Hong Kong SFC Obtains Bank Accounts & Properties Preservation Orders in Canada British Columbia Against ex-CEO of SMI Culture & Travel Group Anita Leung to Sell or Transfer Assets, Had Obtained Hong Kong Court Injunction to Freeze $30 Million of Assets in Hong Kong in 2024 May, Lawsuit Against Senior Executives for Fraud with SMI Acquiring $41 Million of Overpriced Assets & Transferring Fees of $4.4 Million to $9.4 Million to Companies Owned Senior Executives
7th June 2024 | Hong Kong
The Hong Kong Securities & Futures Commission (SFC) has obtained banks accounts & properties preservation orders in Canada British Columbia against former CEO of SMI Culture & Travel Group Anita Leung to sell or transfer assets. In 2024 May, Hong Kong SFC had obtained a court injunction (6/5/24) to freeze $30 million (HKD 235 million) of assets against former CEO of SMI Culture & Travel Group Anita Leung, with the SFC ongoing lawsuit against the senior executives for fraud with company (SMI) acquiring $41 million of overpriced assets and transferring fees of $4.4 million to $9.4 million to companies owned the (SMI) senior executives. Hong Kong SFC (5/6/24): “The Securities and Futures Commission (SFC) has obtained preservation orders against Ms Leung Anita Fung Yee Maria, former chief executive officer and executive director of SMI Culture & Travel Group Holdings Limited (SMI Culture & Travel Group), with the assistance of the British Columbia Securities Commission (BCSC) of Canada. The preservations orders restrain Leung and certain banks where she holds accounts from disposing of and transmitting assets and properties she holds in British Columbia, Canada (Note 1). On 17 May 2024, the BCSC issued the preservation orders at the request of the SFC made pursuant to the International Organization of Securities Commissions Enhanced Multilateral Memorandum of Understanding Concerning Consultation and Cooperation and the Exchange of Information (IOSCO EMMoU). Both the SFC and the BCSC are signatories to the IOSCO EMMoU (Note 2). The preservation orders against Leung will remain in effect until the BCSC issues a further order to vary or revoke them. This came after the SFC obtained an interim injunction order at the Court of First Instance of Hong Kong on 6 May 2024 against Leung. The injunction order prohibits her from, among other things, disposing of or diminishing the value of any of her assets, whether within or outside Hong Kong, up to the value of $235,363,373 (Note 3). The injunction order will remain in place until the final determination of the proceedings against Leung in Hong Kong (Note 4).” In 2023 October, the Hong Kong Securities & Futures Commission (SFC) obtained a court injunction to disallow the completion of the sale of 2 properties in Shanghai & Canada, having earlier in September 2023 obtained an interim injunction to prohibit completing selling of individual assets of value above HKD 50,000 ($6,300) against former CEO of SMI Culture & Travel Group Anita Leung, with the SFC lawsuit against the senior executives for fraud with company (SMI) acquiring $41 million of overpriced assets and transferring fees of $4.4 million to $9.4 million to companies owned the (SMI) senior executives. More info below:
“ Hong Kong SFC Obtains Bank Accounts & Properties Preservation Orders in Canada British Columbia Against ex-CEO of SMI Culture & Travel Group Anita Leung to Sell or Transfer Assets, Had Obtained Hong Kong Court Injunction to Freeze $30 Million of Assets in Hong Kong in 2024 May, Lawsuit Against Senior Executives for Fraud with SMI Acquiring $41 Million of Overpriced Assets & Transferring Fees of $4.4 Million to $9.4 Million to Companies Owned Senior Executives “
Hong Kong SFC Executive Director of Enforcement, Christopher Wilson: “The IOSCO multilateral enforcement cooperation framework provides a potent mechanism for regulators to cooperate to prevent evasion of legal liability. In this case, the preservation orders amply demonstrate the importance of close cooperation among regulators to safeguarding the integrity of markets, protecting investors and combating misconduct and fraud in today’s interconnected global financial markets.”
Notes:
- The principal business of SMI Culture & Travel Group, founded by Leung and Mr Philip Wong Yu Hong (deceased), was providing media services including TV programme and production related services, TV advertising, and other public relations services in the People’s Republic of China. The company’s shares were listed on The Stock Exchange of Hong Kong Limited on 30 June 2004 and delisted on 21 March 2022.
- The IOSCO EMMoU provides a framework for international cooperation in the enforcement of securities and derivatives laws and regulations.
- For further details, please refer to the SFC’s press release dated 7 May 2024.
