Response to "Some Consistency in Punishment, Please" (TODAY, 19 Jun 2008)
"Some consistency in punishment, please" (TODAY, 19 June 2008) noted the need for "clear rules and regulations as to when and what matters go to court, and when 'departmental' action is taken".
Allow us to clarify.
The Singapore Exchange (SGX), Monetary Authority of Singapore (MAS) and the Commercial Affairs Department (CAD) work together closely on cases of market misconduct.
SGX conducts market surveillance to detect unusual trading activities and prohibited trading conduct, including insider trading and market manipulation. Where a breach of SGX rules by an SGX member or its staff is established, the Exchange may refer the matter to the appropriate disciplinary committee within its disciplinary framework. To ensure a high level of impartiality and objectivity, members of the disciplinary committee, who are drawn from the industry and legal profession, are independent of the Exchange. The disciplinary committee will decide on the appropriate penalty. A member or registered representative charged before a disciplinary committee may be reprimanded, fined, suspended and/or expelled.
Where the matter involves a violation of the law, it would be referred to MAS and/or CAD.
When deciding whether to undertake civil penalty enforcement action or refer a matter to CAD for criminal investigation, MAS takes into consideration the degree of seriousness of the misconduct, the extent of impact of the misconduct on the market, the need for effective deterrence and other relevant characteristics of the case
For example, market misconduct cases involving fraud or conspiracy, breaches of other criminal law or multiple offences that caused significant market disruption would generally be more suitable for prosecution under the criminal regime.
Clear rules, regulations and procedures relating to market misconduct are in place. These are implemented with the assistance of internal protocols on the appropriate handling of specific matters. There is also ongoing communication between the agencies on the effectiveness of these arrangements.
As a matter of policy, we do not consider it appropriate to reveal the detailed criteria for assessing and tracking market misconduct cases as this could help potential offenders avoid liability. This is consistent with the practice in most other jurisdictions.
Market participants must know that market misconduct will not be tolerated and the regulators will take firm and effective actions against persons who breach our laws.
Angelina Fernandez Director (Communications) Monetary Authority of Singapore
Kelly Long Vice-President and Head of Corporate Communications Singapore Exchange Limited