Simon Sadler, the founder of Segantii Capital Management Ltd., and former trader Daniel La Rocca are under scrutiny for alleged insider dealing, casting a shadow over one of Hong Kong's prominent financial figures. The Securities and Futures Commission initiated criminal proceedings against them, relating to shares of a locally listed company prior to a 2017 block trade. Both Sadler and La Rocca appeared in Hong Kong's Eastern Magistrates Court, with the case adjourned until June 12. This legal action adds to the regulatory woes of Segantii, once revered as a leading hedge fund firm in Asia. The company played a pivotal role in the regional equity share sale scene, earning accolades for its contributions to challenging deals. In a separate incident in December, South Korean regulators fined Segantii for specific hedging trades. Sadler and La Rocca, released pending the next hearing, provided cash bails of HK$1 million ($128,000) and HK$500,000, respectively. As part of the conditions set by the SFC, they must notify the regulator 24 hours before leaving Hong Kong, furnish complete travel itineraries with contact details, reside at registered addresses, and inform the regulator of any address changes 48 hours in advance. Additionally, they are prohibited from any direct or indirect contact with prosecution witnesses. While specific details regarding the alleged wrongdoing remain undisclosed, Segantii CEO Kurt Ersoy refrained from commenting, and requests for comment from Sadler and La Rocca went unanswered. Sadler, with a background as a trader at Dresdner Kleinwort Wasserstein and Deutsche Bank AG, established Segantii in Hong Kong in late 2007 with initial capital of $26.5 million. Under his stewardship, the firm expanded its footprint to London, New York, and Dubai, focusing on global trading with an emphasis on Asia-Pacific equities and equity-linked securities. As of March, Segantii boasted an impressive 12% annualized return since its inception, outperforming Asia-focused peers. Despite experiencing two moderate annual losses in 2013 and 2023, Segantii's track record made it a sought-after entity in the region, prompting measures to control asset growth. La Rocca, who joined Segantii in 2013, had plans to assume the role of head of Asia-Pacific cash single stocks trading at JPMorgan Chase & Co. His tenure with the firm, apart from a brief stint at Evo Capital Management in 2022, underscores his experience in the industry.