The proposed extradition bill has made headlines worldwide this week, and Hong Kong’s private wealth management industry is worried investors might begin to shift their assets elsewhere amid the turmoil, sources told Asian Private Banker.

According to the proposed amendments to Hong Kong’s Fugitive Offenders Ordinance, the city’s chief executive, Carrie Lam, would be imbued with the authority to transfer fugitives to jurisdictions with which Hong Kong lacks a formal treaty — including Macau, Taiwan, and Mainland China. If approved, Hong Kong’s courts would not have the power to question the “quality of justice” the accused would receive.

Over the course of this week, multiple media sources have spoken to financial industry practitioners, some of whom have voiced concerns over being extradited based on past criticisms they shared, while others worry the extradition bill could affect Hong Kong’s rights and freedoms — key elements of an international financial hub.

For instance, Gillem Tulloch, founder of accounting research firm GMT Research, told Bloomberg on Wednesday that he may move the firm to Singapore or the UK as the firm’s critical research — particularly relating to Chinese companies listed in Hong Kong — makes it vulnerable to false allegations that could be used as a pretext for extradition.

“It is just naive to have an extradition treaty,” Tulloch said, adding that the proposed bill “is against the best interests of Hong Kong”.

While the majority of banks and asset managers in the city declined to comment when Asian Private Banker reached out, Paul McSheaffrey, head of banking and capital markets, Hong Kong at KPMG China, told reporters during a media conference on Thursday that it’s “too early” for the firm to respond.

“Some Mainland HNW clients have moved their private banking assets from Hong Kong to Singapore and it’s hard to distil that into one factor,” McSheaffrey added.

And although other consultancies and banks did not provide extradition-related comments on record, there is a palpable sense amongst industry professionals that Hong Kong could lose its status as a “special region”.

“Hedge fund companies in Hong Kong are more concerned as investment decisions such as the selling off of A-shares would be considered as being non-patriotic,” a partner from an international law firm told Asian Private Banker on the condition of “strict anonymity”.

“Some of them are opening Singapore offices as a ‘second home’ while keeping the operation of the Hong Kong office. The transfer of assets is likely gradual for most, but there are assets moving out of Hong Kong.”

The source added that some investors, rather than move assets out of Hong Kong, are seeking alternative safety nets, such as shifting assets from Chinese banks to securities firms where asset-owner identification is less straightforward.

“Some investors still believe it is better to park assets in Hong Kong rather than in Singapore due to geographical proximity,” they said.

“If this extradition bill passes, it would not only harm Hong Kong as a private wealth management hub as the industry association envisioned, but it is a huge blow to Hong Kong’s status as a leading international financial centre.”