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Hong Kong Regulator Fines UBS $1.5 Million for Compliance Breaches

Swiss bank punished for disclosure failings from 2004-2018; It also admitted other legal breaches to regulators

A weak yuan is generally tied to flat China share performances, a UBS economist said.
James Wang of UBS said another avenue where a depreciating yuan could lower stock value is via unhedged foreign debt on the balance sheet. File photo: AFP.

• Swiss bank punished for disclosure failings from 2004-2018

• It also admitted other legal breaches to regulators


Swiss bank UBS was fined HK$11.55 million ($1.5 million) by Hong Kong’s securities regulator for failing to disclose its holdings in some companies covered in its research reports, the watchdog said on Tuesday.

The Hong Kong Securities and Futures Commission (SFC) said in a statement that the bank’s failure to disclose its financial interests in the reports published between 2004 and 2018 was attributed to an error in using legacy technology, which tracked the share holdings of UBS.

The fines were also related to four other compliance breaches, including the bank’s failure to record 35 telephone lines between August 2017 and 2019 involving over 2,000 transactions undertaken for more than 400 clients.

UBS reported the issue to the Hong Kong Monetary Authority, which then alerted the SFC, the regulator said.

The bank was also found to not have received proper authorisation from 91 clients who were not classified as professional investors in respect of 913 securities-pooled lending transactions.

It did not obtain previous trading evidence from clients participating in some derivatives deals to assess their knowledge and also did not inform 15 clients of the “stop loss event” mechanism on a structured note deal, the SFC said.

“UBS self-identified and reported these matters to the Hong Kong regulators as soon as we found the issues,” the bank said in a statement.

“We immediately took steps to strengthen our internal controls and systems in order to prevent the issues from happening again.”


  • Reuters



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