- The SFC commenced legal proceedings under section 214 of the Securities and Futures Ordinance in October 2019 against Leung and two other senior executives of SMI Culture & Travel Group. They are Wong, former chairman and non-executive director, and Mr Tsiang Hoi Fong, former executive director. The date of the trial has yet to be fixed.
Hong Kong SFC Obtains Court Injunction to Freeze $30 Million of Assets Against Former CEO of SMI Culture & Travel Group Anita Leung, Lawsuit Against Senior Executives for Fraud with SMI Acquiring $41 Million of Overpriced Assets & Transferring Fees of $4.4 Million to $9.4 Million to Companies Owned Senior Executives
8th May 2024 – The Hong Kong Securities & Futures Commission (SFC) has obtained a court injunction (6/5/24) to freeze $30 million (HKD 235 million) of assets against former CEO of SMI Culture & Travel Group Anita Leung, with the SFC ongoing lawsuit against the senior executives for fraud with company (SMI) acquiring $41 million of overpriced assets and transferring fees of $4.4 million to $9.4 million to companies owned the (SMI) senior executives. Hong Kong SFC (7/5/24): “The Securities and Futures Commission (SFC) has obtained an interim injunction order at the Court of First Instance against Ms Leung Anita Fung Yee Maria, former chief executive officer and executive director of SMI Culture & Travel Group Holdings Limited (SMI Culture & Travel Group), following the hearing of a Mareva injunction application on 6 February 2024. This is the first time where the SFC has obtained injunction orders of this kind in relation to an ongoing legal action under section 214 of the Securities and Futures Ordinance (SFO). The aim of the SFC’s action is to preserve assets to satisfy any compensation order that the Court may impose at the conclusion of the SFC’s legal proceedings against Leung and two others. Under the order granted by the Court on 6 May 2024, Leung must not (i) remove from Hong Kong any of her assets; (ii) dispose of or deal with or diminish the value of any of her assets, whether within or outside Hong Kong, up to the value of $235,363,373. Leung is also prohibited to take any steps to implement the terms and/or proceed to completion of the two sale and purchase agreements she allegedly entered in August 2023 in relation to her two properties in Shanghai and Canada. The order against Leung would remain in place until the final determination of proceedings. In granting this order, the Court is satisfied that the evidence put forward by the SFC has demonstrated that “Leung is adept at using an extensive network of corporate and offshore entities as nominees for channeling funds and for concealing her illicit activities” and in its view, Leung “would have little hesitation in dissipating assets to avoid the consequence of a judgment against her”.” In 2023 October, the Hong Kong Securities & Futures Commission (SFC) obtained a court injunction to disallow the completion of the sale of 2 properties in Shanghai & Canada, having earlier in September 2023 obtained an interim injunction to prohibit completing selling of individual assets of value above HKD 50,000 ($6,300) against former CEO of SMI Culture & Travel Group Anita Leung, with the SFC lawsuit against the senior executives for fraud with company (SMI) acquiring $41 million of overpriced assets and transferring fees of $4.4 million to $9.4 million to companies owned the (SMI) senior executives. More info below:
The SFC’s Executive Director of Enforcement, Mr Christopher Wilson: “The SFC is determined to bring wrongdoers to justice and to hold them accountable for their misconduct. To this end, the SFC will not hesitate to bring the full force of its legal powers to bear upon wrongdoers to prevent them from escaping legal liability.”
Notes:
- The principal business of SMI Culture & Travel Group – founded by Leung and Mr Philip Wong Yu Hong (deceased) – was providing media services including TV programme and production related services, TV advertising, and other public relations services in the People’s Republic of China. The company’s shares were listed on The Stock Exchange of Hong Kong Limited on 30 June 2004 and delisted on 21 March 2022.
- The Mareva injunction application was first made by the SFC on 19 September 2023. Two interim injunction orders against Leung, temporary in nature, were granted by the Court on 22 September 2023 and 19 October 2023. For further details, please refer to the SFC’s press releases dated 25 September 2023 and 24 October 2023.
- The SFC commenced legal proceedings under section 214 of the SFO in October 2019 against Leung and two other senior executives of SMI Culture & Travel Group. They are Wong, former chairman and non-executive Director, and Mr Tsiang Hoi Fong, former executive director. The date of the trial has yet to be fixed.
