Frederick Ma bowed low yesterday as he publicly admitted
guilt in the penny stocks fiasco, a day after refusing to apologise
when his name appeared in a damning government report.
The Secretary for Financial Services and the Treasury appeared at what
looked like a hastily arranged media briefing at government
headquarters just 90 minutes after the typhoon signal No 8 was
"Since the penny stocks matter happened, I have been very distressed
and self-critical. As I said in [Tuesday's] press conference, I truly
accept, and I say it again, I truly accept, criticisms in the report
and from the public."
The report said Ma's "lack of close geographical connection" with
his staff helped prevent him seeing the Securities and Futures
Commission summary of the proposed mechanism to delist low-performance
stocks before the proposals were made public in July.
The report also said his performance under questioning by legislators
"Although the report did not say I was negligent, the unfortunate
matter did happen under my jurisdiction. As well as this, my
performance at the Legislative Council was not good and I know that
many investors were affected, stirring up echoes and concerns in the
society. I therefore feel like expressing my deep regret," Ma said
yesterday. "I also want to officially and sincerely apologise to the
public," he said, bowing low.
"I want to reiterate to the people that I will learn a lesson from
what happened and that I will do my job better in future."
Ma, who according to Chief Executive Tung Chee-hwa on Tuesday had
promised to be more humble in future, left without answering any
The report by lawyer Robert Kotewall and company director Gordon
Kwong, released on Tuesday, found individual errors by key figures
involved including Ma, Financial Secretary Antony Leung, Securities
and Futures Commission chairman Andrew Sheng and Hong Exchanges and
Clearing chief executive Kwong Ki-chi. But it held no one specifically
to blame for the fiasco, in which investors, spooked by the delisting
proposals, dumped penny stocks in a sell-off that wiped HK$10.91
billion off Hong Kong shares on July 26.
Kwong, the only other central figure to comment yesterday, ducked
questions on whether he should be held responsible.
Speaking after an HKEx board meeting to discuss the inquiry report, he
said only: "Justice will prevail in the hearts of the people."
He said the board had accepted the report's recommendations in
principle, "but we have to consult all the board members and the
listing committee before implementation".
The probe found Kwong, the chief at the lowest level of the
three-tiered regulatory framework, guilty of administrative mistakes
and said he "should be held responsible on behalf of the HKEx for any
major policy shortcomings in the preparation and release of the
Exchange director Lo Ka-shui said the board had not spoken about who
should be held responsible, or about the renewal of Kwong's contract.
"The Exchanges and Clearing and the Securities and Futures Commission
could both do better in consulting the industry and with
inter-communication," Lo said.
HKEx released a paper on July 25 on its proposed delisting criteria,
one of which affected stocks whose price fell below 50 HK cents. The
paper was shelved three days later. Officials had since said that
investors mistook the proposals for firm policy.
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