According to court documents, a suit by Hong Kong’s securities regulator, Securities & Futures Commission of Hong Kong (SFC), was filed against Standard Chartered, UBS AG and four other parties over the 2009 IPO of timber company China Forestry Holdings Co Ltd.
Due to “market misconduct” over the IPO prospectus of China Forestry filed in November 2009, company’s 2009 annual report. 2009 annual results and results for the first six months of 2010, the securities regulator is currently seeking damages with an unspecified amount.
China Forestry’s two co-founders, Li Kwok Cheong and Li Han Chun, as well as KPMG, the company’s auditor, were also being sued by SFC.
Currently, the parties have 14 days to respond to SFC’s suit.
Standard Chartered and UBS have separately disclosed that SFC was probing their role as sponsors of an unnamed IPO and that the suit may result in financial consequences.
In the 2009 IPO, China Forestry raised US$216million, but its shares have been suspended since January 2011. The company is now in liquidation and is in the process of getting delisted after the company’s auditor said it found possible accounting irregularities.