avatar image
Advertisement

Minority shareholders urge securities watchdog to appeal Citic misconduct ruling

Lawmaker James To Kun-sun has helped about 200 Citic small shareholders who suffered losses to seek redress

Reading Time:2 minutes
Why you can trust SCMP
0
Lawmaker James To (second from left) and Citic’s small shareholders have urged the SFC to appeal against a ruling by the Market Misconduct Tribunal that cleared former chairman Larry Yung and four other ex-directors of misconduct and of providing misleading information over losses from foreign-currency bets in 2008. Photo: Felix Wong
Minority shareholders of Citic Ltd have urged Hong Kong’s financial market watchdog to appeal against a ruling by the Market Misconduct Tribunal that cleared former chairman Larry Yung Chi-kin and four other ex-directors of misconduct and of providing misleading information to the investing public over massive losses from wrong-way foreign-currency bets in 2008.

“The Citic case has implications for the wider public interest besides those of its small shareholders,” said lawmaker James To Kun-sun, who has helped about 200 Citic small shareholders who suffered losses to seek redress.

“If the Securities and Futures Commission does not appeal, the case may become a reference case under common law, affecting its future regulatory work over governance of listed firms.”

Citic is China’s largest conglomerate and its first state-backed firm to tap overseas capital markets to fund business expansion.

It was led by Yung, a son of the late Rong Yiren, who was dubbed the “Red Capitalist” and China’s vice-president from 1993 to 1998.

Larry Yung is among Citic’s executives cleared of misconduct by the Market Misconduct Tribunal. Photo: Kenneth Chan
Larry Yung is among Citic’s executives cleared of misconduct by the Market Misconduct Tribunal. Photo: Kenneth Chan
Citic, then known as Citic Pacific, announced on October 20, 2008, that it had made a potential HK$15.5 billion (US$2 billion) loss from “unauthorised” foreign-currency trades, six weeks after management claimed they first learned about losses from such trades on September 7.
Eric Ng
Eric joined the Post in 1998 after brief stints in a trading company, and translation and editing roles at Dow Jones and Edinburgh Financial Publishing. He has over 20 years of experience covering China's energy, mining and industrial materials sectors, and has reported on China's healthcare and biotechnology sectors for three years. Currently, he leads the Post's coverage on climate change, energy transition and sustainability topics. Eric has a Masters of Business Administration degree.
Advertisement