Sanction on Hua Nan Securities and Its Employee for Violation of Securities Management-Related Laws and Regulations

1. Date of sanction: August 2, 2023
2. Object of sanction: Hua Nan Securities Co., Ltd. (hereinafter referred to as Hua Nan Securities) and its manager XX Yang.
3. Legal basis for the sanction: Article 56 and sub-paragraph 4, paragraph 1, Article 178-1 at the time of the act of the Securities and Exchange Act, sub-paragraph 9, paragraph 2 and paragraph 3, Article 18 of the Regulations Governing Responsible Persons and Associated Persons of Securities Firms, and paragraph 2, Article 2, paragraph 22, Article 37 and sub-paragraph 4, paragraph 1 and paragraph 2, Article 4 of the Regulations Governing Securities Firms.
4. Facts of violation: 
The Taiwan Stock Exchange Corporation conducted an audit on the Yingge Branch of Hua Nan Securities on December 29, 2022, and found that manager XX Yang of the Branch had lending of funds to customers and accepted customer orders through mobile phones without synchronous recording. The sanctioned party found the aforementioned violations during its inspection, but did not report to the Commission and Hua Nan Securities within five business days from the date of becoming aware or the occurrence of the facts and had the violation of not implementing the internal control system.
5. Sanction imposed: A fine of NT$240,000 is imposed on Hua Nan Securities in accordance with sub-paragraph 4, paragraph 1, Article 178-1 of the Securities and Exchange Act at the time of the act; additionally, Hua Nan Securities is ordered to suspend the business execution by its manager XX Yang for one month.