The number of proposed disciplinary actions taken by the regulator rose to 25 during the six months to 30 September 2016, up from 15 a year ago.
The regulator started 251 investigations during 1H16, down from 255 during the same period last year. The number of completed cases rose to 294 from 238, year-on-year.
Four corporations and eight licensed representatives were disciplined during the three months to 30 September, resulting in total fines of $25.8m (£20.4m, €24.1m).
The number of complaints against intermediaries and market activities, however, fell by 9.5% to 1,040, down from 1,149 in 1H15.
Licence applications
The total number of licenced corporations, licenced individuals, and registered institutions rose by 3.2% to a record high of 42,571.
However, applications to conduct new regulated activity decreased 4.8% to 11,625, while the number of people and organisations applying for SFC licences dropped 3% to 4,094.
Assets and jurisdictions
Assets under management in Hong Kong reached $1.35trn as of 30 September, up 9% from the same six-month period in 2015.
Luxembourg-domiciled unit trusts and mutual funds accounted for the lion’s share on offer at nearly 66%. However, the net asset value (NAV) of Luxembourg funds only increased by 4% compared with last year.
The strongest year-on-year growth for a single jurisdiction was the United Kingdom. NAV for the three months to 30 September was $93.4bn, up 22.4% from last year.
The second strongest growth was from Hong Kong domiciled funds, up 13.7% to $126bn, year-on-year.
Bermuda and the Cayman Islands were the only jurisdictions to report decreases in NAV, of 22% and 13%, respectively.
Equities made up the biggest proportion of the authorised unit trusts and mutual funds on offer with 46%, followed by bonds at 34%.
Enforcement approach
The SFC has also relaunched its Enforcement Reporter publication on a biannual basis to provide updates on the regulator’s key enforcement priorities.
“Listed companies-related fraud and misfeasance have wiped out billions in market capitalisation and caused significant damage to the integrity and reputation of our markets,” said Thomas Atkinson, the SFC’s executive director of enforcement. “The SFC has formed a specialised team to focus on these cases.”
In addition, the SFC will adopt a holistic approach to identify systemic weaknesses at the corporate group level and focus its enforcement actions on companies and corporate groups with multiple failings.
“The SFC values timely, open and transparent disclosure of misconduct. To encourage more cooperation, the SFC may notify parties under investigation of its intention to take enforcement action,” Atkinson added.
“In response, the parties and their legal advisers would have an opportunity to make submissions which may be on the record.”
