Hong Kong's Securities and Futures Commission (SFC) reprimanded and fined CTSL $2 million for internal control deficiencies and a series of regulatory irregularities.。

The SFC also suspended the license of Kevin Chiu Koon Yu, the person in charge of the company, for a period of 10 months from September 15, 2023 to July 14, 2024.。

The SEC investigation found that between July 1, 2018 and March 5, 2020, CTSL did not have an order recording policy and did not comply with order recording requirements.。The company also does not have effective internal controls in place to monitor cross-transactions between employees and customers and to ensure that customers are treated fairly.。

In addition, the company did not establish and maintain an appropriate and effective monitoring system to detect and evaluate suspicious transactions in customer accounts.。The company also does not have systems and controls in place to identify and evaluate third-party deposits in customer accounts.。

CTSL does not require or obtain written authorization from third parties for the operation of customer accounts。

Finally, the company does not have internal controls in place to monitor employee transactions。

CTSL negligence constitutes a breach of the Code of Conduct, the Internal Control Guidelines and the SFC's Notice to Licensed Corporations and Associated Entities on 31 May 2019 - Third Party Deposits and Payments。

The SFC considers that CTSL's default can be attributed to the failure of Kevin Chiu Koon Yu in performing his duties as a principal and member of senior management, and questions whether he is a fit and proper person.。

In determining disciplinary sanctions, the SFC has considered all relevant circumstances, including CTSL's financial condition, CTSL's cessation of business, CTSL and Kevin Chiu Koon Yu's cooperation in addressing the SFC's concerns, and their disciplinary record with the SFC has no adverse track record.。