Sunday, 22 July 2012

KL 'heavyweight' charged with insider trading (2)

Article in The Sunday Times (Singapore) "KL charges top lawyer with insider trading".

"Sreesanthan is only the second person to be charged with insider trading by the Securities Commission.

In 1996, the commission had pressed criminal charges against Kim Hin Industry managing director Chua Seng Huat for allegedly using confidential information to sell company shares and gain profits for its holding company.

But the Kuching Sessions Court later acquitted him in the grounds that the prosecution had failed to prove beyond reasonable doubt that he had the relevant information at the time."

I find this rather shocking news, even in the one year existence of this blog I wrote about several cases of possible insider trading. Many more can be found in other blogs like Where Is Ze Moola. The number of cases where a juicy announcement is preceded by a significant rise in both price and volume is huge.

And before this recent case the SC only charged one person so far, 16 years ago, and even in that case the person was acquitted.

More information in this article in The Star.

The investigation has taken some time and expenses,” said Rosmawar (SC prosecutor DPP), adding it was a serious offence.

"Some time", that sounds like a huge understatement, the first alleged offence happened six years ago!

Some more specifics:

"Under the first three charges, Sreesanthan is alleged to have acquired 75,000 units of Sime Darby Berhad shares while in possession of insider information on the proposed acquisition of several real estate and plantation companies by Synergy Drive Sdn Bhd between Oct 9 and Nov 12, 2006.

For the next two charges, he is accused of insider information involving 250,000 units of Maxis Communication Bhd shares on the proposed conditional take-over by Binariang GSM Sdn Bhd to acquire all the voting shares in Maxis and Maxis' proposed privatisation between April 25 and 27, 2007.

Under the sixth and seventh charges, he is accused of buying 200,000 units of UEM World Berhad and 100,000 units of VADS Berhad shares while in possession of insider information on Feb 13 and Sept 18, 2008, respectively."

Another article in The Star.

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