Published On: Tue, Jan 31st, 2012

Futures Trader Tsoi Bun Convicted of Price Rigging After Retrial

The Eastern Magistracy today convicted a futures trader, Mr Tsoi Bun, after a retrial of five charges of manipulating the calculated opening prices (COP) of index futures contracts in the futures market following his acquittal two years ago.

Tsoi was sentenced to six months imprisonment to be suspended for two years; fined $500,000 and ordered to pay the Securities and Futures Commission (SFC)’s investigation costs.

The retrial was ordered by the Court of First Instance following an application by the SFC for a review of the acquittal by the Eastern Magistracy in January 2010.

Tsoi was charged following an investigation by the SFC of manipulating the COP of Hang Seng China Enterprises Index futures contracts and Hang Seng Index futures contracts during the morning Pre-Market Opening Period on five trading days between 14 February 2007 and 25 September 2007.

The SFC alleged that Tsoi made a profit of $949,350 in respect of these manipulative trades.

The SFC is considering seeking a review of the sentence imposed today on Tsoi given the level of fine failed to deprive Tsoi of the unjust profits alleged by the SFC to have been earned through his misconduct.

Upon the SFC’s request, the Court also imposed a cold shoulder order against Tsoi preventing him from dealing either directly or indirectly in futures contracts in both the morning and afternoon Pre-Market Opening Periods without leave of the Court for a period of 12 months.

This is the first time the SFC has criminally prosecuted market manipulation in Hong Kong’s futures market and the second time the SFC has taken action against Tsoi in respect to manipulation of the futures market.

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