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PROBE ON INSIDER TRADING AND FURTHER CONTROLS ON DEPOSIT
TAKING COMPANIES PROPOSED
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TWO MAJOR ITEMS OF FINANCIAL LEGISLATION - ONE TO SET UP A STANDING TRIBUNAL TO INVESTIGATE ALLEGED INSIDER TRADING AND THE OTHER TO EXTEND TO REGISTERED DEPOSIT-TAKING COMPANIES SOME OF THE OBLIGATIONS AT PRESENT IMPOSED ON BANKS ARE PROPOSED FOR THIS SESSION OF THE LEGISLATIVE COUNCIL, THE GOVERNOR, SIR MURRAY MACLEHOSE SAID.
IN HIS OPENING ADDRESS TO THE LEGISLATIVE COUNCIL TODAY, SIR MURRAY SAID, THE GOVERNMENT HAS NOW REACHED A CONCLUSION ON WHAT STEPS IT SHOULD TAKE TO PROTECT INVESTORS IN THE DIFFICULT AREA OF INSIDER DEAL INGS.
+THE EXECUTIVE COUNCIL HAS NOW ADVISED THAT A STAND ING TRIBUNAL BE FORMED TO INVESTIGATE CASES OF ALLEGED INSIDER DEAL ING. THE COMMISSIONER FOR SECURITIES WILL BE CHARGED WITH THE TASK OF ESTBLISHING A PRIMA FACIE CASE AND IT WOULD BE THE RESPONSIBILITY OF THE FINANCIAL SECRETARY ON THE ADVICE OF THE SECURITIES COMMISSION TO DECIDE WHETHER OR NOT TO REFER SUCH CASES TO THE TRIBUNAL.
+ONCE THE TRIBUNAL HAS COMPLETED ITS INVESTIGATION - WHICH WOULD NORMALLY BE HELD IN PRIVATE IT WOULD BE REQUIRED TO PUBLISH ITS FINDINGS, SIR MURRAY SAID.
HE NOTED THAT THE ESTABLISHMENT OF SUCH A STANDING TRIBUNAL WILL REQUIRE AMENDMENTS TO THE SECURITIES ORDINANCE AND SAID, + HOPE THAT THIS PROPOSAL WILL COMMEND ITSELF TO HONOURABLE MEMBERS AS A FIRST STEP.
+ IN SUCH A DIFFICULT FIELD THERE IS A GOOD CASE FOR STARTING WITH A BODY WHICH WILL HAVE POWERS TO INVESTIGATE AND POWER AND OBLIGATION TO PRONOUNCE ON PROFESSIONAL STANDARDS BUT NOT POWER TO PUNISH DIRECTLY, BUT ONLY INDIRECTLY THROUGH THE AUTHORITATIVE GUIDANCE IT WILL GIVE TO PROFESSIONAL AND PUBLIC OPINION.
+ IN THE LIGHT OF EXPERIENCE OF THE WORKINGS OF THE TRIBUNAL AND OF HOA EFFECTIVE IT PROVES, IT WILL BE EASIER TO CONSIDER WHETHER MORE STRINGENT MEASURES ARE OR ARE NOT NECESSARY OR PRACTICABLE, SIR MURRAY SAID.
ON THE FURTHER CONTROL OF DEPOSIT-TAKING COMPANIES, HE SAID, +SUBJECT TO THE ADVICE OF THE EXECUTIVE COUNCIL PROPOSALS WILL BE INTRODUCED TO EXTEND TO REGISTERED DEPOSIT-TAKING COMPANIES SOME OF THE OBLIGATIONS AT PRESENT IMPOSED ONLY ON BANKS.
+THIS WILL WIDEN THE EXTENT OF SUPERVISION OVER THEM AND THUS ENABLE THE GOVERNMENT TO MEET ITS OBLIGATIONS TO PROTECT SMALL DEPOSITORS, AND ALSO ENSURE THAT THE GOVERNMENT HAS THE POWER TO ENSURE THAT THE FINANCIAL SYSTEM ADEQUATELY SERVES THE NEEDS OF HONG KONG.
IT IS NOT PROPOSED TO REMOVE THE PROHIBITION ON DEPOSIT-TAK ING COMPANIES OFFERING A RETAIL BANKING SERVICE,+ SIR MURRAY ADDED.
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