Courage to fight for what is right

SCMP: SFC enforcer still waiting for new contract
2 Sep 2009

As head of the financial regulator's enforcement division, Mark Steward has for the past three years been the driving force behind a crackdown against those involved in illicit deals.

But with less than two weeks left on his contract, there is a deal of his own that remains in doubt. The Securities and Futures Commission executive director is still waiting to find out whether the government will give him a new term.

Last week, Steward raised concerns about his future by revealing he was still in negotiations with the government over a new contract. His current one ends on September 24, and his work visa is also due to expire.

"There is an issue of principle which needs to be ironed out. It is not about money," he said after making a speech at a Hong Kong Securities Institute function on September 3.

His comments, first reported in Ming Pao, have fuelled speculation that the government is under pressure to either replace or clip the wings of the man who is widely credited with the adoption of a hardline approach by the SFC against those who breach market rules.

Steward has recently been at the forefront of a series of high-profile cases. These include a string of insider dealing convictions and jail terms, a legal challenge that scuppered PCCW's privatisation plan on grounds of vote-rigging, and the striking of a deal with banks to get money back for investors in Lehman Brothers minibonds.

Some brokers say Steward may have been too aggressive in his pursuit of market miscreants, leading to complaints about his crusading style. Others say the contract negotiations are over pay, with some suggesting he wants a pay rise. One broker said he had heard that Steward wanted an increase of 25 per cent. Contacted last night, Steward said this suggestion was "completely false".

A spokesman from the Financial Services and the Treasury Bureau said it would not comment on individual appointments. All executive directors of the SFC need to be appointed by the financial secretary.

Steward was praised this week by SFC chief executive Martin Wheatley, who described him as a man with "ability and creative ideas" who had found new ways of using the regulators' powers under the law to crack down on offenders. The latest example was the conviction on Thursday of former Morgan Stanley Asia managing director Du Jun for insider dealing involving HK$87 million.

The legislator for the financial services sector, Chim Pui-chung, said Steward had done a great job so it would be good if he stayed on. "It depends on whether the SFC would fight for a pay rise for him. A pay rise is always an important issue to debate in a contract renewal," Chim said.

Steward's contract is not the only one due to expire. The term of SFC chairman Eddy Fong finishes at the end of this month. Financial Secretary John Tsang Chun-wah has not announced whether he will stay on.