Administrative Actions in 2015 - Administrative Actions

Administrative Actions in 2015

No.	Nature of Misconduct	Parties Involved	Brief description of misconduct	Action Taken	Date of Action
1.	Breach of Section 356(1) read together with Section 61(4) of the Capital Markets and Services Act 2007 (“CMSA”) and Paragraph 7.02(7) of the Licensing Handbook as at 30 June 2014	Phillip Capital Management Sdn Bhd (“PCM”), a holder of a Capital Markets Services Licence for fund management	There were lapses in PCM’s and PMB’s middle office functions resulting in non-compliances with provisions in the Guidelines for Compliance Function for Fund Management Companies (for PCM), Guidelines on Unit Trust Funds (for PMB), Licensing Handbook as at 30 June 2014 and Guidelines on Prevention of Money Laundering and Terrorism Financing for Capital Market Intermediaries (hereinafter referred to as “SC’s Guidelines”).As a result, PCM and PMB has contravened a condition of their licences which requires PCM and PMB to supervise and monitor their businesses to ensure compliance with SC’s Guidelines.	Reprimand; and Directive against PCM and PMB respectively: to implement all remedial measures as represented to the SC in their replies to SC’s Notices to Show Cause (“Remedial Measures”) within twelve (12) months from the date of sanctions; to appoint an external auditor who is acceptable to the SC, to undertake an assessment on the sufficiency and effectiveness of the Remedial Measures undertaken by PCM and PMB. In this regard, the scope of this assessment will be determined and agreed upon by both the external auditor and SC; and not to launch any new funds until PCM and PMB receive SC’s notification that SC is satisfied with the sufficiency and effectiveness of the Remedial Measures.	18 December 2015
1.		Phillip Mutual Berhad (“PMB”), a holder of a Capital Markets Services Licence for dealing in securities restricted to unit trust and dealing in Private Retirement Scheme			18 December 2015
2.	Breach of Section 355(1) of the CMSA read together with: Section 61(4) of the CMSA and Paragraph 7.02(7) of the Licensing Handbook as at 30 June 2014; and Rule 610.3 of Rules of Bursa Malaysia Derivatives Berhad (“Bursa Derivatives Rules”)	Phillip Futures Sdn Bhd (“PF”), a holder of a Capital Markets Services Licence for dealing in derivatives	There were lapses in PF’s middle office functions resulting in non-compliances with provisions in the Licensing Handbook as at 30 June 2014 and Guidelines on Prevention of Money Laundering and Terrorism Financing for Capital Market Intermediaries (hereinafter referred to as “SC’s Guidelines”). As a result, PF has contravened a condition of its licence which requires PF to supervise and monitor its business to ensure compliance with SC’s Guidelines. PF has also contravened Bursa Derivatives Rules by not having written record to evidence that its Internal Audit has performed annual examination on PF’s operations in the year 2013.	Reprimand; and Directive to: implement all remedial measures as represented to the SC in its reply to SC’s Notice to Show Cause (“Remedial Measures”) within twelve (12) months from the date of sanctions; and appoint an external auditor who is acceptable to the SC, to undertake an assessment on the sufficiency and effectiveness of the Remedial Measures undertaken by PF. In this regard, the scope of this assessment will be determined and agreed upon by both the external auditor and SC.	18 December 2015
3.	Breach of Section 72(2)(b)(i) read together with Sections 65(1)(g)(iv) and (l) of the Capital Markets and Services Act 2007 for:(a) engaging in business practices appearing to the SC to be improper in relation to the regulated activity of dealing in securities; and(b) the SC has a reason to believe that Hon Sook Yin will not carry on the regulated activity of dealing in securities and dealing in derivatives efficiently, honestly or fairly.	Hon Sook Yin as a holder of a CMSRL for the regulated activity of dealing in securities and dealing in derivatives.	Hon Sook Yin was found to be in breach of Rules 401.1(3), 404.3(1)(a) and (c) and 1302.1(1)(a) and (g) of the Pre-Revamped Rules of Bursa Malaysia Securities for engaging in manipulative activities in relation to the trading of Notion VTec Berhad securities.As a result, SC finds that Hon Sook Yin is no longer fit and proper to continue to undertake the regulated activity of dealing in securities and dealing in derivatives.	Imposition of a permanent restriction on her CMSRL in relation to her regulated activity of dealing in securities under Section 72(6) of the Capital Markets and Services Act 2007; and	28 August 2015
				Revocation of her CMSRL in relation to the regulated activity of dealing in derivatives under Section 72(2)(b)(i) of the Capital Markets and Services Act 2007. Hon Sook Yin is no longer permitted to undertake any regulated activity in relation to dealing in securities and dealing in derivatives.	18 December 2015
	Hon Sook Yin had on 3 May 2021 applied for a CMSRL relating to dealing in securities, and after the SC’s consideration and deliberation, the SC has approved her CMSRL for a period of one year from 10 September 2021 to 09 September 2022.
