Hong Kong’s Eastern Magistrates’ court on Friday convicted Chan Wing Fai on seven counts of false trading; he has been remanded in jail custody pending sentencing on April 29. This follows a similar case involving the same retail investor five years ago.

Chan faced eight charges of creating a false or misleading appearance with respect to the price of Sonavox International Holdings and Pacmos Technologies Holdings, contrary to section 295 of the Securities and Futures Ordinance. He was acquitted on one of those counts on Friday.

From September 21, 2009 to December 2, 2009, Chan bought single board lots of shares of Sonavox and Pacmos, causing the price of each to increase by as much as 84% and 28%, respectively.

Chan was acquitted in January 2012 and Hong Kong’s Securities and Futures Commission appealed the decision, arguing that the trial magistrate made legal errors. On January 23 this year, the case was remitted back to the magistrate for reconsideration.

The magistrate on Friday took the view that Chan had committed a serious offence, exacerbated by the fact that it was a repeat offence and two of the present offences were committed within the probationary period. He further noted that the last probation order did not seem to be effective, given that Chan had reoffended in the probation period.

Chan had previously been convicted in October 2008 after being found guilty in relation to 12 summonses of creating a false or misleading appearance with respect to the market for shares of Everest International Investments.

The court imposed a 12-month probation order on Chan on condition he receive psychiatric and/or psychological treatment as directed by his probation officer. The court also ordered him to pay investigation costs of HK$13,500 to the SFC.

From July 3, 2007 to October 11, 2007, Chan placed single board lot orders to buy Everest’s shares at prices higher than the then prevailing market prices via the internet before market close. This share trading inflated the share price of Everest by up to 115%.

The SFC alleged that he intended to fix a higher closing price for the shares so that he could sell a larger parcel of them at a higher price on the following day.