China Securities Regulatory Commission issues penalty notice and plans to confiscate all illegal gains from Tiger Brokers Futu and Longbridge for unlawful cross border securities business

The China Securities Regulatory Commission has opened investigations and issued prior notice of administrative penalties against Tiger Brokers NZ Limited, Futu Securities International Hong Kong Limited, Longbridge Securities Hong Kong Limited, and their related onshore and offshore entities for illegally conducting securities business in China. According to the notice, the firms carried out securities trading marketing and promotion, processed trading instructions and provided other securities services in China without CSRC approval or the required licences for securities brokerage and margin financing and securities lending, and received income from those activities. The CSRC also found that the related entities of the three firms illegally engaged in public fund sales and futures brokerage in breach of the Securities Investment Fund Law and the Futures and Derivatives Law. It plans to confiscate all illegal gains from the relevant onshore and offshore entities and impose penalties under the Securities Law, the Securities Investment Fund Law and the Futures and Derivatives Law. The parties have the right to make statements and arguments and to request a hearing before the CSRC makes a final administrative penalty decision. The commission said it will continue to crack down on overseas institutions that illegally conduct securities business in China.