4.	Breach of Section 356(1)(a) of the Capital Markets and Services Act 2007 read together with Paragraphs 4.17 and 4.18(c), Section B, Part 1 of the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework	CIMB-Principal Asset Management Berhad (“CPAM”), a holder of a Capital Markets Services Licence for dealing in securities restricted to unit trust, fund management, dealing in Private Retirement Scheme and financial planning	Delay of 2 business days in submitting the monthly statistical returns for a wholesale fund	SC imposed a penalty of RM2,000.00 against CPAM	15 December 2015
		RHB Asset Management Sdn Bhd (“RHBAM”), a holder of a Capital Markets Services Licence for dealing in securities restricted to unit trust, fund management, dealing in Private Retirement Scheme and investment advice	Delay of 1 business day in submitting the monthly statistical returns for a wholesale fund	SC imposed a penalty of RM1,000.00 against RHBAM	15 December 2015
		Libra Invest Berhad (“Libra Invest”), a holder of a Capital Markets Services Licence for dealing in securities restricted to unit trust and fund management	Delay of 1 business day in submitting the monthly statistical returns for 7 wholesale funds	SC imposed a penalty of RM7,000.00 against Libra Invest	15 December 2015
5.	Breach of Section 61(4) of the Capital Markets and Services Act 2007 (“CMSA”) read together with the following paragraphs of the Licensing Handbook as at 8 July 2015: (a) Paragraph 4.02(17) – requirement to have at least one director who has a minimum of 10 years relevant experience in the licensed regulated activity; (b) Paragraph 4.02(30) – requirement to have at least two (2) Capital Market Services Representative’s Licence (“CMSRL”) holders for each regulated activity; and (c) Paragraph 4.02(27) – requirement to have a compliance officer.	Mercury Asset Management Sdn Bhd, a holder of a Capital Markets Services Licence (“CMSL”) carrying out the regulated activity of fund management.	Mercury Asset Management Sdn Bhd failed to have: (a) a licensed director; (b) at least two (2) CMSRL holders; and (c) a compliance officer. As a result of the above, the SC finds that Mercury Asset Management Sdn Bhd is no longer fit and proper to continue to be licensed as a CMSL.	Revocation of Mercury Asset Management Sdn Bhd’s CMSL for the regulated activity of fund management pursuant to Section 72(2)(a)(iii) of the CMSA.	19 November 2015
6.	Breach of Section 72(2)(b)(i) read together with Sections 65(1)(g)(iv) and (l) of the Capital Markets and Services Act 2007 for:(a) engaging in business practices appearing to the SC to be improper; and(b) the SC has reason to believe that Ng Soo Ging will not carry on the regulated activities of dealing in securities and dealing in derivatives efficiently, honestly or fairly.	Ng Soo Ging as holder of a Capital Markets Services Representative’s Licence (“CMSRL”) carrying out the regulated activities of dealing in securities and dealing in derivatives.	Ng Soo Ging was found to be in breach of Rules 401.1(3), 404.3(1)(a) and (c) and 1302.1(1)(a) and (g) of the Pre-Revamped Rules of Bursa Malaysia Securities Berhad for engaging in manipulative activities in relation to the trading of shares in GPRO Technologies Bhd, Industronics Bhd and MNC Wireless Bhd.As a result, the SC finds that Ng Soo Ging is no longer fit and proper to continue to be licensed as a CMSRL.	Revocation of her CMSRL for the regulated activities of dealing in securities and dealing in derivatives under Section 72(2)(b)(i) of the Capital Markets and Services Act 2007.	18 November 2015
6.	Breach of Section 356(1)(a) of the Capital Markets and Services Act 2007 read together with Paragraphs 4.17 and 4.18(c), Section B, Part 1 of the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework.	Affin Hwang Asset Management Berhad (“Affin Hwang”), a holder of a Capital Markets Services Licence for the regulated activity of dealing in securities restricted to unit trust, fund management and dealing in Private Retirement Scheme.	Delay of 1 business day in submitting the monthly statistical returns for a wholesale fund.	SC imposed a penalty of RM1,000.00 against Affin Hwang.	17 November 2015
