Nine Masts Capital Limited fined $1.2m over naked short selling


The Hong Kong Securities and Futures Commission (SFC) announced that it has fined the company Nine Masts Capital Limited $1.2 million for failures relating to the short selling of Yuzhou Properties Company Limited shares in May 2015.

Back then, on May 12, 2015, Yuzhou Properties proposed placing of new shares, subject to the fulfilment of certain conditions. Yuzhou Properties added after market close on May 21, 2015 that the conditions had been fulfilled and the placing was completed on the same day. Nine Masts was one of the placees in the placement of Yuzhou Properties shares.

The SFC found that Nine Masts sold 10,633,000 Yuzhou Properties shares, right after it has received confirmation from a placing agent that it would be allotted 32 million placing shares of Yuzhou Properties. At the time of placing the sell order, Nine Masts had no existing Yuzhou Properties shares and the placing had not been completed.

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