HK court orders hedge fund Tiger Asia to pay investors HK$45 mln

HONG KONG Fri Dec 20, 2013 6:37am EST

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HONG KONG (Reuters) - A Hong Kong court has ordered hedge fund Tiger Asia Management LLC, founder Bill Sung Kook Hwang and head trader Raymond Park to pay HK$45 million to around 1,800 investors affected by insider trading involving two stocks.

The ruling is the second this month in cases brought by the Securities and Futures Commission SFC.L forcing an individual or firm to pay investors money they lost out on because of insider trading.

Tiger Asia had admitted engaging in insider trading in 2008 and 2009 in the Hong Kong-listed stocks of China Construction Bank Corp CCB.L (0939.HK) (601939.SS) and Bank of China Ltd BOC.L (3988.HK) (601988.SS).

"The restoration amount represents the difference between the actual price of BOC and CCB shares sold by Tiger Asia and the value of those shares taking into account the inside information known to Tiger Asia," the SFC said in a statement on Friday.

In December last year, Tiger Asia admitted to charges of wire fraud, brought by the U.S. Securities and Exchange Commission (SEC), in connection with the trades in the Chinese bank shares that the SFC alleged were illegal.

The SEC also charged head trader Park with insider trading. Park and fund founder Hwang agreed to settle the SEC's charges without admitting or denying them.

Tiger Asia in August last year said it would return money entrusted to it by investors by the end that month as the SFC investigation in Hong Kong was likely to be prolonged.

Earlier this month, a former Morgan Stanley (MS.N) banker convicted of insider trading was ordered to pay more than 290 investors a total of HK$23.9 million.

(Reporting by Nishant Kumar; Editing by Christopher Cushing)

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