August 1, 2014 / 5:25 AM / 3 years ago

Hong Kong securities watchdog to clamp down on 'dark pools'-sources

HONG KONG, Aug 1 (Reuters) - Hong Kong’s securities watchdog has warned banks it will clamp-down on exchange trading platforms known as dark pools in a direct fallout from the Barclays Plc scandal in the United States, people familiar with the matter told Reuters.

The increased regulatory scrutiny by Hong Kong’s Securities and Futures Commission (SFC) could hurt prospects for the nascent dark trading market in the Asian financial center and may trigger similar action by other regulators in the region, the people added.

Banks in Hong Kong have sought legal advice following a confidential meeting convened by the SFC’s supervisory department last month, during which the watchdog told firms it would step-up scrutiny of dark pool marketing materials, one person said.

The SFC declined to comment. Sources also declined to be identified as discussions with regulator were private. (Reporting by Michelle Price; Editing by Denny Thomas and Shri Navaratnam)

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