The Hong Kong High Court has refused to throw out insider trading claims against a former Slaughter and May lawyer and her boyfriend, an ex-Linklaters lawyer.
The Hong Kong Securities and Futures Commission (SFC) allege that the pair colluded with family to use inside information to trade shares, making a total profit of HK$2.9m (£232,000) from two separate transactions.
Young Bik Fung, previously a lawyer in Slaughter and May’s Hong Kong office, and her boyfriend, ex-Linklaters lawyer Lee Kwok Wa, both deny the claims levelled against them. The Hong Kong SFC filed the claim in December 2010.
The first set of allegations related to the trading of shares in Hsinchu International Bank in 2006 while the second allegations relate to Asia Satellite Telecommunications Holdings in 2007.
According to Bloomberg, Hong Kong High Court judge Anthony Chan refused to accept arguments from the defendants that the regulator lacked jurisdiction to bring the case because Hsinchu Bank was listed in Taiwan. The four reportedly claimed they bought the shares of the two companies without any inside information.
The regulator alleges that Young had obtained confidential, non-public and materially price sensitive information about a tender offer on the bank’s shares while working on the deal as a lawyer seconded to Standard Chartered Bank, a Slaughter and May client. It is alleged that she bought Hsinchu Bank shares and tipped off her boyfriend Lee and his two sisters to buy the shares before the tender was made public.
The second allegation relates to Asia Satellite transactions. The SFC alleges that Lee obtained inside information about the privatisation of Asia Satellite shares whilst he worked at Linklaters, which was advising on the transaction. He then allegedly tipped off his girlfriend Young and his two sisters to buy the company’s shares before the announcement of the proposed deal.
As reported by Bloomberg, the defendants are represented by Hong Kong lawyer Maurice Lee of Lee Maurice W M.
Slaughter and May and Linklaters declined to comment on the matter.