Bursa Malaysia Securities Berhad (Bursa Malaysia Securities) has publicly reprimanded, imposed a fine of RM40,000 and suspended/restricted (as the case may be) Adnan bin Jusoh (Adnan) for 6 months as / from being a Registered Person, for breaches relating to unauthorised trades / abuse of a client’s account. Adnan was also required to undergo training on the conduct or professionalism of Dealer’s Representative (DR) / market offences.
Adnan, who was at the material time of the breach, a Commissioned Dealer’s Representative of Hong Leong Investment Bank Berhad at its Principal Office, contravened and/or triggered the provisions of Rules 1302.1(1)(a)&(g), 404.3(1)(a)&(b), 404.3(6)(b) and/or 404.4(9)(b) and 1302.1(1)(i)(iii) of the Pre-Revamped Rules of Bursa Malaysia Securities.
Bursa Malaysia Securities views seriously misconducts that compromise the integrity or honesty of Registered Persons and the protection of investors’ interest.
Bursa Malaysia Securities believes that the integrity of Registered Persons including DRs in upholding the interest of clients and the investing public is a matter of utmost importance and any misconduct which impinges on the integrity of the DRs will not be tolerated. Bursa Malaysia Securities will continue to take action against this kind of misconducts and will not hesitate to take the appropriate action against anyone who engages in such misconducts, including suspension / restriction / striking off a Registered Person from the Register, or to impose a substantial fine commensurate with the severity of the breach.
BACKGROUND
The finding of the breach and imposition of the sanctions on Adnan were made pursuant to Rule 15.16 of the Rules of Bursa Malaysia Securities upon completion of due process and after taking into consideration all facts and circumstances, including that:
(a) Adnan had executed trades in one of his client’s account over a period of several months based on instructions from a third party, without the written authorisation of the client.
(b) The trades executed in the client’s account were the third party’s trades and not the client’s trades.
(c) Adnan had used/allowed his client’s account to be used by the third party to execute the third party’s trades and hence unlawfully transacted in the client’s account.
(d) Adnan’s misconducts in handling the client’s account in which unauthorised trading were undertaken in an extensive manner over a period of several months had resulted in the sale of the client’s shares and utilisation of the sales proceeds to set-off contra losses, interest and miscellaneous charges in the client’s account.
(e) As a DR, Adnan must, amongst others:
- observe professional standards of integrity and fair dealing;
- act in the best interests of his client;
- perform his duties efficiently, honestly or fairly;
- obtain prior written authorization from his client before accepting or acting on any instruction received from any other person purporting to act on behalf of that client;
- not use his client’s account to trade for a third party; and
- not unlawfully transact in another person’s account.