Hong Kong Securities and Futures Commission condemns Lu Hua Securities for mishandling client funds and fines them 2.1 million Hong Kong dollars.

According to the Wisdom Financial App, on September 29th, the Hong Kong Securities and Futures Commission condemned Lu Hua Securities Limited (Lu Hua) and imposed a fine of 2.1 million Hong Kong dollars for mishandling client funds in an improper manner, violating relevant regulatory requirements. The Hong Kong Securities and Futures Commission launched an investigation after a referral case from the Hong Kong Stock Exchange, and found that from February 8, 2021 to July 7, 2022, Lu Hua had failed to maintain sufficient funds in its separate client accounts on 12 occasions. In one instance, the shortfall in the client account reached 15.5 million Hong Kong dollars. The incident was due to Lu Hua using funds in the client account to meet margin calls issued or expected to be issued by the Hong Kong Stock Exchange, failure to properly manage their daily online banking transfer limits, and human errors made by their staff.