The officers, who have been with CCB for five and two years, respectively, have already worked with the SFC Enforcement Division on a number of securities fraud cases - two of which are still in progress. Moreover, both were members of a CCB Focus Group on 'Market Manipulation & Insider Trading' set up in 2001 to prepare for the challenges posed by the new Securities & Futures Ordinance (SFO).

"The SFO is expected to come into force by next April, "Mr Kong told OffBeat," and will consolidate 10 existing ordinances. 'Insider Dealing' has become a criminal offence for the first time and there are significant increases in the penalties for 'Market Misconduct'. The SFO also gives the SFC much wider investigative and supervisory powers, and this will enable SFC and CCB to detect 'Market Misconduct' more readily and efficiently."

Close Collaboration

SFC Senior Director of Enforcement, Mr Eric Cheng Kai-sum, explained: "Of course, there has always been close collaboration between the SFC and CCB. The Enforcement Division of the SFC was set up to monitor, investigate and discipline or prosecute corporations or individuals breaching any of the regulations covered by 10 separate ordinances. However, when an SFC investigation revealed a criminal fraud or serious breach of these ordinances, CCB was usually asked to handle the relevant investigation and prosecution," said Mr Cheng.

SFC Director of Enforcement, Mr Richard Chow Kam-to, added that: "Both SFC and CCB need to fully appreciate the extent of their respective powers and modus operandi in the investigation and prosecution of cases involving corporate and securities fraud. We intend to further enhance liaison between those engaged in regulatory and enforcement duties so that a firm and effective partnership can be established."

Knowledge Sharing

Ms Kung said: "To play a full part in a firm and effective partnership, the CCB needs to acquire the expertise to handle investigations and prosecutions under the SFO. We are going to learn the appropriate surveillance techniques for 'Market Misconduct'.

"And we are well on our way to doing exactly that. Within the first few days we had met the majority of the staff, and been taken under the wing of several managers and senior managers. Already we have made a great many friends here and that will ensure warm SFC-CCB relations in the future," she added.

"We are now studying past SFC investigations and getting hands-on experience in cases which are in progress and it's a fascinating experience," Mr Kong said. "We have noticed that there are some differences in the way the two organisations work. Most SFC officers are qualified accountants and lawyers and they tend to work individually, whereas in CCB we rely more on teamwork and group discussions. That makes the SFC working environment quieter than that of the CCB," he added.

Offbeat asked Mr Kong about his post-secondment plans. "It will be our responsibility to share with our colleagues all the knowledge and experience we have gained to better prepare CCB for the challenges the SFO will pose," he said.

SIP Mr Kong Man-keung (left), WIP Ms Kung Hing-fun, SFC Director Mr Richard Chow Kam-to and SFC Senior Director Mr Eric Cheng Kai-sum: close collaboration