on how to handle the disclosure of information between members of the firm to comply with statutory secrecy requirements and how to protect information and communications with affiliates and staff from being disclosed, such as by maintaining legal professional privilege and common interest privilege.
In cases where you are personally under investigation, such as when you have received a section 183 notice under a section 182 investigation, we can advise on the persons to whom you can disclose information about the investigation and on what information you can disclose.
Q3: Can I claim directors and officers liability insurance (“D&O Insurance”) for an SFC investigation? What can I tell my insurer about the investigation?
We have extensive experience dealing with indemnity coverage issues in the context of an SFC investigation. We can assist with understanding whether you may be entitled to indemnity insurance, whether under a D&O Insurance policy or a professional indemnity insurance (also known as professional liability insurance or professional services insurance) policy. We can assist with taking steps necessary to claim entitlement under applicable insurance coverage. We can advise you on complying with statutory secrecy obligations in making a claim for insurance coverage and negotiate terms of coverage with the insurer.
Learn more about SFC Investigations & Prosecution in our FAQ page
FAQOUR EXPERIENCE
WE KEEP YOU INFORMED
With deep expertise in defending clients in SFC investigations and prosecutions, our legal team can help with crafting a sophisticated response, advise on how to handle an investigation and providing innovative defence strategies.
Contact us if you need assistance.