Hong Kong’s Market Misconduct Tribunal has ordered Jonathan Dominic Iu Wai Ching, a former responsible officer of hedge fund Tarascon Capital Management (Hong Kong), to disgorge illicit profit of over $5.6m from false trading.
Iu has also been disqualified for four years following legal proceedings brought by the Securities and Futures Commission.
According to the SFC’s charges, on 22 trading days between August and September 2014, Iu placed contemporaneous orders in the shares of Sinopharm Tech Holdings and Quantum Thinking through the brokerage accounts of the hedge fund managed by Tarascon and of his mother, leading to opposing orders to be executed against each other. These matched trades, which had the effect of creating a false or misleading appearance of active trading, or with respect to the price for dealings, in the listed shares, resulted in gains of $5.6m in his mother’s brokerage account at the expense of the hedge fund.
At the material time, Iu, who was responsible for managing and making investment decision for the hedge fund, was also a director, the chief investment officer, and a substantial shareholder of Tarascon.
