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Writer's pictureSFC

SFC obtains court order to freeze assets of suspected insider dealers of I.T Limited shares

The Court of First Instance has granted an interim injunction order against Ms Tsang Ching Yi and Mr Barry Kwok Sze Lok in legal proceedings commenced by the Securities and Futures Commission (SFC), prohibiting them from removing assets, including selling of their real properties, up to the value of $8,246,496 from Hong Kong in relation to an ongoing investigation into suspected insider dealing in the shares of I.T Limited (I.T) (Notes 1 & 2).

The SFC alleged that Tsang shared with her friend Kwok inside information relating to the privatisation of I.T that she acquired through her employment as a manager at an investment bank. Both of them then went on to deal in I.T shares using such inside information; they bought 2.844 million I.T shares through Kwok’s securities accounts in October and November 2020. After the proposed privatisation was announced by I.T in December 2020, they immediately sold the shares, yielding profits of $4,123,248.

Tsang and Kwok have both left Hong Kong and have taken steps to remove their assets from Hong Kong. In the light of the clear risk of dissipation, the SFC considers that it is necessary to obtain a freezing order to prevent Tsang and/or Kwok from further transferring their assets, including the suspected illicit gains of their trading, out of Hong Kong and to ensure any future orders made by the Court and/or the Market Misconduct Tribunal can be fulfilled if they are found liable for insider dealing.

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Notes:

  1. The proceedings were commenced under section 213 of the Securities and Futures Ordinance.

  2. The shares of I.T was listed on the Stock Exchange of Hong Kong Limited (SEHK) on 4 March 2005. On 6 December 2020, I.T announced its proposed privatisation through a scheme of arrangement. Prior to this announcement, the trading of I.T shares were suspended on 30 November 2020 at the closing share price of $1.94. After the trading of I.T shares resumed on 7 December 2020, the share price of I.T rose by 44.8% to close at $2.81. The scheme of arrangement became effective on 28 April 2021 and the listing of I.T shares was withdrawn from the SEHK on 30 April 2021.

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