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China Fordoo (2399) controller moves 50.9% from Zhongtai to Donghai
Webb-site.com, 14-Dec-2017
This comes 1 year and 1 day after the block moved from HSBC to Zhongtai. The shares were pledged to Zhongtai, so this suggests that the controller (owned by the Chairman and his wife) may have remortgaged the shares. The SFC issued a concentration warning on the stock on 16-Dec-2016.
Bitcoin: the World's first decentralised Ponzi scheme
Webb-site.com, 14-Dec-2017
So long as we have governments with the power to tax and spend in their own currencies, digital pseudo-currencies will never gain traction. Bitcoin and its imitators are a zero-sum game in which the sum of all fiat currency paid for it is the sum of all fiat currency received for it, excluding mining costs. The earlier participants are now cashing out the billions that newcomers are putting into this distributed Ponzi scheme. Play it for entertainment value if you want, but remember that you are purely betting on the greater stupidity of others.
SFC fines Rakuten Securities HK Ltd HK$2m
SFC, 13-Dec-2017
For failing to segregate sufficient client money. The company was previously known as FXCM Asia Ltd. This is its second fine in 14 months.
Tai Kam (8321) controller deposits 51% with Astrum Capital Management Ltd
Webb-site.com, 13-Dec-2017
Tai Kam was a bubble stock in what we call the "Enigma Network". The stock is down 97.7% since we published the network chart.
Chairman moves 74.93% of China Graphene (0063) from Zhongtai to ABCI
Webb-site.com, 13-Dec-2017
According to filings, the shares were pledged on 14-Dec-2016 to Zhongtai Dingfeng Classified Fund SP, managed by Zhongtai International Asset Management Ltd. Almost a year later, perhaps they have just been repledged to a different lender. Chairman Li Feng Mao holds the shares via HK Guoxin Investment Group Ltd. ABCI is wholly-owned by Agricultural Bank of China (1288).
Enigma member Jun Yang (0397) terminates Kenny Tang Sing Hing as MD of SFC-licensed subsidiaries
Company announcement, 12-Dec-2017
This is "in light of his unsatisfactory performance that is not aligned with the Group's plans to strengthen and expand the offerings of regulated activities by the Group". But Jun Yang is keeping him as Executive Director and Vice Chairman and as a director of the subsidiaries.
Concentration warning in Satu (8392)
Company announcement, 11-Dec-2017
The top 20 holders have 95.481%.
Chairman Li Xiaoxuan deposits 35.09% of New Higher Edu (2001) with CCB
Webb-site.com, 9-Dec-2017
The stock was listed on 19-Apr-2017 after an IPO at $2.78 per share. If Mr Li has pledged his controlling shareholding within 12 months of the listing then the company would need to announce that.
Court dismisses challenge to SFC's search warrant and provision of information to CSRC
SFC, 8-Dec-2017
We attach the judgment, which provides a rare look inside the Enforcement Division of the SFC and how it investigates cases. Requests from the CSRC involved the first investigation of alleged manipulation under the Stock Connect scheme with Shanghai, for which Mr Tang Hanbo was convicted on the mainland on 2-Mar-2017 and fines totalling RMB1.2bn were imposed. Mr Tang is a HK resident. The SFC had earlier commenced investigations in separate cases in HK, and the search warrant was obtained for those, without mentioning any co-operation with the CSRC.
ICAC response statement
ICAC, 7-Dec-2017
This confirms that the ICAC and the SFC are working together and searched 8 premises. The ICAC has arrested 3 listed company executives for suspected corruption. Comment: these are likely further steps in the investigation of the "Enigma Network" that Webb-site revealed last May.
SFC suspends Town Health (3886)
SEHK, 27-Nov-2017
That's 2 today, and 5 of the 50 stocks in our "Enigma Network" are now suspended by the SFC. Town Health is the biggest yet, with a market cap of HK$5.19bn. It is a member of the Hang Seng Mid-Cap Index.
SFC suspends China Wah Yan Healthcare (0648)
SEHK, 27-Nov-2017
Another member of the Enigma Network. 4 of the 50 stocks have now been suspended by the SFC. This follows First Credit Finance (8215) on 24-Nov-2017, New Ray Medicine (6108) on 6-Oct-2017 and Lerado (1225) on 6-Jun-2017.
Mary Jean Reimer Lau v Ting Wai Monastery Ltd
HK Court of First Instance, 27-Nov-2017
The troubled monastery is ordered to be wound up.
Submission on Capital Raisings by Listed Issuers
Webb-site.com, 24-Nov-2017
Webb-site responds to HKEX's consultation which, while positive, ignores several key issues and does not go far enough in others. Have your say!

