The Botched Insider Trading of an 80-Year-Old Hong Kong Movie Mogul

@BigCatFinance: The botched insider trading of an 80-year-old Hong Kong movie mogul: he made less than 100,000 and was sentenced to 5 months.

Raymond Wong Pak-Ming is a true heavyweight. In the 1980s, the three giants of Hong Kong cinema were Shaw Brothers, Golden Harvest, and Cinema City. Wong was the founder of Cinema City. Cinema City operated for ten years and dominated for ten years, forcing the other two to huddle together for warmth.

"Aces Go Places", the first film in Hong Kong's cinematic history to break 20 million at the box office;
"Happy Ghost" netted Cinema City a massive 12 million, enough to buy 60 houses in Hong Kong at the time;
"A Better Tomorrow" was a global smash hit; Chow Yun-fat starred in 14 films for Cinema City over 7 years.

Starting with Cinema City, he got a taste of the sweet rewards of capital. Acting and screenwriting were certainly profitable, but his 9% stake also earned him dividends. In terms of status, he was the boss, while Tsui Hark and Eric Tsang were merely "employees."

After Cinema City disbanded, Wong established his own wholly-owned film company, which was even more lucrative. Even the formidable Heung family had to show him some respect.

In film investment, he once held two listed companies with a market value of over a billion, making him a billionaire himself;
In film processing, he held an 80% market share; no matter who shot a film, he could collect a toll;
In film distribution, he had both channels and competitiveness. When "Ne Zha 2" came to Hong Kong, multiple companies vied for this lucrative deal, but Wong ultimately secured it.

At the premiere of "Ne Zha 2", he delivered a speech on stage, enthusiastically talking about "my fate is my own, not heaven's." Then, just a few days later, he was prosecuted.

Why did he fall? It was precisely because of the listed company in his hands.

Pegasus Motion Pictures had produced major blockbusters like the "Ip Man" series, which collectively grossed around 2 billion and revitalized Donnie Yen's career, raising his salary from millions to over a hundred million. However, the company itself wasn't very profitable, losing roughly 100 million a year, so Wong wanted to sell it.

The first party he approached was the A-share company Xinke Materials, which offered 194 million HKD for a 29.9% stake. A materials company crossing over into film is more about hyping concepts than doing real business, and the deal ultimately fell through.

The second party he approached was Zhang Liang, son of R&F Properties boss Zhang Li. At the time, Zhang Liang was essentially a "coal boss" with real money to spend, and the price he offered was nearly 20% above the market rate.

He cashed out 486 million HKD in one go, with almost the entire Wong family sharing the money. What about those who didn't get a cut? They made up for it through insider trading.

However, his methods were simply too crude.

On August 25, 2017, the day he received the acquisition deposit, he wrote a check and sent a message to his sister: "If it's below 0.2 tomorrow, buy as much as you can." This transaction netted Wong's sister an actual profit of 99,000 HKD.

The SFC began investigating in 2025, secured a conviction in May of this year, and sentenced him in June.

Wong first argued that "buy as much as you can" was meant sarcastically, meaning she shouldn't buy. The judge called this "absurd and far-fetched." He then presented various other reasons, such as health issues and philanthropic work, but the judge dismissed them all.

He mobilized his social circle to plead for leniency, gathering over 20 people including TVB executives, renowned directors, and legislators, hoping to spare Wong from prison.

However, the judge ruled that while the method was clumsy, the impact was severe. Avoiding prison was not an option, though the sentence was reduced from 9 months to 5 months.

The prison term is short, but his late-life reputation is ruined.