Brokers can play a role in tracking engineered trading volumes in market

IN an interview published in The Business Times this week, the chief regulatory officer of the Singapore Exchange (SGX) Tan Boon Gin made it clear that from the exchange's perspective as a frontline regulator, prevention is better than cure, so its preferred approach is to nip problems in the bud.

Thus, in its efforts to intervene as early as possible when it detects possible wrongdoing, SGX has in the past nine months sharpened the focus of its Trade with Caution (TWC) warnings to include more information hinting at the existence of false markets.

For example, in its first TWC this year, it noted that shares of engineering firm Koyo International had remained steady and had even risen during a period spanning several weeks while the broad market declined, and that a small group of individuals was responsible for most of the volume as well as buying and selling among themselves.