MAS Takes Civil Penalty Action against Lim Oon Cheng and Lim Huey Yih for Insider Trading
Singapore, 29 April 2015... The Monetary Authority of Singapore (MAS) has imposed civil penalties on Mr Lim Oon Cheng and his niece, Ms Lim Huey Yih, for contraventions under the Securities and Futures Act (SFA). Both Mr Lim and Ms Lim have admitted to committing insider trading. Mr Lim has also admitted to false trading.
2 Between 15 and 22 May 2009, Mr Lim purchased 2.27 million shares in Singapore Petroleum Company Limited (SPC) and 101,000 shares in Keppel Corporation Limited (KCL) while in possession of price-sensitive and non-public information relating to PetroChina International (Singapore) Pte Ltd’s (PIPL) acquisition of SPC shares from KCL (the Share Acquisition) and PIPL’s mandatory general offer for SPC shares (the Mandatory General Offer). Ms Lim purchased 892,000 shares in SPC over the same period while also in possession of this price-sensitive and non-public information. The Share Acquisition and the Mandatory General Offer were subsequently announced on 24 May 2009.
3 In addition Mr Lim entered an order on 19 May 2009 to sell 300,000 shares in SPC at the intra-day high of $4.39 without any intention to fulfill the order. This created a false and misleading appearance in the market for SPC shares.
4 Mr and Ms Lim made a profit of $3,818,853 and $896,340 respectively from their insider trading activities.
5 Mr Lim has admitted to contravening s 219(2)(a) of the SFA for insider trading and s 197(1)(b) of the SFA for false trading and he has agreed to pay a civil penalty of $9.597 million (comprising $9.547 million for insider trading and $50,000 for false trading).
6 Ms Lim has admitted to her contravention of s 219(2)(a) of the SFA for insider trading and she has agreed to pay a civil penalty of $2.241 million.
Notes to Editor
(A) The civil penalty regime
(i) A civil penalty action is not a criminal action and does not attract criminal sanctions. The civil penalty regime, designed to complement criminal sanctions and provide a nuanced approach to combat market misconduct, became operational at the beginning of 2004.
(ii) Under section 232 of the SFA, MAS may enter into an agreement with any person for that person to pay, with or without admission of liability, a civil penalty for contravening any provision of Part XII of the SFA. The civil penalty may be up to three times the amount of the profit gained or loss avoided by that person as a result of the contravention, subject to a minimum of $50,000 (if the person is not a corporation) or $100,000 (if the person is a corporation). Where the contravention did not result in the person gaining a profit or avoiding a loss, the civil penalty may be up to $2 million, subject to a minimum of $50,000.
(B) Insider Trading under section 219(2)(a) of the SFA
Section 219(2)(a) prohibits a person who is in possession of materially price-sensitive information concerning a corporation (to which he is not connected), which he knows or ought to know is materially price-sensitive and not generally available, from subscribing for, purchasing, selling, or entering into an agreement to subscribe for, purchase or sell those securities of that corporation.
(C) False Trading under section 197(1)(b) of the SFA
Under section 197(1)(b) of the SFA, a person must not create or do anything that is intended or likely to create a false or misleading appearance with respect to the market for, or the price of, securities.