Bank of America Tightened Block Trade Rules After Esprit Deal at Center of Hong Kong Criminal Trial

Bank of America Corp. adopted new block-trade guidelines months after a share transaction became the focal point of an ongoing criminal trial in Hong Kong, a court heard Monday. The timing of the policy shift raises questions about what the bank knew about the Esprit Holdings deal and when it knew it.

The revised protocols followed a transaction involving Esprit shares that is now at the center of criminal proceedings against a prominent hedge fund. The case has drawn attention to how major banks handle large block trades and the internal controls meant to prevent market manipulation or other misconduct. Court testimony revealed that Bank of America implemented tighter rules on similar transactions after the Esprit deal closed, but before the criminal allegations became public.

The trial has put pressure on the bank's risk management practices under scrutiny from regulators and prosecutors. If authorities determine that Bank of America's controls were insufficient or that employees had knowledge of potentially problematic activity, the institution could face regulatory consequences or reputational damage. The case signals heightened vigilance among financial institutions operating in markets with robust enforcement regimes, where block trades involving illiquid positions continue to attract criminal and civil scrutiny.