HONG KONG : An insider trading case against Asian hedge fund Segantii Capital Management, its high-profile British founder Simon Sadler and a former trader has been moved to a higher court in Hong Kong, a local court ruled on Wednesday.
The Eastern Magistrates’ Court approved the prosecution’s request to transfer the case to a district court. The next hearing is scheduled to take place at the district court on July 2, the court ruled without providing reasons.
The maximum prison term a district court judge can impose is seven years, versus two to three years for the magistrate’s court.
The case marks a turning point for one of Asia’s biggest and oldest hedge funds, which has said it will refund investors, and a step toward heightened scrutiny of trading activities in the region.
The Hong Kong Securities and Futures Commission said last month it had started criminal proceedings against Segantii, its founder and chief investment officer Sadler and former trader Daniel La Rocca on suspicion of insider dealing in the shares of a Hong Kong-listed company before a block trade in June 2017.
Sadler, dubbed Asia’s “block trade king”, is also the owner of his hometown soccer team, Blackpool Football Club.
Sadler, La Rocca and Segantii CEO Kurt Ersoy declined to comment on the charges on Wednesday outside a court hearing room. The company said last month it planned to “defend itself vigorously against the charges”.
Segantii was established in 2007. Its flagship Asia-Pacific Equity Multi-Strategy Fund was up 2.5 per cent in the first quarter, after a 1.6 per cent decline in 2023, according to a source who received data on the fund’s performance.
The fund managed about $4.8 billion at the end of March, according to a monthly letter from the fund seen by Reuters.