WEDNESDAY, MARCH 9, 1983
REVIEW OF INVESTOR PROTECTION SUGGESTED
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THERE WAS A NEED TO REVIEW THE WHOLE SUBJECT OF INVESTOR PROTECTION, THE HON BILL BROWN AND THE HON BENTON CHEUNG SAID AT THE LEGISLATIVE COUNCIL TODAY.
THEY WERE SPEAKING DURING THE RESUMED DEBATE ON THE PROTECTION OF INVESTORS (AMENDMENT) BILL WHICH WAS APPROVED WITH AMENDMENTS.
THE BILL PROVIDES FOR SELECTIVE CONTROLS+ ON ADVERTISEMENTS FOR PAPER GOLD SCHEMES, MAKING THEM SUBJECT TO ADVANCE VETTING BY THE SECURITIES COMMISSION.
MR BROWN, CONVENER OF AN AD HOC GROUP OF UNOFFICIALS FORMED TO STUDY THE BILL, SAID ACHIEVEMENT OF THE BILL'S AIM WOULD DEPEND TO SOME EXTENT ON THE ABILITY OF THE AUTHORITIES TO ENFORCE ITS PROVISIONS.
+ IT MAY BE RELATIVELY EASY TO STOP UNAUTHORISED ADVERTISING IN THE MEDIA, BUT MANY OF THE SCHEMES WE ARE ATTEMPTING TO DISCOURAGE ARE SOLD TO THE PUBLIC BY HIGH PRESSURE SALESMEN MAKING CONTACT BY TELEPHONE AND PERSONAL VISITS.
+THIS OF COURSE COMES WITHIN THE MEANING OF INVITATION TO INVEST', AS DEFINED BY THE ORDINANCE, BUT IT IS DIFFICULT TO POLICE.
+INDEED, I UNDERSTAND FROM THE COMMISSIONER FOR SECURITIES THAT NO ONE HAS EVER BEEN CHARGED UNDER THE PROTECTION OF INVESTORS ORDINANCE SINCE IT WAS ENACTED IN 1974, WHICH PERHAPS UNDERLINES THE POINT, FOR I WOULD FIND IT DIFFICULT TO BELIEVE THERE HAVE BEEN NO INFRINGEMENTS, MR BROWN SAID.
WHILE SUPPORTING THE AMENDMENT BILL AS A STEP IN THE RIGHT DIRECTION, HR BROWN NEVERTHELESS EXPRESSED FEAR THAT THE PUBLIC WOULD NOT BE PROPERLY PROTECTED UNTIL THE COMMODITIES TRADING ORDINANCE WAS ALSO GIVEN MORE TEETH..
HE CALLED FOR AN ASSURANCE THAT THE WORKING PARTY <WAS EXAMINING THE COMMODITIES TRADING ORDINANCE WITH A DEGREE OF URGENCY+
MR CHEUNG SPOKE AT LENGTH ON CONTROLS ON PERMITTED ADVERTISING.
HE SAID JUST AS A PAPER GOLD SCHEME COULD BE CLEVERLY DESIGNED TO ESCAPE THE CLUTCHES OF THE LAW, SO COULD ADVERTISING BE CREATED TO DO THE SAME,
»I THINK A LAYMAN READING THE PROTECTION OF INVESTORS ORDINANCE WOULD WONDER IF ADVERTISING COVERS ANYTHING MORE THAN PAID INSERTIONS IN THE EYES OF THE LAWT+ HE SAID,
+FOR EXAMPLE, IF A NEWSPAPER OR MAGAZINE REVIEWS AN INVESTMENT SCHEME, OR INTERVIEWS A MERCHANT! IF A CAREFULLY-WORDED SCHEME OFFER IS SENT TO HOUSEHOLDERS BY MAIL: IF SCHEME MERCHANTS HIRE A FUNCTION ROOM AND CONDUCT DIRECT SALES BY PRIVATE OFFER ONLY DO THESE METHODS CONSTITUTE ADVERTISING'?
/+I SEEK