The Securities and Futures Commission obtained Court of First Instance orders requiring Mr Andrew Liu and Mr Quincy Hui Kwong Hei, former directors of Arta TechFin Corporation Limited, to compensate the company HKD 57.5 million for losses arising from its acquisition and disposal of a stake in Liu’s Holdings Limited, and disqualifying them from acting as directors or taking part in management for eight years and six years respectively. The court also disqualified seven other former executive and independent non-executive directors for one to two years and ordered all respondents to pay the SFC’s legal costs, with Liu’s misconduct characterised as the most serious and Hui found to have played a major part in the transaction. The section 214 Securities and Futures Ordinance proceedings, commenced in October 2016, related to a transaction in 2011 when Arta TechFin (stock code: 279) was known as Freeman Financial Corporation Limited, with the stake disposed of within a few months and resulting in substantial losses. In making the orders, the court found the directors were responsible for the company’s affairs being conducted in an oppressive manner involving defalcation, misfeasance or other misconduct, and held that executive and non-executive directors bore the same legal responsibility to scrutinise proposals affecting shareholders; the case was disposed of through a Carecraft procedure based on agreed facts submitted in 2023 and the SFC withdrew its claim against one independent non-executive director.

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