1. Bursa Securities has issued a reprimand to Pneh Tee Eong, a Commissioned Dealer’s Representative (“CDR”) of M&A Securities Sdn Bhd (“M&A”), fined him RM100,000 and has further ordered that he be struck off from the Register with immediate effect for the breach of Rules 404.3(1)(a) & (b) and 401.1(2) & (3) of the Rules of Bursa Securities.
2. Rules 404.3(1)(a) & (b) and 401.1(2) & (3) of the Rules of Bursa Securities state, amongst others, that Dealer’s Representatives (“DRs”) shall :-
- at all times observe professional standards of integrity and fair dealing; and act honestly and in the best interest of their clients;
- in the conduct of their business for the sale, disposal, purchase, acquisition or exchange of securities, refrain themselves from engaging in, or be a party to any unethical practices that may damage the confidence of investors and hamper the sound development of the stock market; and
- avoid any act or practice which might lead to a false or misleading appearance of active trading in any securities on the stock market of the Exchange or a false or misleading appearance with respect to the market for, or the price of, any such securities; or directly or indirectly be tantamount to stock market manipulations, and shall not participate in any operation by others which might have the same result.
3. Arising from the investigations conducted on the trading activities in ASIAEP Berhad (“ASIAEP”) shares from 3 January 2007 to 4 July 2007 (“the Relevant Period”), Bursa Securities found that Pneh Tee Eong had, whilst being a CDR of M&A at its Kuala Lumpur Branch Office, acted in violation of Rules 404.3(1)(a) & (b) and 401.1(2) & (3) of the Rules of Bursa Securities (“the Breach”) for engaging in manipulative trading activities in ASIAEP shares.
During the Relevant Period, Pneh Tee Eong had executed trades in ASIAEP shares in more than 10 clients’ (“the Clients”) accounts, which constituted more than 35% of the total trades of ASIAEP shares. He had subsequently increased his domination of the trades in ASIAEP share to more than 60% of the total trades done.
There were churning activities with excessive buying and selling of ASIAEP shares in the Clients’ accounts on a daily basis; buying and selling activities among the Clients, which had their orders matched against each other; and trades with no change in the beneficial ownership, with Pneh Tee Eong being their CDR. These trading activities of the Clients, which were done through Pneh Tee Eong as their CDR, had caused substantial price movement of ASIAEP shares.
4. In deciding the sanctions imposed, Bursa Securities has taken into account the severity of the Breach and all other circumstances of the case including the fact that Pneh Tee Eong has assisted and co-operated with Bursa Securities in its investigation and the expeditious resolution of the case by him electing not to contest the Breach.
5. In addition to the fine of RM100,000 and reprimand, Bursa Securities has struck off Pneh Tee Eong from the Register as a DR to trade on or through the stock market of the Exchange as in the light of the findings, Bursa Securities concludes that the fitness and properness of Pneh Tee Eong as a DR has been called into question.
6. The need to prevent manipulative activities is imperative to maintain a fair and orderly market. Bursa Securities will not tolerate any acts or practices which create false or misleading appearances with respect to the trading activities and affect the integrity of the market that Bursa Securities operates. In such circumstances, Bursa Securities will not hesitate to impose fine and strike off a person from the Register and bar the person from trading on or through the stock market of the Exchange.