US SEC charges Future FinTech CEO with fraud, disclosure failures (updated)
11/01/2024 22:34
(Updates with background, details in paragraphs 3-5)
WASHINGTON, Jan 11 (Reuters) - The U.S. Securities and
Exchange Commission on Thursday charged the CEO of Future
FinTech Group FTFT.O with fraud and disclosure failures for
allegedly manipulatively trading in the financial services
firm's stock prior to becoming its chief.
The regulator said in a statement that Future FinTech's
Shanchun Huang used an offshore account to trade shares shortly
before he becoming CEO in 2020. The SEC also said it charged
Huang with failing to disclose his beneficial ownership of
Future FinTech stock as well as transactions in such stock.
A lawyer for Huang did not respond immediately to a request
for comment.
According to the SEC, Huang began to trade shares of
FinTech Group's stock beginning in January 2020 after being
approached to become the firm's CEO. His trades, which made up a
high percentage of daily trading volume, including placing
multiple buy orders and other activity intended to boost prices,
the SEC said.
The trades came at a time when Future FinTech was at
risk of being kicked off the Nasdaq because its share price had
fallen below the exchange's minimum bid price requirement of $1
a share, regulators said.
Future FinTech's shares were down 20%, hovering near $1,
in after hours trading on Thursday.
(Reporting by Kanishka Singh in Washington and Chris Prentice
in New York, editing by Deepa Babington)
((Kanishka.Singh@thomsonreuters.com; +12024508248;))