The Hong Kong Securities and Futures Commission's crackdown on account opening loopholes has named 12 brokerages, and the mainland investors' channels are about to be tightened.

The Securities and Futures Commission (SFC) of Hong Kong issued a circular today outlining the monitoring measures to be implemented when opening accounts and maintaining client relationships.
This circular was issued after the SFC reviewed the account opening procedures of 12 securities brokerage firms, identifying several significant deficiencies, including inadequate due diligence on account opening documents, acceptance of suspicious or forged documents, and weaknesses in managing cross-border agency relationships with overseas intermediaries.
The SFC expressed serious concern over the potential misuse of client accounts for suspicious or illegal transactions, as well as the increased risks of money laundering and terrorist financing.
The SFC requires all licensed corporations to promptly conduct internal reviews as soon as practicable to detect whether any suspicious or forged documents have been accepted for account opening, and lists additional measures for opening and managing accounts for mainland investors.