Segantii Capital Management returns funds to investors amid SFC prosecution

The Hong Kong hedge fund has taken the difficult decision after 16 years of trading, as the SFC prosecutes the firm, chief investment officer Simon Sandler, and a former trader, for insider trading.

Hong Kong-headquartered hedge fund Segantii Capital Management is returning money to investors this week.

The decision has been made after, on May 2, Hong Kong's Securities and Futures Commission (SFC) started criminal proceedings against Hong Kong-based hedge fund Segantii Capital Management, its director and chief investment officer Simon Sadler, and former trader Daniel La Rocca, for insider dealing in the shares of a company listed on the Hong Kong Stock Exchange (HKEX) prior to a block trade in June 2017. The name of the company was not identified by the SFC. 

No plea was taken when the defendants appeared at the Eastern Magistrates’ Court on May 2, and the case was adjourned to June 12, 2024, the SFC said in a statement. A spokesperson for Segantii told FinanceAsia that it "intends to defend itself vigorously against the charge". 

However, the hedge fund, which also has offices in Dubai, London and New York, has decided to return its investor capital amid reports that many investors had been making withdrawals. As of March 31, 2024 it had $4.8 billion under assets, according to its website.

A spokesperson for Segantii Capital Management told FinanceAsia: “We have always believed at Segantii that it is a great responsibility and privilege to professionally manage money and we have never taken that lightly. We have decided, however, that at this time, it is in the best interests of our investors to return their capital in an orderly manner.”

The spokesperson added: “We would like to thank all investors, past and present, for the trust that they have placed in us over the last 16 years.”

The move will also impact banks that did business on behalf of Segantii. 

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