Hong Kong Exchanges and Clearing's (HKG:0388) FINI digital initial public offering settlement platform failed to flag multiple IPO subscriptions by users in China, The Standard reported Tuesday, citing local media.
Some mainland China were suspected of repeatedly applying for popular IPOs using multiple identification cards through multiple brokerage accounts, the report said.
A reporter from a Chinese newspaper tested the loophole and was able to avoid duplicate alerts despite opening accounts at two brokerages using both Hong Kong and mainland China IDs to submit IPO applications for Chifeng Jilong Gold Mining (HKG:6693, SHA:600988), the news outlet reported.
The development came after new listings in the city recorded substantial oversubscriptions, the report said.
Hong Kong's Securities and Futures Commission said brokerages are responsible for imposing FINI regulations, the report said.
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