Monday’s hearing on whether a US fund manager should be banned from the Hong Kong markets for selling shares worth just HK$2m ($258,000) is part of a growing effort by the local market regulator to crack down on misbehaviour by overseas traders.

Increasingly, the Securities and Futures Commission is looking to wield a very big stick over bad behaviour within its realm precisely because so many of the actors it wants to influence are out of its reach. More than any jurisdiction other than perhaps Singapore, Hong Kong is a market where most interactions are between companies and investors who are located elsewhere.

This is not only an issue for the enforcement division, led by Mark Steward, which has recently investigated the US fund manager, George Stairs of Fidelity, and Tiger Asia, a US-based hedge fund. It is also seen in the SFC’s recent proposals to make sponsors of initial public offerings criminally liable for bad deals.