Hong Kong SFC revokes Axial licence
Hong Kong Securities and Futures Commission revokes licence of Axial Capital Management Limited。
The Hong Kong Securities and Futures Commission (SFC) revoked Axial Capital Management Limited's licence for repeated non-compliance with the Securities and Futures (Financial Resources) Rules, the Securities and Futures Ordinance (SFO) and the Code of Conduct。
The SFC also suspended the licence of Mr. Eugene Chung, the person in charge of Axial, for a period of five years, from 7 September 2023 to 6 September 2028.。
The SFC's investigation found that Axial failed to maintain its liquidity requirements of $100,000 for 19 consecutive months from March 28, 2019 to October 16, 2020。When the situation arose, Axial notified the SFC 18 months later.。
In addition, the regulator found that despite SFC's repeated reminders to licensed corporations to file annual filings under the Securities and Futures Ordinance for the years ended 31 December 2019 and 31 December 2021, Axial failed to file its June 2019, December 2019, June 2020, June 2021, June 2022 and December 2022 semi-annual FRR returns and audited financial statements and other documents within the required deadlines.。
The SFC concluded that Axial's conduct not only violated the Securities and Futures Ordinance, the FRR and the Code of Conduct, but also flouted the FRR regime。In this case, Axial's conduct falls far short of the standards expected of a licensed intermediary。
The regulator found that Axial's failure was due to Chung's failure to perform his duties as a senior management of the company and as an RO, including failing to ensure that Axial maintained appropriate standards of conduct and followed due process, breaching the general principle that the senior management of a licensed corporation should bear primary responsibility for ensuring that the company maintained appropriate standards of conduct and followed due process.。
In deciding on disciplinary action, the SFC has considered all relevant circumstances, including Axial's failure to maintain the required liquidity and delay in notification, and Axial's cooperation with Chung in addressing the SFC's concerns。
Currently, Axial and Chung have no disciplinary record with the SFC.。
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