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SFC Bans Former Responsible Officer Of Guangdong Securities Limited For Nine Months Over Internal Control Failures

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SFC Bans Former Responsible Officer Of Guangdong Securities Limited For Nine Months Over Internal Control Failures

The Securities and Futures Commission (SFC) has prohibited Mr Huang Qiang, former managing director and responsible officer of Guangdong Securities Limited (GSL), from re-entering the industry for nine months from 10 March 2017 to 9 December 2017 (Notes 1 & 2).

The disciplinary action follows the SFC’s sanction against GSL over its breach of the anti-money laundering guidelines when handling third party payments between February 2011 and March 2013 (Relevant Period) (Note 3).

As the managing director and a responsible officer of GSL during the Relevant Period, Huang was responsible for overseeing all of GSL’s operations, including monitoring risk and compliance issues.  GSL’s failures in relation to the third party payments occurred under Huang’s consent or connivance and were attributable to neglect on his part.  Specifically, Huang had failed to:

  • ensure the maintenance of appropriate standards of conduct and adherence to proper procedures by GSL; and
  • diligently supervise his staff members to conduct business on GSL’s behalf (Note 4).

In deciding the disciplinary sanction, the SFC took into account all relevant circumstances, including Huang’s otherwise clean disciplinary record.

Notes:

  1. Huang was licensed under the Securities and Futures Ordinance to carry on business in Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities. Huang was accredited to GSL/Sinolink Securities (Hong Kong) Company Limited (Sinolink) as a responsible officer between 25 May 2004 and 30 June 2016.  Huang is currently not licensed by the SFC.
  2. GSL was acquired by Sinolink Securities Co., Ltd. in March 2015, and changed its name to Sinolink in November 2015.
  3. Please refer to the SFC’s press release dated 6 March 2017.
  4. General Principle 9 of the Code of Conduct for Persons Licensed by or Registered with the SFC (Code of Conduct) requires the senior management of a licensed person to bear primary responsibility for ensuring the maintenance of appropriate standards of conduct and adherence to proper procedures by the firm.  Paragraph 4.2 of the Code of Conduct provides that a licensed person should ensure that it has adequate resources to supervise diligently persons employed or appointed by it to conduct business on its behalf.
  5. Licensed persons are reminded to refer to the “Circular to Licensed Corporations and Associated Entities – Anti-Money Laundering / Counter Financing of Terrorism (AML/CFT) Compliance with AML/CFT Requirements” issued by the SFC on 26 January 2017 which sets out key areas of concern identified by the SFC in its review of some licensed corporations’ AML/CFT systems.

Source: SFC 

By Pathay Singh on 03/16/17