The Insurance Authority (HKIA) and the Securities and Futures Commission (SFC) have launched a joint investigation into alleged irregularities involving the investment portfolio of Tahoe Life Insurance Company, underscoring their commitment to maintaining the integrity of Hong Kong’s financial markets.
Julia Leung, CEO of the SFC, emphasized the collaborative nature of the probe: “This joint initiative underscores our shared commitment to upholding the integrity of Hong Kong’s financial sector. We aim to ensure that no misconduct jeopardizes investors or falls between regulatory cracks.”
Last week, the HKIA appointed joint and several managers to oversee the affairs and assets of Tahoe Life, a decisive move following extensive investigations over the past four years.
The scrutiny began in May 2020, when the HKIA sought SFC’s assistance to review Tahoe Life’s investments. The SFC’s subsequent inspections of licensed fund managers uncovered that Tahoe Life’s assets were invested in financial instruments associated with a related party in Mainland China.
In June 2021, the SFC, in a landmark operation, conducted a joint investigation with the HKIA into an SFC-licensed fund manager. This operation was the first of its kind since the signing of a Memorandum of Understanding (MoU) between the two regulators in September 2020.
Following the investigation, the SFC imposed disciplinary measures on the implicated fund manager. Both the SFC and the HKIA reaffirm their commitment to promoting a culture of compliance that upholds the highest standards of professionalism and integrity within the financial sector.
Clement Cheung, CEO of the HKIA, expressed gratitude to the SFC for their support during the investigation. “The IA values the SFC’s assistance in addressing issues related to related party transactions at Tahoe Life. This collaboration exemplifies the effectiveness of our MoU in safeguarding policyholders’ interests and reinforcing Hong Kong’s reputation as a leading international financial center.”
