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Ex-banker goes to jail for insider trading
By Dikky Sinn |
September 19, 2009, Saturday
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Print Edition
Print Edition
AN ex-Morgan Stanley banker was sentenced yesterday to seven years in prison in Hong Kong's biggest insider trading case -- an "unprecedented" scam a judge said undermined the integrity of this leading Asian financial center.
Du Jun, a former managing director of the Wall Street investment bank, also was fined about HK$23.3 million (US$3 million).
The 41-year-old Beijing-native showed little emotion as a Hong Kong judge chastised him for his "greed" and "dishonesty and fraudulence." Du risked making the illegal trades even though he was earning well over US$2 million a year at Morgan Stanley.
"The scale was unprecedented," Judge Andrew Chan said, referring to the millions Du used in his trades.
Du's lawyer Alexander King declined to say whether his client would appeal, only saying "use your common sense."
Du was convicted last week of nine counts of insider dealing for trading shares of CITIC Resources Holdings Ltd before the company's announcement of an acquisition in 2007. He was also found guilty of a 10th related charge for helping his wife to deal in the shares.
The case marks the 10th conviction of insider trading since it was made a criminal offense in 2003 -- part of Hong Kong's effort to tighten regulation as it seeks to retain its status as a leading financial center.
It is also the longest and most heavily contested trial on insider dealing in the territory, according to Hong Kong regulators, who were quick to hold up the sentence as evidence of their stepped-up efforts against financial malfeasance. In years past, Hong Kong's regulators have been criticized as toothless and favoring the business elite's interests.
"This sentencing sends the strongest possible message to anyone tempted to commit insider dealing offense in the future," said Mark Steward, executive director of enforcement at the local security watchdog, the Securities and Futures Commission.
Du was also banned from being a director or managing director of any listed company for five years.
Du Jun, a former managing director of the Wall Street investment bank, also was fined about HK$23.3 million (US$3 million).
The 41-year-old Beijing-native showed little emotion as a Hong Kong judge chastised him for his "greed" and "dishonesty and fraudulence." Du risked making the illegal trades even though he was earning well over US$2 million a year at Morgan Stanley.
"The scale was unprecedented," Judge Andrew Chan said, referring to the millions Du used in his trades.
Du's lawyer Alexander King declined to say whether his client would appeal, only saying "use your common sense."
Du was convicted last week of nine counts of insider dealing for trading shares of CITIC Resources Holdings Ltd before the company's announcement of an acquisition in 2007. He was also found guilty of a 10th related charge for helping his wife to deal in the shares.
The case marks the 10th conviction of insider trading since it was made a criminal offense in 2003 -- part of Hong Kong's effort to tighten regulation as it seeks to retain its status as a leading financial center.
It is also the longest and most heavily contested trial on insider dealing in the territory, according to Hong Kong regulators, who were quick to hold up the sentence as evidence of their stepped-up efforts against financial malfeasance. In years past, Hong Kong's regulators have been criticized as toothless and favoring the business elite's interests.
"This sentencing sends the strongest possible message to anyone tempted to commit insider dealing offense in the future," said Mark Steward, executive director of enforcement at the local security watchdog, the Securities and Futures Commission.
Du was also banned from being a director or managing director of any listed company for five years.
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