MAS files civil penalty action vs UOB trader

Teoh Teck Shin was fined $73,000 for conducting illegal personal trades.

The Monetary Authority of Singapore (MAS) has taken civil penalty enforcement action against Mr Teoh Teck Shin for contravening section 197(1)(b) of the Securities and Futures Act (SFA) by intentionally creating a false or misleading appearance with respect to the price of securities.

Mr Teoh was a remisier with UOB Kay Hian Pte Ltd when the contravention took place. The trades in question were conducted using his personal trading account.

According to MAS, on three trading days between February 2008 and August 2008, Mr Teoh conducted trades which were intended to affect the share price of City Development Limited, Capitaland Limited and Sembcorp Marine Limited. This influenced the Designated Market Makers (DMMs) for the structured warrants over these shares to adjust their buy and sell quotes for the warrants. As a result, Mr Teoh’s earlier orders in the warrants were able to match the DMMs’ revised quotes.

Through his actions, Mr Teoh had intentionally created a false or misleading appearance with respect to the price of the underlying shares in order to profit from his trades in the warrants.

Mr Teoh has admitted to civil penalty liability for contravening section 197(1)(b) of the SFA. Mr Teoh made a profit of about $29,000 and will pay a civil penalty of $73,000 to MAS without court action. MAS has also issued an order against Mr Teoh prohibiting him, for a period of 3 years, from conducting business in any regulated activity or acting as a representative in respect of any regulated activity; and taking part in the management of any holder of a capital market services licence or any person exempt under section 99(1) of the SFA in Singapore.

Mr Lee Chuan Teck, Assistant Managing Director for Capital Markets, MAS, said: “The trades in this case undermined the integrity of our markets as they were done with the purpose of manipulating the share price so as to profit from the corresponding price changes in the structured warrants. Such trades are prohibited under our securities law. MAS will take firm action against any market participant who engages in such conduct."