Market Turnover


Exchange’s Disciplinary Action against China Ecotourism Group Limited (Stock Code: 1371) and Seven Directors

25 Apr 2024

(A wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited)


The Stock Exchange of Hong Kong Limited


(1) China Ecotourism Group Limited (formerly known as China LotSynergy Holdings Limited) (Stock Code: 1371);


(2) Mr Wu Jing Wei, executive director;

(3) Ms Chan Tan Na Donna, former executive director, chairman and chief executive officer;

(4) Ms Lau Ting, former executive director;


(5) Mr Li Zi Kui, former executive director;

(6) Mr Chan Ming Fai, independent non-executive director;

(7) Mr Cui Shu Ming, former independent non-executive director; and

(8) Mr Huang Sheng Lan, former independent non-executive director.


the Company to conduct an independent internal control review, and each of Mr Li, Mr Chan and Mr Cui to attend training.

The statement made in respect of each of Mr Wu, Ms Chan and Ms Lau is made in addition to a public censure against each of them. The Prejudice to Investors’ Interests Statement is a statement that, in the Exchange’s opinion, the retention of office by Ms Chan and Ms Lau would have been, and by Mr Wu is, prejudicial to the interests of investors.

This disciplinary action demonstrates the concerted effort of Hong Kong regulators to curb problematic lending transactions and to improve listed issuers’ governance over material loans.


The Exchange’s investigation revealed that, between 2014 and 2018, the Company’s group entered into loans and a subscription agreement involving significant outflows of monies from the group. The then executive directors, Mr Wu Jing Wei, Ms Chan Tan Na Donna and/or Ms Lau Ting, were involved in the approval of those transactions.

With the assistance of the Securities and Futures Commission (SFC), evidence was obtained showing that parts of the loan proceeds were transferred to individuals and/or entities related to Ms Chan and Ms Lau, and part of the subscription money for the investment was transferred to the personal account of Ms Chan’s husband. These fund flows raised concerns as to whether there were some other arrangements involving the relevant directors and borrowers.


  • The loans were purportedly granted with a view to the development of the Company’s lottery business in China and in the Philippines. However, there was no evidence that the loan proceeds were used for this purpose, and all the borrowers defaulted.
  • The investment was intended to be for shares in a company owned by a Ms Kang to facilitate adoption of blockchain technology in the lottery business. The subscription monies were not paid to the vendor, but to a third party at the instruction of Ms Kang. No shares were delivered, and Ms Kang then became uncontactable.

The loans and investment were entered into without sufficient due diligence, risk analysis or credit assessment. They were prejudicial to the Company’s interest and put the Company’s assets in jeopardy. For the financial years ended 2018 and 2019, the Company respectively recognised HK$66.1 million and HK$407 million impairment loss on the loan receivables, and fully impaired the HK$35 million investment.

Between 2014 and 2017, the board repeatedly represented to the Company’s auditors that the loans were fully recoverable, and that no impairment was required, even when borrowers had defaulted on repayments and, in some cases, contact with the borrowers had been lost. There was insufficient scrutiny of these representations, including by Mr Huang, Mr Chan and Mr Cui, who were members of the audit committee and should have questioned the representations to ensure the integrity of the Company’s financial statements.

All the directors were aware of the Company’s practice of granting loans to procure business opportunities but they failed to ensure that the Company established and maintained an adequate internal controls and risk management system. Material lending transactions have formed part of the Exchange’s thematic reviews over the last three years. Proper directors’ oversight and effective internal controls over listed issuers’ lending businesses are essential to safeguard shareholders’ interests.

HKEX’s Head of Enforcement, Jon Witts, said: “The Exchange welcomes the SFC’s support on our continued collaboration and efforts to combat financial misconduct. Together, our aim is to preserve market integrity and protect investors’ interests by identifying and censuring offenders.”

Key messages:

Directors of listed companies have a duty to safeguard the company’s interests and assets. They should conduct proper due diligence and risk assessment prior to granting loans.

Directors, particularly the audit committee, should closely scrutinise the management representations made to the auditors. They should apply a questioning mind, and exercise independent judgement.  

A copy of the Statement of Disciplinary Action is available on the HKEX website.