MAS issues 5-year bans on ex-trader convicted of CFD fraud

According to the Monetary Authority of Singapore, Dennis Tey Tey used different trading accounts to enter false orders in underlying securities in order to temporarily change the prices of their corresponding Contract for Differences.
According to the Monetary Authority of Singapore, Dennis Tey Tey used different trading accounts to enter false orders in underlying securities in order to temporarily change the prices of their corresponding Contract for Differences.PHOTO: EPA-EFE

SINGAPORE - The Monetary Authority of Singapore (MAS) on Thursday (Nov 21) issued two five-year prohibition orders (POs) against former DBS Vickers trader, Dennis Tey, 33, for unauthorised trading and fraud.

The first PO is related to activities regulated by the Securities and Futures Act. The activities include being a trader. Accordingly, Tey will be banned from performing any regulated activity; and from taking part in the management of any capital market services firm.

The second PO is with regards to financial advisory services. This means that Tey will be prohibited from providing any financial advisory services; and from being a manager, director, or substantial shareholder of any financial advisory firm in Singapore.

Earlier this year, in March , Tey was convicted of six charges for employing a scheme to defraud; and two charges for unauthorised trading. He was sentenced to a total of 16 weeks' jail.

Between October 2012 and January 2013, Tey used different trading accounts to enter false orders in underlying securities in order to temporarily change the prices of their corresponding Contract for Differences (CFDs), MAS said. To carry out his scheme, Tey used three securities and two CFD accounts opened in the names of his parents and clients. A CFD is a tradable leveraged instrument where investors can profit from the price fluctuations of underlying assets without actually owning them.

According to MAS, Tey then executed CFD trades at the manipulated prices, before removing the false orders for the underlying securities. This caused the CFD prices to "move in a direction that was beneficial to him but detrimental to the CFD providers".

He made a total profit of S$30,239 through the scheme.

Tey, a Malaysian who left DBS Vickers in March 2014, was arrested in May 2015 and charged in July last year.

His case was the first pursued jointly by MAS and the Commercial Affairs Department of the Singapore Police Force since they banded together in March 2015 to probe market misconduct as part of Singapore's efforts to step up policing of its financial industry.