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Personal relationships taking a higher priority
Raymond is a fund manager who manages the provident funds in a medium-sized asset management company. His wife, Jenny, is an account executive in a brokerage firm. Recently, Jenny has been under pressure from her employer to generate more business. Due to the keen competition within the industry, she is unable to meet the quota for finding new clients. In order to help his wife, Raymond makes use of his official position to place business with her without observing his company policy on the selection of external brokers.
Case Analysis
Being a fund manager, Raymond violates the *Codes of Conduct as he places personal relationships as his priority for allocating business with an external broker. The Fund Manager Code of Conduct stipulates that a fund manager should not carry out any transaction on behalf of a client with a company which is a connected person unless such transaction is carried out on arm’s length terms. To protect the interests of clients, service quality should be taken as the top priority in the selection of external brokers. Even when Raymond is confident that the service provided by Jenny’s company is as good as those of other brokers, he should disclose the interests to his employer.
*Remarks: Codes of Conduct refer to the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission, the Code of Conduct for Corporate Finance Adviser and the Fund Manager Code of Conduct.