MAS obtains civil penalty judgment against two individuals for unauthorised share trading

The Monetary Authority of Singapore (MAS) has successfully obtained a civil penalty judgment against Wang Boon Heng and Foo Jee Chin for contravening rules under the Securities and Futures Act (SFA), which prohibit fraud or deception in share trading.

This case was referred to MAS by the Singapore Exchange. When the act was committed, Wang and Foo were divorced, and Wang was an undischarged bankrupt.

Between Sept 3, 2007 and Dec 27, 2007, Wang carried out share trading for his own benefit in the accounts opened in Foo's name with DMG & Partners and UOB Kay Hian.

Between Sept 19, 2007 and Dec 28, 2007, Wang did the same thing in accounts opened in the name of another person with DMG and UOBKH.

The brokerages did not know that the trades in the accounts were carried out for Wang's benefit, and not for the benefit of the named account holders.

Both brokerages did not authorise nor give consent to Wang to trade in the accounts for himself.

MAS said: "In doing so, Wang had intentionally deceived DMG and UOBKH. By allowing Wang to trade in her DMG and UOBKH accounts without obtaining the authorisation and/or consent of DMG and UOBKH, Foo had also intentionally deceived DMG and UOBKH."

In 2013, MAS commenced a civil penalty action against Wang and Foo for contravening section 201(b) of the SFA.

Last December, the Court ruled that Wang and Foo had contravened the section and on Wednesday, the Court further ordered that Wang and Foo pay a civil penalty of S$75,000 and S$50,000 respectively, as well as S$58,636.23 for the legal costs and disbursements incurred by MAS for the civil penalty action.

MAS also issued a warning letter to the second account holder for contravening rules for allowing Wang to trade in his accounts for the latter's benefit.

Lee Boon Ngiap, assistant managing director (capital markets) at MAS, said: "This civil penalty action reflects MAS' firm stance against unauthorised share trading, which is a deception against broking firms that are unaware of the beneficial owner behind the trades.

"Such behaviours carry regulatory risks as perpetrators of insider trading and market manipulation often hide behind nominee accounts."