Hong Kong SFC Obtains Court Injunction to Disallow the Completion of Sale of 2 Properties in Shanghai & Canada, Earlier Obtained Interim Injunction to Prohibit Selling Individual Assets of Value Above HKD 50,000 Against Former CEO of SMI Culture & Travel Group Anita Leung, Lawsuit Against Senior Executives for Fraud with SMI Acquiring $41 Million of Overpriced Assets & Transferring Fees of $4.4 Million to $9.4 Million to Companies Owned Senior Executives
26th October 2023 – The Hong Kong Securities & Futures Commission (SFC) has obtained a court injunction to disallow the completion of the sale of 2 properties in Shanghai & Canada, having earlier in September 2023 obtained an interim injunction to prohibit completing selling of individual assets of value above HKD 50,000 ($6,300) against former CEO of SMI Culture & Travel Group Anita Leung, with the SFC lawsuit against the senior executives for fraud with company (SMI) acquiring $41 million of overpriced assets and transferring fees of $4.4 million to $9.4 million to companies owned the (SMI) senior executives. More info below:
Hong Kong SFC Obtains Court Injunction to Disallow the Completion of Sale of 2 Properties in Shanghai & Canada
24th October 2023 – The Securities and Futures Commission (SFC) has taken action to restrain Ms Leung Anita Fung Yee Maria, former chief executive officer and executive director of SMI Culture & Travel Group Holdings Limited (SMI Culture & Travel Group), from proceeding to complete the sale of her two properties in Shanghai and Canada (Note 1).
The aim of the SFC’s action is to preserve assets for satisfying a compensation order that the court may impose at the conclusion of the legal proceedings brought by the SFC under section 214 of the Securities and Futures Ordinance in October 2019 against Leung and two other senior executives of SMI Culture & Travel Group, namely Mr Philip Wong Yu Hong (deceased), former chairman and non-executive director, and Mr Tsiang Hoi Fong, former executive director.
To this end, the SFC obtained an interim injunction order at the Court of First Instance against Leung on 22 September 2023. Under the interim injunction order, Leung is required, amongst other things, to notify the SFC of the execution of a sale and purchase agreement of the specified properties of hers in Hong Kong, Shanghai and Canada, pending the determination of the SFC’s injunction application made on 19 September 2023 to prohibit her from disposing assets in Hong Kong and elsewhere (Injunction Application) (Note 2).
Subsequently and pursuant to the interim injunction order, Leung notified the SFC that she had entered into sale and purchase agreements for her two properties in Shanghai and Canada (SPAs). The SFC considered the SPAs and was concerned that the completion of the SPAs may result in the dissipation of Leung’s assets.
As a result, the SFC made another application to the court on 17 October 2023 seeking to restrain the completion of the SPAs until the determination of the Injunction Application. Following the SFC’s application, Leung gave an undertaking to the court not to implement the terms and/or proceed to completion of the SPAs until the determination of the Injunction Application except with the prior consent of the SFC or leave of the court. If Leung breaches the undertaking, she may be guilty of contempt of court. The undertaking of Leung has the effect of preserving the status quo pending the determination of the SFC’s Injunction Application.
Notes:
- The principal business of SMI Culture & Travel Group – founded by Leung and Philip Wong Yu Hong – was providing media services including TV programme and production related services, TV advertising, and other public relations services in the People’s Republic of China. The company’s shares were listed on The Stock Exchange of Hong Kong Limited on 30 June 2004 and delisted on 21 March 2022.
- For further details, please refer to the SFC’s press release dated 25 September 2023.
Hong Kong SFC Obtains Interim Injunction to Prohibit Selling Individual Assets of Value Above HKD 50,000 Against Former CEO of SMI Culture & Travel Group Anita Leung, Lawsuit Against Senior Executives for Fraud with SMI Acquiring $41 Million of Overpriced Assets & Transferring Fees of $4.4 Million to $9.4 Million to Companies Owned Senior Executives
28th September 2023 – The Hong Kong Securities & Futures Commission (SFC) has obtained an interim injunction to prohibit selling individual assets of value above HKD 50,000 ($6,300) against former CEO of SMI Culture & Travel Group Anita Leung, with the SFC lawsuit against the senior executives for fraud with company (SMI) acquiring $41 million of overpriced assets and transferring fees of $4.4 million to $9.4 million to companies owned the (SMI) senior executives. Hong Kong SFC: “The application for an interim injunction order to prohibit Leung from disposing assets in Hong Kong and elsewhere stemmed from new information the SFC recently received regarding her. There is indication of a real risk of dissipation of assets by Leung. CFI granted an interim injunction order following an application by the SFC on 19 September 2023, pending the substantive hearing of the SFC’s injunction application … … The SFC commenced the legal proceedings under section 214 of the Securities and Futures Ordinance (SFO) in October 2019 against Leung and two other senior executives of SMI Culture & Travel Group. They are Mr Philip Wong Yu Hong (deceased), former chairman and non-executive Director, and Mr Tsiang Hoi Fong, former executive director. The SFC alleges that at the material times between 2010 and 2012, Leung, Wong and/or Tsiang implemented a fraudulent scheme under the guise of numerous non-genuine sale and purchase agreements in relation to TV licence rights with a total consideration of $327.75 million, resulting in substantially overpriced assets being purchased by SMI Culture & Travel Group. The resulting losses suffered by SMI Culture & Travel Group was estimated to be around $235.36 million, while the unjust profits gained by Leung or Wong was in the range of $35.2 million to $74.27 million, being the sums transferred to Leung and/or companies owned by Leung or Wong. As part of the legal action, the SFC is also seeking disqualification orders, and a compensation order for losses suffered by SMI Culture & Travel Group or alternatively an order to account for any profits gained by the respondents as a result of the alleged fraudulent scheme.” More info below:
Hong Kong SFC Obtains Interim Injunction to Prohibit Selling Individual Assets of Value Above HKD 50,000 Against Former CEO of SMI Culture & Travel Group Anita Leung
25th September 2023 – The Securities and Futures Commission (SFC) has obtained an interim injunction order at the Court of First Instance (CFI) against Ms Leung Anita Fung Yee Maria, former chief executive officer and executive director of SMI Culture & Travel Group Holdings Limited (SMI Culture & Travel Group), to preserve assets for satisfying a compensation order that the court may impose at the conclusion of legal proceedings brought by the SFC (Note 1).
