SINGAPORE - Four former remisiers were jailed on Tuesday (Aug 30) for orchestrating an extensive market rigging scheme that involved the largest number of share counters rigged in Singapore's history.
The highly successful scheme, which took place between March 2015 and April 2016, went undetected by the authorities for 13 months, and saw the scheme's members manipulate the price of 55 share counters on 85 separate occasions.
This enabled them to reap sizeable illicit financial gains of $1.2 million at the expense of the unsuspecting investing public, in violation of Section 197 of the Securities and Futures Act.
Alan Lee, 47, a former remisier at OCBC Securities, was sentenced to 24 weeks' imprisonment, while Chew Wei Zhan (Gavin Chew), 43, from DBS Vickers Securities and Lee Wei Kai (Gavin Lee), 44, from Phillip Securities, were each handed a jail term of 23 weeks. All three were fined $260,000.
Co-accused Lim Ming Yi (Warren), 43, from Maybank Kim Eng Securities, was jailed for 19 weeks and fined $190,000.
In May, the fifth accomplice, Lim Ming Chit (Edmund), 47, from Phillip Securities was sentenced to 12 weeks' imprisonment and fined $260,000.
The five accomplices had conspired to create a false appearance of active trading in certain share counters listed on the mainboard or Catalist board of the Singapore Exchange (SGX) through the execution of coordinated trades in a target share counter.
The increased trading volumes in the counter would create artificial market interest in that counter and induce investors in the open market to trade the shares, thereby driving the share price upwards.
Once the share prices had risen to a specific level, the accused would offload their shares for profit within three days.
The profits would be divided and handed over in cash whenever the accomplices met in person.
Court documents stated that the scheme was discovered after a member of the public wrote a letter of complaint to the SGX customer service department, alleging that a group of remisiers was manipulating the trading of shares in EMAS Offshore, an offshore services provider which has since ceased trading on the SGX.
SGX Securities Surveillance conducted a review of the accused persons' trading activity and uncovered the extent of the manipulation.
Thereafter, the Monetary Authority of Singapore commenced investigations.
In the deputy public prosecutors' (DPPs) submissions on sentence, the DPPs highlighted that the offences were committed as part of a "highly premeditated, long-running and complex scheme", and relied on the accused persons' knowledge and expertise as remisiers to target a large number of share counters and exploit the financial infrastructure and national securities market.
The DPPs also noted that securities offences have unique characteristics that distinguish them from other financial crimes.
"There is a strong public interest in the protection of the investing public, as well as the institutions which support the functioning of the securities market. To that end, it bears mentioning that the class of public investors protected include retail investors, who may be unsophisticated or vulnerable," said the DPPs.
"Protecting confidence in the securities market is paramount. The undercutting of confidence in the securities market occasioned by securities offences is itself a dangerous harm, quite apart from the financial losses that such offences may cause."
The DPPs noted that over the period of manipulation by the accused persons, some unsuspecting public investors, who were induced by the artificial market interest in the share counters and traded alongside the scheme members, must have suffered some loss.
The four men could have been jailed for up to seven years for each charge of false trading.