Two Brokers Jailed for False Trading Scam

The Eastern Magistrates Court sentenced former brokers Mr. Yip Chi Wing and Mr. Tsoi Chiu Kwan to three months in prison each, in a clear attempt to preserve market integrity. The two were convicted of deceitful trading in Forebase International Holdings Limited shares.

The court hearings revealed that Yip and Tsoi, as authorized brokers, played a pivotal role in the coordination of misleading trading patterns that erroneously indicated elevated activity in Forebase shares. For ten months in 2015 and 2016, this deceptive image of trade intensity was maintained.

While delivering the punishment, Magistrate Mr. Jeffrey Sze Cho Yiu stressed the seriousness of the brokers' acts and the need to safeguard the investing public. He said that a swift jail term was necessary due to the seriousness of the acts in order to prevent future misbehavior in the financial markets.

Mr. Christopher Wilson, the Executive Director of Enforcement at the Securities and Futures Commission (SFC), stated, “The court's decision sends a clear message to perpetrators of false trading on the legal consequence for harming market integrity and undermining the trust and confidence of the investing public.”

Mr. Wilson underscored the SFC's strong opposition to market abuses perpetrated by licensed professionals. The Securities and Exchange Commission said, “we will not hesitate to take action against licensed persons who abuse their positions to engage in market misconduct, as their wrongdoings are serious.” He also reminded licensed professionals of the need of maintaining the highest ethical standards and operating in ways that enhance both their customers' best interests and the general integrity of the market.

This action marks a watershed moment in the ongoing struggle against financial market manipulation and to maintain the moral standards that registered brokers must adhere to. In addition to preserving justice, the sentencing strengthens the legal framework designed to protect investors and promote ethical trading practices in financial markets.