Hong Kong SFC fines Victory Securities HK$1.7 million and suspends responsible officer

News Editor

2026-07-24 08:52:02

Hong Kong’s Securities and Futures Commission said Victory Securities Company Limited was reprimanded and fined HK$1.7 million over regulatory breaches in its handling of a client account. The regulator also suspended the licence of Chiu Tsz Leung, a responsible officer and core function holder, for three months from July 22, 2026 to October 21, 2026. According to the SFC, the misconduct came to light during an investigation into a suspected ramp-and-dump scheme. The client opened the account on October 29, 2019, later placed two share-sale instructions, and submitted statements said to be issued by other brokers as proof of holdings. The SFC said the value of those holdings was clearly inconsistent with the client’s declared financial situation, yet Victory Securities did not make sufficient inquiries before executing the orders or obtain reasonable explanations for the warning signs. Later information indicated the client may have submitted false documents to facilitate one of the trades, but the firm did not report the suspected fraud or deception to the SFC. In deciding the sanctions, the regulator said it took into account that the case was isolated, no systemic internal control failure was found, the firm had strengthened its policies and procedures and carried out mandatory training, and both the company and Chiu cooperated with the investigation.

Hong Kong’s Securities and Futures Commission said Victory Securities Company Limited was reprimanded and fined HK$1.7 million for regulatory breaches tied to its handling of a client account. The SFC also suspended the licence of Chiu Tsz Leung, a responsible officer and core function holder, for three months, from July 22, 2026 to October 21, 2026.

Issues surfaced during probe into suspected ramp-and-dump scheme

The SFC said the misconduct was uncovered while it was investigating a suspected ramp-and-dump scheme. The client involved opened the account on October 29, 2019, then gave two share-sale instructions and submitted statements said to have been issued by other brokers as proof of stock holdings.

The regulator said the value of those holdings was clearly inconsistent with the financial position the client had declared in the account-opening documents. Even so, Victory Securities did not make sufficient inquiries before carrying out the instructions, and it failed to obtain reasonable explanations for the warning signs.

Possible false documents were not reported to the regulator

Later information showed that the client may have submitted false documents to facilitate one of the transactions. The SFC said Victory Securities did not report the suspected fraud or deceptive conduct to the regulator.

In the SFC’s view, the firm’s handling of the matter fell short of the standards required under the Code of Conduct as well as anti-money laundering rules and guidance. The regulator also said the failings were attributable to Chiu’s failure to properly discharge his duties as a responsible officer and a member of senior management.

SFC says case was isolated and cites remedial steps

When determining the sanctions, the SFC said it had taken several factors into account. It described the matter as an isolated case and said it found no systemic weakness in Victory Securities’ internal controls. The regulator also noted that the firm had enhanced its policies and procedures and conducted mandatory training. In addition, both Victory Securities and Chiu cooperated with the investigation, and Chiu had no previous disciplinary record.

This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan.

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