A former Indian-origin dealer with Credit Suisse Securities has been barred for life from accessing the capital markets by Hong Kong's Securities and Futures Commission for indulging in irregularities related to trading activities.
An SFC investigation found that Jagjit Singh Dhillon, a former trader with Credit Suisse (Hong Kong) and Credit Suisse Securities (Hong Kong), engaged in "improper activities" in two principal trading books to cover up "losses and the real level of risk exposure" between May 8 and May 17, 2012.
Dhillon, who was responsible for trading in equity derivatives, had booked fictitious trades and entered incorrect market data in the trading books, among others.
Banning Dhillon from securities market for life, SFC in its order said: "Dhillon's conduct was deliberate, serious, and showed a lack of honesty we expect from licensed persons, and that he had no personal monetary gain from his conduct".
In various communications between May and June 2012, Credit Suisse had reported to SFC that Dhillon took steps to avoid showing losses attributed to his trading books and the real level of equity market risk exposure.
SFC stated that "to correct such misstatements, Credit Suisse had to make adjustments to reverse out the P&L (Profit & Loss) that was incorrectly reported in his trading books - negative adjustments of USD 5.4 million to the cumulative monthly P&L figures for Dhillon's trading books was made on 18 May 2012".
"As well, Credit Suisse had to re-calculate the equity market risk exposure recorded in its risk management systems to correct an understatement of around USD 40 million of equity market risk in Dhillon's trading books from 11 to 17 May 2012, with the exception of 15 May 2012 when the understatement rose to around USD 77 million," it added.
