NEW CASTLE • New Castle Gold Limited

The Chinese Gold & Sliver Exchange Society

The Hong Kong Bullion Trade Fair is only an industry association, not a government regulatory agency, and it does not have any regulatory authority. The members of the board of directors and supervisors of the trade fair are all heads of various gold companies. They are both athletes and referees. They cannot guarantee the fairness and transparency of supervision. The Hong Kong Securities Regulatory Commission stipulates that financial investment can only be leveraged up to 20 times, but the gold margin companies in the Hong Kong Bullion Trade Fair are basically 100 times leveraged, which greatly exceeds the Hong Kong Securities Regulatory Commission's regulations. Many Hong Kong gold trading companies use personal intermediary banks to receive remittances, and can use third-party remittances, completely failing to comply with international regulations on money laundering and financial risk control. The Hong Kong gold and silver trade fair has neither pre-warning nor post-treatment for the illegal activities of Zhongtian, Hengxin and other companies. Instead, it only issues announcements to clarify the relationship and shirk responsibility.