The application for an interim injunction order to prohibit Leung from disposing assets in Hong Kong and elsewhere stemmed from new information the SFC recently received regarding her. There is indication of a real risk of dissipation of assets by Leung. CFI granted an interim injunction order following an application by the SFC on 19 September 2023, pending the substantive hearing of the SFC’s injunction application.
Under the interim injunction order, Leung must (i) inform the SFC in writing all her assets of an individual value of $50,000 or more, whether in or outside Hong Kong, whether in her own name or not and whether solely or jointly owned; (ii) notify the SFC of the execution of a sale and purchase agreement of, creation of any new encumbrance on and the drawing down of any new loan secured by the specified properties of her in Hong Kong, Shanghai and Canada; and (iii) not dispose of, deal with or diminishing the purchase price, the loan monies or any monies generated by relevant encumbrance unless 28 days have elapsed from the notification to the SFC.
The SFC commenced the legal proceedings under section 214 of the Securities and Futures Ordinance (SFO) in October 2019 against Leung and two other senior executives of SMI Culture & Travel Group. They are Mr Philip Wong Yu Hong (deceased), former chairman and non-executive Director, and Mr Tsiang Hoi Fong, former executive director (Note 2).
The SFC alleges that at the material times between 2010 and 2012, Leung, Wong and/or Tsiang implemented a fraudulent scheme under the guise of numerous non-genuine sale and purchase agreements in relation to TV licence rights with a total consideration of $327.75 million, resulting in substantially overpriced assets being purchased by SMI Culture & Travel Group. The resulting losses suffered by SMI Culture & Travel Group was estimated to be around $235.36 million, while the unjust profits gained by Leung or Wong was in the range of $35.2 million to $74.27 million, being the sums transferred to Leung and/or companies owned by Leung or Wong. As part of the legal action, the SFC is also seeking disqualification orders, and a compensation order for losses suffered by SMI Culture & Travel Group or alternatively an order to account for any profits gained by the respondents as a result of the alleged fraudulent scheme (Notes 3 & 4).
Notes:
- The principal business of SMI Culture & Travel Group – founded by Leung and Philip Wong Yu Hong – was providing media services including TV programme and production related services, TV advertising, and other public relations services in the People’s Republic of China. The company’s shares were listed on The Stock Exchange of Hong Kong Limited on 30 June 2004 and delisted on 21 March 2022.
- Wong passed away after the commencement of the proceedings. On 24 October 2022, the SFC took out a summons seeking an order that executor(s) of the estate of Wong (or any other person as the Court thinks fit) be appointed to represent the estate of Wong for the purpose of these proceedings, which will be heard on 29 January 2024.
- Under section 214 of the SFO, the court may, amongst other things, make orders to disqualify a person from being a director or being involved, directly or indirectly, in the management of any corporation for a period of up to 15 years, if the person is found to be wholly or partly responsible for the company’s affairs having been conducted in a manner, amongst other conduct, involving defalcation, fraud, misfeasance or other misconduct towards the company or its members.
- SMI Culture & Travel Group is also a respondent in the section 214 proceedings. In November 2020, SMI Culture & Travel Group was ordered to be wound up, and joint and several liquidators were appointed. In December 2021, the SFC obtained a court order to proceed with the section 214 proceedings as against the company.
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