Enigma crash spurs Hong Kong raid

Gulf News - - BUSINESS -

The largest ever raid by Hong Kong’s se­cu­ri­ties reg­u­la­tor was linked to the multi-bil­lion dol­lar plunge in nearly three dozen small-cap stocks in June, ac­cord­ing to a per­son fa­mil­iar with the sit­u­a­tion.

One hun­dred and thirty-six agents from the city’s Se­cu­ri­ties and Fu­tures Com­mis­sion re­cently searched mul­ti­ple premises, head of en­force­ment Tom Atkin­son said in a speech on Wed­nes­day, with­out dis­clos­ing what trig­gered the raid.

The search was re­lated to the so-called Enigma Net­work, the per­son fa­mil­iar said, a group of com­pa­nies whose over­lap­ping own­er­ship ties and bub­ble-like qual­i­ties were pub­li­cised by ac­tivist in­vestor David Webb in May. The stocks gained wide­spread at­ten­tion in Hong Kong af­ter many of them sud­denly plunged by as much as 90 per cent on June 27.

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