Trader used $50m to open leverage for stock trading, firm faces $150m loss

A 26-year-old trader arrested for allegedly misusing company funds at a securities firm in Central's World-Wide House had taken HK$50 million from his firm as margin and used it to open leveraged positions "several times" the amount, resulting in a temporary loss of about HK$150 million, according to police and sources.

The man, surnamed Yuen, allegedly misappropriated the funds between January 9 and July 20 without authorisation, using the money as collateral to raise hundreds of millions of dollars to trade stocks on behalf of the company, sources said.

The fraud was discovered during a recent audit. The company is still holding the stocks and has not sold them, meaning the actual loss may change as prices continue to fluctuate. With current stock prices, the temporary loss is estimated at about HK$150 million, but the final figure remains to be determined.

Police received a report from a female employee at the firm on Des Voeux Road Central on Monday evening and arrested Yuen on suspicion of theft. He is being detained for investigation. The case is being handled by the Central district regional crime unit.

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