The Hong Kong Securities and Futures Commission (SFC) has fined Swiss-Asia Asset Management (HK) HK$3m ($382,170) for internal control failings and breaches of financial regulation.
The asset manager failed to monitor trading activities in discretionary accounts and to keep records, the SFC said.
The disciplinary action followed an investigation by the regulator triggered by a client complaint. The customer claimed that some of the option trades made were much riskier than what was agreed and that they fell outside of the scope of the mandate given to the licensed representative of Swiss-Asia, according to the agreement representative had with the company between April 2015 and August 2016.
The SFC found deficiencies in the internal controls of Swiss Asia, including failures to:
- Properly monitor the trading activities in the client’s discretionary account for 15 months;
- Have procedures in place to ensure proper supervision of the operation of discretionary accounts; and
- Maintain proper records of its compliance checks on discretionary accounts.
The SFC did not name the licensed representative mentioned in the client complaint.
This story first appeared on our sister publication, International Adviser.
