On 11 March 2009, the District Court of Hong Kong reached its decision in a landmark trial, convicting five defendants of a total of 12 charges of "insider dealing" under section 291 of the Securities and Futures Ordinance, Cap.571 ("SFO"). This is only the second criminal prosecution of its kind in Hong Kong since the SFO came into force in 2003. The first, less serious, case was tried summarily in the Magistrates Court and the decision is scheduled to be handed down on 27 March 2009.
The present case involved a former vice president at BNP Paribas Peregrine Capital Limited (now known as BNP Paribas Capital (Asia Pacific) Limited) ("BNP"), Mr. Ma Hon Yeung ("Mr. Ma"), his girlfriend, and three of Mr. Ma’s relatives.In 2006, while working at BNP, Mr. Ma was involved in advising on the privatisation of Egana Jewellery & Pearls Limited ("Egana").
The Court found that Mr. Ma had passed his knowledge of the proposed privatisation (which was confidential and price sensitive information) to his girlfriend and relatives, who then traded in Egana’s shares prior to the privatisation being announced on 11 July 2006. The Court also found that the individuals acted on the advice of Mr. Ma and profited from the trade.
Sentencing of all five convicted individuals has been adjourned until 1 April 2009.