Movie producer Wong Pak Ming convicted of insider dealing in SFC’s prosecution

What Changed

• - The conviction reinforces the SFC’s enforcement position that “counselling or procuring” another person to trade, including a close family member, while in possession of inside information constitutes insider dealing under Part XIII and Part XIV of
• The case highlights that use of personal communication channels (e.g., WhatsApp) to direct trading can be decisive evidence in insider dealing prosecutions, increasing expectations that firms monitor and control off-channel communications for materia
• The conviction confirms that controlling shareholders and chairpersons of Hong Kong–listed companies are expected to treat negotiations for disposal of control stakes, memoranda of understanding (MOUs), and earnest money receipts as potential inside
• The SFC has publicly quantified the estimated illicit profits (over HK$1 million) earned via the relative’s trading, signalling a continued focus on disgorgement and benefit analysis in enforcement and potential follow-on civil actions.
• The case continues the SFC’s trend of using criminal prosecution, rather than solely civil Market Misconduct Tribunal proceedings, for insider dealing involving abuse of senior positions and close personal networks.

Suggested Considerations

• Review and update insider dealing and market misconduct policies to explicitly cover “counselling or procuring” trading by family members, nominees, and other connected persons, in line with Part XIII and Part XIV of the Securities and Futures Ordinance (Cap. 571).
• Update staff and director training materials to include concrete examples of prohibited conduct, including funding relatives’ accounts and giving trading instructions via messaging apps while in possession of inside information about control transactions, MOUs, or earnest money arrangements.
• Strengthen personal account dealing policies to require pre‑clearance and enhanced scrutiny for trades in securities of issuers where the employee, director, or major shareholder is directly or indirectly involved in control stake negotiations or other price‑sensitive corporate events.
• Implement or enhance procedures to identify and log potential inside information events (such as MOUs for stake sales, receipt of earnest money, or other significant transaction milestones) and to trigger trading blackouts for relevant insiders and their close associates.
• Conduct targeted thematic reviews of recent and ongoing corporate finance mandates and control stake transactions handled by the firm to identify any gaps in information barriers, wall‑crossing procedures, or monitoring of insiders’ and their relatives’ trading activities.
• Require directors, senior managers, and key employees who may be insiders to periodically disclose and update lists of close family members and related trading accounts, and integrate this information into surveillance and pre‑trade clearance processes.

Key Dates

Who is Affected