The Court of Final Appeal has handed down an important judgment regarding bribery charges against former TVB general manager and TV presenter, Stephen Chan and his assistant, Tseng Pei-kun. In a case spanning seven years, Chan and Tseng were twice acquitted at first instance but found guilty of bribery by the Court of Appeal in November 2015. Tseng was found by the Court of Appeal to have offered, and Chan to have accepted, an unlawful advantage under section 9 of the Prevention of Bribery Ordinance (POBO), which governs bribery between private sector actors in Hong Kong.
On 17 February 2017, the Hong Kong Court of Final Appeal brought to a close the long-running case of DBS Bank (Hong Kong) Limited v Sit Pan Jit (FAMV 45/2016).
The dispute concerned a claim by DBS Bank (Hong Kong) Limited (DBS) against its former customer, Sit Pan Jit, for failing to meet margin calls in respect of certain investments, and a counterclaim by Mr Sit against DBS for mis-selling such investments based on misrepresentation, breach of duties in contract and/or tort (common law and statutory) and breach of fiduciary duties.
Last Friday, the former chief executive of Hong Kong, Donald Tsang Yam-kuen, was convicted by a criminal court on a charge of misconduct in public office. This is a first-of-its-kind conviction and again signals the willingness of Hong Kong's Department of Justice and the Independent Commission Against Corruption to investigate and prosecute even the most senior government officials. Mr Tsang was sentenced earlier today and received a custodial sentence of 20 months in prison.
The Securities and Futures Commission (SFC) in Hong Kong has recently sought disqualification orders against listed company directors in a number of court actions commenced in the past few months. The proceedings against the directors have been brought under section 214 of the Securities and Futures Ordinance. If successful, the court has the power to disqualify the relevant directors from being directors or from being involved, directly or indirectly, in the management of any corporation for up to 15 years. The SFC is also seeking compensation orders from certain directors in some cases.
Hong Kong SFC urges intermediaries to review compliance with AML/CFT requirements following identification of deficiencies
On 26 January 2017, the Securities and Futures Commission (SFC) issued a circular (with Appendix 1, Appendix 2 and Appendix 3) highlighting its concerns regarding compliance by licensed corporations (LCs) and associated entities (AEs) with anti-money laundering and counter financing of terrorism (AML/CFT) requirements. The circular sets out the deficiencies and inadequacies in intermediaries' AML/CFT policies, procedures and controls (AML/CFT systems) identified by the SFC in the course of its routine and thematic inspections conducted in 2016. To assist intermediaries, the SFC has further set out some examples of good practices which LCs and AEs are encouraged to consider adopting.
On February 3, 2017, the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) added a number individuals and entities to its Specially Designated Nationals ("SDNs") list of blocked persons. OFAC stated that such actions were taken in response to Iran's development of a ballistic missile program.
Hong Kong regulators issue guidance to sponsors, underwriters and placing agents on GEM initial public offerings
New listings on the Growth Enterprise Market (GEM) in Hong Kong have been repeatedly in the headlines in recent years for dramatic share price increases on their listing debuts and high share price volatility in post-listing periods. This has led to regulatory concerns. The Securities and Futures Commission (SFC) has been working with the Stock Exchange to review listing policy, including a holistic review of GEM, interlinked with a review of backdoor listings, listed shells and companies with prolonged suspensions.
Welcome to the January 2017 edition of our corporate crime update – our round up of developments in relation to corruption, money laundering, fraud, sanctions and related matters. Our update now covers a number of jurisdictions. For the full update on each jurisdiction, please click on the name of the jurisdiction below. Below we provide a brief overview of what is covered in each update.
Indonesia’s Criminal Procedure Code (“KUHAP”) was last revised in 1981. Many are of the view that it has not kept up with legal developments since then and that it is in need of substantial amendments. In the past month, there have been two major developments, namely the promulgation of a new Supreme Court Regulation relating to corporate prosecutions and a significant Constitutional Court decision relating to the supervision of criminal investigations.
While powers to investigate and prosecute corporations have been significantly expanded, investigators will also be subject to closer supervision.
On January 27, 2017, the Trump administration issued a new Executive Order that temporarily suspends from entry to the US persons who are nationals of Iraq, Syria, Sudan, Iran, Somalia, Libya, and Yemen, with very limited exceptions. It also temporarily suspends for the next 120 days the Refugee Admissions Program and restricts the visa interview waiver program.