Our stories

China Fordoo (2399) controller moves 50.9% from Zhongtai to Donghai
This comes 1 year and 1 day after the block moved from HSBC to Zhongtai. The shares were pledged to Zhongtai, so this suggests that the controller (owned by the Chairman and his wife) may have remortgaged the shares. The SFC issued a concentration warning on the stock on 16-Dec-2016. (14-Dec-2017)
Bitcoin: the World's first decentralised Ponzi scheme
So long as we have governments with the power to tax and spend in their own currencies, digital pseudo-currencies will never gain traction. Bitcoin and its imitators are a zero-sum game in which the sum of all fiat currency paid for it is the sum of all fiat currency received for it, excluding mining costs. The earlier participants are now cashing out the billions that newcomers are putting into this distributed Ponzi scheme. Play it for entertainment value if you want, but remember that you are purely betting on the greater stupidity of others. (14-Dec-2017)
Tai Kam (8321) controller deposits 51% with Astrum Capital Management Ltd
Tai Kam was a bubble stock in what we call the "Enigma Network". The stock is down 97.7% since we published the network chart. (13-Dec-2017)
Chairman moves 74.93% of China Graphene (0063) from Zhongtai to ABCI
According to filings, the shares were pledged on 14-Dec-2016 to Zhongtai Dingfeng Classified Fund SP, managed by Zhongtai International Asset Management Ltd. Almost a year later, perhaps they have just been repledged to a different lender. Chairman Li Feng Mao holds the shares via HK Guoxin Investment Group Ltd. ABCI is wholly-owned by Agricultural Bank of China (1288). (13-Dec-2017)
Chairman Li Xiaoxuan deposits 35.09% of New Higher Edu (2001) with CCB
The stock was listed on 19-Apr-2017 after an IPO at $2.78 per share. If Mr Li has pledged his controlling shareholding within 12 months of the listing then the company would need to announce that. (9-Dec-2017)
Submission on Capital Raisings by Listed Issuers
Webb-site responds to HKEX's consultation which, while positive, ignores several key issues and does not go far enough in others. Have your say! (24-Nov-2017)
If only INEDs were independent
David Webb will be speaking at a conference in HK today. These are his slides, on the most fundamental issue in HK corporate governance. (10-Nov-2017)
The CE's damaging tax proposals: a better approach
The Government proposes distortive gimmicks and loopholes rather than addressing structural issues. Public expenditure has grown faster than GDP, breaching the Basic Law. Revenues have grown even faster, draining capital from the economy. Time to return it. A flat rate of 10% for Profits Tax and Salaries Tax is entirely affordable. What is R&D anyway? New armies of tax consultants and assessors do not make our economy more productive. (24-Oct-2017)

Other news

SFC fines Rakuten Securities HK Ltd HK$2m
SFC, 13-Dec-2017
For failing to segregate sufficient client money. The company was previously known as FXCM Asia Ltd. This is its second fine in 14 months.
Enigma member Jun Yang (0397) terminates Kenny Tang Sing Hing as MD of SFC-licensed subsidiaries
Company announcement, 12-Dec-2017
This is "in light of his unsatisfactory performance that is not aligned with the Group's plans to strengthen and expand the offerings of regulated activities by the Group". But Jun Yang is keeping him as Executive Director and Vice Chairman and as a director of the subsidiaries.
Concentration warning in Satu (8392)
Company announcement, 11-Dec-2017
The top 20 holders have 95.481%.
Court dismisses challenge to SFC's search warrant and provision of information to CSRC
SFC, 8-Dec-2017
We attach the judgment, which provides a rare look inside the Enforcement Division of the SFC and how it investigates cases. Requests from the CSRC involved the first investigation of alleged manipulation under the Stock Connect scheme with Shanghai, for which Mr Tang Hanbo was convicted on the mainland on 2-Mar-2017 and fines totalling RMB1.2bn were imposed. Mr Tang is a HK resident. The SFC had earlier commenced investigations in separate cases in HK, and the search warrant was obtained for those, without mentioning any co-operation with the CSRC.
ICAC response statement
ICAC, 7-Dec-2017
This confirms that the ICAC and the SFC are working together and searched 8 premises. The ICAC has arrested 3 listed company executives for suspected corruption. Comment: these are likely further steps in the investigation of the "Enigma Network" that Webb-site revealed last May.
SFC suspends Town Health (3886)
SEHK, 27-Nov-2017
That's 2 today, and 5 of the 50 stocks in our "Enigma Network" are now suspended by the SFC. Town Health is the biggest yet, with a market cap of HK$5.19bn. It is a member of the Hang Seng Mid-Cap Index.
SFC suspends China Wah Yan Healthcare (0648)
SEHK, 27-Nov-2017
Another member of the Enigma Network. 4 of the 50 stocks have now been suspended by the SFC. This follows First Credit Finance (8215) on 24-Nov-2017, New Ray Medicine (6108) on 6-Oct-2017 and Lerado (1225) on 6-Jun-2017.
Mary Jean Reimer Lau v Ting Wai Monastery Ltd
HK Court of First Instance, 27-Nov-2017
The troubled monastery is ordered to be wound up.
Previously on Webb-site.com
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