The High Court today found that the Securities Commission Malaysia (SC) had successfully proven its claim in a civil suit against Dato’ Sreesanthan Eliathamby, 60, for insider trading.
Judge Azizul Azmi bin Adnan found that Dato’ Sreesanthan had breached section 89E(2)(a) of the Securities Industry Act 1983 when he acquired a total of 600,000 shares of Worldwide Holdings Berhad (Worldwide) between 7 June 2006 and 11 July 2006 while in possession of material non-public information.
In its decision, the High Court found that Dato’ Sreesanthan was in possession of material non-public information relating to the proposed privatisation of Worldwide undertaken by Perbadanan Kemajuan Negeri Selangor by way of a member’s scheme of arrangement under section 176 of the Companies Act 1965. The proposed privatisation of Worldwide was subsequently announced to Bursa Malaysia on 23 August 2006.
Dato’ Sreesanthan was a senior partner in a law firm and acted as a legal adviser for the proposed privatisation of Worldwide.
In allowing the SC’s claim, Dato’ Sreesanthan was ordered to pay to the SC a sum of RM1,989,402.00 being an amount equal to three times the profits gained as a result of the insider trading.
In addition, Dato’ Sreesanthan was also ordered to pay the SC a civil penalty of RM1,000,000 and barred from being a director of any public listed company for a period of ten years starting 18 November 2020. The SC was also awarded costs of RM100,000.
