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practice adopted by other financial services both locally and overseas. The consultation period ended on December 10, 2007 and the SFC is reviewing the responses received.
In 2007, the SFC continued its rigorous supervision of licensed intermediaries. The SFC had identified two cases of broker frauds involving misappropriation of clients' assets. In each of those cases, the SFC took swift and decisive action to protect the interests of investors, such as imposing appropriate prohibition on the broker and applying to the court for appointment of an independent administrator to take over the broker's operations. These arrangements safeguarded and protected clients' interests.
In addition, the SFC continued to focus its enforcement resources on fighting. market misconduct and intermediaries who are dishonest or put clients at risk. By year-end, there were 14 outstanding investigations of listed companies. In relation to listed company investigations, the SFC obtained the first disqualification order against a former listed company director who will not be allowed to become a director or be involved in the management of any listed company, subsidiary or affiliate for four years. The SFC also commenced similar proceedings against five former directors of a listed company.
In two ongoing insider dealing cases, the SFC made two separate applications seeking urgent interim freezing orders over money and other property. These orders prevent assets and property held by or on behalf of persons suspected of being involved in insider dealing from being dissipated during the SFC's ongoing investigations.
During the year, the SFC successfully prosecuted nine entities for market manipulation and false or misleading disclosure, and summonses were issued to an additional nine entities but those cases were not concluded by year-end. In one of the market manipulation cases, the court for the first time, imposed an immediate prison sentence on the market manipulator. In the previous year, there were 10 successful prosecutions and two outstanding cases. There were 20 referrals to the Police.
Insurance Sector
Main Features
At year-end, there were 178 authorised insurers, 90 of which were incorporated in Hong Kong while the remaining 88 were incorporated on the Mainland and in 22 overseas countries, with the United States taking the lead.
The total gross premiums of the insurance industry reached $156 billion in 2006, representing 13.7 per cent growth over that in 2005. Gross premiums of the general insurance sector increased slightly by 1.8 per cent to $23 billion in 2006. The increase was mainly driven by the strong momentum registered in accident and health insurance business. Overall underwriting profit of general insurance business decreased from $2.5 billion in 2005 to $2.1 billion in 2006 due to higher claims and management expenses.