Skip to main content

Hong Kong says it wants to reopen for business, to resume its place among the world’s financial capitals. It says this while also saying it will, per Beijing, maintain tighter COVID-19 restrictions and focus on reopening its border with the mainland before worrying too much about the international travelers that give it its cache among the monied. And now it’s also saying this:

“US regulators’ scrutiny of block-trading practices has been a hot topic in recent news articles,” [Hong Kong Securities and Futures Commission deputy CEO Julia] Leung said in a speech at a conference held by Asia’s largest financial lobby group Asifma.

“We are looking into how market participants communicate information with potential investors prior to the announcement of a transaction, commonly known as ‘market sounding….’”

Leung also said that the collapse of Archegos had prompted the SFC “to take a fresh look at the surveillance tools we use to detect concentrated positions in the [over-the-counter derivatives] market”.

Hong Kong always knew there was something shady about that Bill Hwang. Of course, it doesn’t have to look quite that far to find some potentially troubling block trades.

Hong Kong-headquartered hedge fund Segantii Capital, run by British businessman and Blackpool FC owner Simon Sadler, is also under scrutiny over block trades.

Hong Kong investigates block and derivatives trading after Archegos collapse [FT]
Hong Kong’s Struggle to Lure Bankers Dims Its Role as a Global Finance Hub [WSJ]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

Related

(Getty Images)

Goldman, Morgan Stanley Didn’t Just (Allegedly) Screw Credit Suisse Over On Archegos Sales

At least one company did not enjoy having its shares dumped, it says in lawsuit form.

Approx. size of the new pad.

World’s Banks Doing Their Part To Snuff Out Democracy In Hong Kong

Not a fan of Beijing’s heavy hand? No wealth management services for you!

moynihan

‘Actually, On Reflection, We’d Rather Not Block Trade With You’

Bank of America, Citibank move to reduce future block-trading fines.

(Getty Images)

It Has Stopped Being A Good Thing To Be Friends With Morgan Stanley’s Block Trading Head

Calls from Pawan Passi have been succeeded by calls from federal prosecutors and Gary Gensler.

By US government [Public domain], via Wikimedia Commons

The Latest Standard Wall Street Practice That Is Apparently Rife With Fraud

Block trading is getting the old Garland-Gensler double-team.

jail

Prosecutors Pretty Sure You Can’t Lose Your Banks $10 Billion Legally

Which is bad news for Bill Hwang and the Archegos crew.