Singapore Regulator Slaps Civil Penalty On Former Broking Agent, Two-Year Ban

Tom Burroughes

26 March 2015

Singapore’s financial regulator and defacto central bank has imposed a civil penalty of S$157,000 ($114,530), without court action, against a former remisier – aka stockbroker’s agent – for UOB Kay Hian Private Limited, for entering a false sell order to create a false indicative opening price for an exchange traded fund.

The acted against the man for false trading under the Securities and Futures Act.

On 20 October 2011, Tan Hua Ann, then a remisier with UOB Kay Hian Private Limited, entered a false sell order to create a false appearance in the indicative opening price for an exchange-traded fund, Lyxor UCITS ETF MSCI AC Asia Ex Japan (LA10), during the pre-open phase before the start of the Singapore Exchange’s trading day. He made personal gains of S$62,723 from the false trading, MAS said in a statement.

The regulator said Tan had cooperated fully with MAS during the investigation. He admitted to contravening section 197(1)(b) of the SFA through his action. He has paid MAS a civil penalty of S$157,000, without court action.

MAS has also banned Tan from conducting business in any regulated activity under the SFA or acting as a representative in respect of any regulated activity under the SFA, and banned him from taking part in the management of any holder of a capital market services licence or any person exempt from holding a capital market services licence under section 99(1) of the SFA in Singapore, for a period of two years.

“The pre-open phase was introduced to facilitate orderly price discovery before the market opening. Mr Tan, an experienced remisier who understood the pre-open phase, had sought to create a false impression in the indicative price of an ETF during the pre-open phase for personal gain,” Lee Boon Ngiap, assistant managing director, capital markets, at MAS, said.

The matter was referred to MAS by Singapore Exchange Securities Trading Limited.