plaintiff:
  - Securities and Futures Commission

defendant:
  - C.L. Management Services Limited
  - AU Suet-ming, Clarea

case_reason: Eight summonses alleging that the defendants carried on or held themselves out as carrying on a business in advising on corporate finance without a licence, contrary to section 114 of the Securities and Futures Ordinance. The case involved three client companies (3 Wells Group Holdings Limited, UK Fur Limited, and New Bonus Holdings Limited) to whom the defendants allegedly provided unlicensed corporate finance advisory services related to listing on the Stock Exchange of Hong Kong.

judgment_summary: The Eastern Magistrates Court convicted C.L. Management Services Limited (D1) of three summonses (ESS 39231/2013, 30673/2013, and 30675/2013) concerning "holding-out" offences under section 114(1)(b) of the Securities and Futures Ordinance, and convicted AU Suet-ming, Clarea (D2) of three corresponding attributable offences under section 390. The court imposed fines totaling $900,000 on D1 and $600,000 on D2, and sentenced D2 to 6 months imprisonment suspended for 18 months. The judgment addressed key legal issues including whether the offences were strict liability offences, the meaning of "without reasonable excuse", and whether D1 could be liable for acts of D2's agent Michael ANG. The court held that the presumption of mens rea should be displaced for section 114(1) offences, that "without reasonable excuse" is an element of the offence that the prosecution must prove, and that the offences fall within the third alternative of intermediate liability requiring proof of absence of due diligence or honest and reasonable belief.

jurisdiction_code: HKMAGC

jurisdiction_name: Eastern Magistrates Court of the Hong Kong Special Administrative Region

case_location: Hong Kong Special Administrative Region

case_object:
  - Unlicensed carrying on of regulated activity (advising on corporate finance)
  - Holding out as carrying on regulated activity without licence
  - Corporate officer liability for company offences
  - Strict liability offences under Securities and Futures Ordinance

judgment_result:
  - charge: ESS 39231/2013 - Holding out to 3 Wells Group Holdings Limited as carrying on business in advising on corporate finance (D1)
    result: Convicted
  - charge: ESS 30673/2013 - Holding out to UK Fur Limited as carrying on business in advising on corporate finance (D1)
    result: Convicted
  - charge: ESS 30675/2013 - Holding out to New Bonus Holdings Limited as carrying on business in advising on corporate finance (D1)
    result: Convicted
  - charge: ESS 39232/2013 - Attributable offence as officer of D1 (D2)
    result: Convicted
  - charge: ESS 30674/2013 - Attributable offence as officer of D1 (D2)
    result: Convicted
  - charge: ESS 30676/2013 - Attributable offence as officer of D1 (D2)
    result: Convicted

involved_entities:
  - entity_name: June Cheung
    reason: Magistrate who presided over the trial and delivered the verdict and statement of findings
  - entity_name: Michael ANG
    reason: Agent engaged by D2 to deal with client companies; was called as prosecution witness but declined to give evidence citing self-incrimination concerns
  - entity_name: 3 Wells Group Holdings Limited
    reason: Client company that entered into Professional Financial Consultation Services Agreement with D1 for listing on GEM Board; paid HK$300,000 to D1
  - entity_name: UK Fur Limited
    reason: Client company that entered into Professional Financial Consultation Services Agreement with D1; paid HK$600,000 and granted 14,400,000 option shares to D1
  - entity_name: New Bonus Holdings Limited
    reason: Client company that entered into Professional Financial Consultation Services Agreement with D1; paid HK$170,000 to D1
  - entity_name: Clement CHEUK
    reason: Chairman of 3 Wells Group Holdings Limited; testified as prosecution witness (PW1)
  - entity_name: Phoebe Lee
    reason: Chief Financial Officer of 3 Wells Group Holdings Limited; testified as prosecution witness (PW2)
  - entity_name: Pat WONG
    reason: Chairman of UK Fur Limited; testified as prosecution witness (PW3)
  - entity_name: WONG Kam-fai
    reason: Chairman of New Bonus Holdings Limited; testified as prosecution witness (PW4)
  - entity_name: Stock Exchange of Hong Kong Limited
    reason: The stock exchange where the client companies sought to be listed on the Growth Enterprise Market (GEM) Board
  - entity_name: Securities and Futures Ordinance
    reason: The legislation under which the offences were charged, specifically sections 114 and 390
