Report by The Securities and Futures Commission of Hong Kongon an Investigation into Trading of Shares of CrownhamptonInternational Limited
25 Feb 1998... Hong Kong's Securities & Futures Commission (SFC) has issued a Report on its investigation into possible insider trading of shares in Crownhampton International Limited (Crownhampton).
2 Between February 1994 and May 1995, the SFC asked MAS for assistance to investigate possible insider trading in Crownhampton shares by some Singaporeans. The SFC enquired if the persons being investigated might have breached Singapore's insider trading law. It wanted MAS to confirm whether any penalty made under an order of Hong Kong's Insider Dealing Tribunal (IDT) would be enforceable in Singapore. The SFC also sought MAS' help to obtain certain documents and interview the persons investigated by the SFC.
3 MAS informed the SFC that no offence had been committed in Singapore, as the dealing in securities had taken place in Hong Kong. We explained that should IDT seek to enforce any penalty in Singapore, it could face considerable legal difficulty, but the issue would be settled by the Singapore High Court.
4 MAS also advised the SFC that MAS did not have legal powers to compel the persons concerned to attend interviews by the SFC or to produce the documents requested. But MAS would provide all other assistance permitted under Singapore law.
5 In October 1996, the SFC informed Singapore's Commissioner to Hong Kong that it had decided not to proceed with its investigation, and that it would publish a report of the investigation.
6 Singapore has cooperated with the SFC investigation to the full extent possible under Singapore law. The SFC has acknowledged this in its report. Singapore has similarly helped foreign autho-rities to investigate various other offences, to the extent permitted by Singapore law.
7 Singapore takes a serious view of insider trading. It is a criminal offence in Singa-pore, unlike in some other jurisdictions. We have vigorously pursued all cases of suspected insider trading in Singapore. But our insider trading laws have no extra-territorial application, like laws against insider trading in most other jurisdictions. In the case of Crownhampton, because the trading took place in Hong Kong, we could not act against suspected persons in Singapore.
8 MAS does not have the power under Singapore law that would have enabled it to compel the persons concerned to co-operate with the SFC investigation. But to the extent permitted under Singapore law, MAS will cooperate with and extend assistance to the SFC and other regulatory bodies. As a result of this case, MAS is also studying whether to change our laws to allow greater cooperation with other regulatory authorities in cross-border investigations.