backed brokerage for wash trade controls failures

Bright Smart Securities & Commodities

27/07/2026 10:17

July 27 (Reuters) - The Securities and Futures Commission (SFC) said on Monday that it had reprimanded and fined Bright Smart Securities International (H.K.) HK$2.8 million ($357,056.33) for internal control failures that allowed wash trades to be executed.

Here are the details:
The SFC said in a statement that the brokerage, a part of the larger Bright Smart Securities & Commodities Group 1428.HK in which Ant Group holds a controlling stake, failed to implement "adequate and effective" internal control procedures to monitor and detect wash trades.
Wash trading is a form of market manipulation in which the same trader or related parties simultaneously buy and sell a security to create a false impression of trading volume and market activity.
The markets regulator said its investigation revealed that between November 1, 2023 and September 13, 2025, the brokerage allowed execution of 1,021 pairs of wash trades involving 736 stocks and warrants through 615 clients’ accounts due to inadequate controls.
Moreover, the SFC found that the company relied mainly on post-trade monitoring and manual review to identify suspicious trades prior to March 2024, allowing clients to conduct wash trades before detection.
The SFC also said that the brokerage has taken steps to enhance systems and controls to prevent future breaches and had undertaken to engage an independent reviewer to check the new measures. 
Ant Group bought a controlling stake in Bright Smart Securities & Commodities Group 1428.HKfor HK$2.81 billion earlier this year.


($1 = 7.8419 Hong Kong dollars)

 (Reporting by Nichiket Sunil in Bengaluru; Editing by Ronojoy Mazumdar)
 ((Nichiket.Sunil@thomsonreuters.com;))