The U.S. Securities and Exchange Commission is investigating Futu Holdings and other cross-border brokers for alleged insider trading. Susquehanna International Group triggered the probe by filing a lawsuit against unknown traders. These individuals reportedly earned over $100 million through illicit options trades.
The suspicious trading occurred immediately before the China Securities Regulatory Commission penalized Futu on May 22. The CSRC issued the penalty for unlicensed operations within mainland China. Susquehanna served as the counterparty for most of these trades and sustained losses exceeding $70 million.
A U.S. federal court has frozen accounts at Futu, Interactive Brokers, and Up Fintech Holding. Susquehanna alleges that Chinese regulatory staff or brokerage employees may have provided non-public information to the traders.