After the listing of penny stock Zhengli Holdings in March 2016, the stock price soared 8 times, and about 5 and a half months later, it fell by 90% in a single day, and 1 man and 2 women were charged by the Hong Kong Securities and Futures Commission with conspiracy to conduct false transactions.
After the trial, the jury convicted the three of them, and Deputy Judge Yau Tak-hong sentenced the three to 4 years and 4 months to 6 years and 8 months in prison in the High Court on the 22nd.
Hong Kong Securities and Futures Commission: Committed to maintaining the integrity and soundness of the market
Christopher Wilson, Executive Director of Enforcement of the SFC, welcomed the court's decision outside the court, saying that this case was the first market manipulation case convicted by a jury of the High Court and the longest sentence of its kind, marking an important milestone in the SFC's fight against market manipulation and sending a clear message to the public that the SFC will not tolerate any type of market manipulation and will continue to take enforcement actions to protect investors and safeguard the integrity of the Hong Kong market.
The three defendants, Angela Sit, Lam Wing-ki and Tam Cheuk-hang, were charged with one count of conspiracy to carry out false dealings. The charge alleges that between March 29, 2016 and September 7, 2016, together with Sun Man, Ho Ming-hin and other unidentified persons, conspired with Sun Man, Ho Ming-hin and other unidentified persons to issue or cause to be placed orders in relation to the securities traded in the securities market operated by The Stock Exchange of Hong Kong Limited, with intent to cause the stock price to have, or are likely to have, a false or misleading appearance of active trading, causing the share price to soar by 8 times, and then plummeting by 90% in a single day about five and a half months later.
Judge: Deterrent sentence shall be imposed
In sentencing, the officer pointed out that the maximum penalty for this offence was 10 years' imprisonment and a fine of $10 million, citing cases that market manipulation was a serious offence that would jeopardize the safety of the market, and would not only bring benefits to the offenders, but also cause huge losses to the public, and a deterrent sentence was warranted.
Yau Guan pointed out that this case involved large-scale false transactions and complex conspiracy schemes, and involved elements of international cross-border crimes, and although the three defendants in this case were not masterminds, they also put in a lot of effort in the criminal plan, and the mastermind and senior management of the scheme have escaped, and there is a high chance that they cannot be recovered, and the case has damaged the reputation and image of Hong Kong as an international financial centre.
Mr Ngai Hung-fu, Executive Director of the SFC's Enforcement Department, welcomed the ruling as an important milestone in the SFC's fight against market manipulation. TV screenshots
Despite the scale of the case, the three defendants were not the masterminds in the case, and the officer did not believe that the maximum sentence of 10 years in prison should be imposed. In the case, the first defendant, Xue Yiqi, directly received instructions from high-level Sun Wen and He Mingxuan, and in consideration of their role and the need to deter the sentencing, the starting point of sentencing was set at 7 years in prison. Tan Zhuoheng collected transaction data in the case, which was subordinate to Sun Wen's subordinates, and also used 7 years as the starting point; Lin Yingqi had the lowest level of involvement in the case, so she used 5 years as the starting point.
3 non-masterminds have their sentences reduced by 4 months at their discretion
In his plea, the defense pointed out that there was a delay in the prosecution of this case, and the Yau Officer believed that in view of the complexity of the investigation of the case, the prosecution's bringing the case to court in 2020 was not a delay, but the case was transferred to the High Court in 2021 to the trial in April 2024, and the defendant was undoubtedly under tremendous pressure during this period, so the Yau Officer exercised his discretion to reduce the sentence by 4 months; In addition, the tour officer took into account the special needs of Lin's son, so his sentence was reduced by an additional 4 months. In the end, Xue and Tan were sentenced to 6 years and 8 months in prison, and Lin was sentenced to 4 years and 4 months.
Editor: Tong Qu
Editor: Jianzong
Proofreader: Zhuo Ling
Executive Producer: Jia Min