This week SFC announced that the Court of Appeal has allowed SFC's appeal against a decision of the Securities and Futures Appeals Tribunal (SFAT) and decided that criminal procedures are not applicable to SFC disciplinary proceedings.
On 19 March 2010, the SFAT altered SFC's decision to revoke the licence of Asser Li Kwok Keung and ban him for 10 years to a suspension for 18 months for lying to SFC and breaching his undertaking to co-operate. In addition, in its determination, the SFAT equated the obligations of the SFC in disciplinary proceedings with that of a prosecutor in criminal proceedings.
SFC appealed to the Court of Appeal against both the penalty imposed by the SFAT and its analogy drawn between SFC's disciplinary process and criminal procedures.
The Court of Appeal, comprising Madam Justice Kwan JA, Mr Justice Stone and Mr Justice Bharwaney, unanimously allowed the SFC’s appeal and increased the penalty for Li from a suspension of licence for 18 months to a prohibition order for three years.
Jack's comment: Many market practitioners believe that SFC's disciplinary process is a kind of "private punishment" and should be subject to the rigidity of criminal procedures. Unfortunately, the Hong Kong court usually supports SFC, especially when SFC can use taxpayers' monies to extend its power.
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