7.	Breach of Section 354(1)(a) of the Capital Markets and Services Act 2007 (“CMSA”) read together with Regulation 4(1) of the Securities Industry (Compliance with Approved Accounting Standards) Regulations 1999 (“SIR”)	Niche Capital Emas Holdings Berhad (“NICE”); and Individual directors of NICE in relation to the following Audited Financial Statements (“AFS”): AFS for financial period ended 30 June 2011 (“AFS 2011”) Dato’ Tan Sek Yin Ng Chin Nam Patrick Cheng Ther Wee Md Shahar Md Noor Yap Chee Keong AFS for financial period ended 31 December 2012 (“AFS 2012”); Dato’ Tan Sek Yin Ng Chin Nam Patrick Cheng Ther Wee Mah Weng Kee Dato’ Tiong Chau Siong AFS for financial year ended 31 December 2013 (“AFS 2013”) Dato’ Tan Sek Yin Ng Chin Nam Mah Weng Kee Dato’ Tiong Chau Siong	NICE and its directors, in preparing and presenting NICE’s AFS 2011, AFS 2012 and AFS 2013, failed to comply with approved accounting standards by: recognising the sum of RM11,513,000 as an asset under the item “other receivables” in AFS 2013 which is not in accordance with MFRS 137 – Provisions, Contingent Liabilities and Contingent Assets; failing to measure its obligations under the corporate guarantees on bank borrowings by former subsidiary, Yikon Jewellery Industry Sdn Bhd (“YJI”) in AFS 2011 in accordance with FRS 139 – Financial Instruments: Recognition and Measurement (“FRS 139”); and failing to measure its obligations under the corporate guarantees on bank borrowings by YJI in AFS 2012 in accordance with FRS 139.	Against NICE:The SC reprimanded NICE and directed NICE to: (a) rectify & re-issue AFS 2013 and all quarterly results issued subsequent to the issuance of AFS 2013; (b) explain the effects of the rectification in re-stated AFS 2013; (c) present a statement of profit or loss and other comprehensive income for the financial period ended 30 June 2011 together with the related note information in the re-stated AFS 2013; and (d) make an announcement to Bursa Malaysia on the rectification made, the reasons therefor and the effects of the said rectification. Against individual directors of NICE: The SC reprimanded the following directors and imposed a fine on each of the directors, as follows: Ng Chin Nam – RM75,000; Dato’ Tan Sek Yin – RM30,000; Dato’ Tiong Chau Siong – RM50,000 Patrick Cheng Ther Wee – RM50,000; Mah Weng Kee – RM25,000; Md Shahar Bin Md Noor – RM30,000; and Yap Chee Keong – RM20,000.	2 September 2015
8.	Breach of Section 72(2)(b)(i) read with Section 65(1)(g)(iv) of the Capital Markets and Services Act 2007 (“CMSA”) for engaging in business practices appearing to the SC to be improper.	Khoo Chee Leong a holder of a Capital Markets Services Representative’s License (“CMSRL”) carrying out the regulated activity of dealing in securities.	Khoo Chee Leong pre-signed remittance request forms and withdrawal forms which were utilised by his assistant, who is also his wife, to:(i) deposit a cheque made out by his client for settlement of share purchases, into the trust account of a related person; and (ii) withraw the said sum from the trust account and deposited it into his wife’s joint banking account with the said related person.The amounts deposited and withdrawn were finally used by his assistant to settle share purchases made by the client.Khoo also failed to carry out his clients’ instruction in relation to the disposal of certain shares.As a result of the above, the SC finds that Khoo Chee Leong is no longer fit and proper to continue to be licensed as a CMSRL.	Revocation of his CMSRL for the regulated activity of dealing in securities, pursuant to Section 72(2)(b)(i) of the CMSA.	28 August 2015
9.	Breach of Section 356(1) of the Capital Markets and Services Act 2007 (“CMSA”) for failure to comply with:(a) Section 61(4) of the CMSA read together with Paragraph 7.02(12)(a) of SC’s Licensing Handbook; and(b) Paragraph 8.2.1 read together with Paragraphs 11.2, 11.3 and 11.4 of the SC’s Guidelines on Prevention of Money Laundering and Terrorism Financing for Capital Market Intermediaries (“AML Guidelines”).	Kenanga Investment Bank Berhad (a Capital Markets Services Licence holder carrying out the regulated activity of dealing in securities)	(a) Failure to adequately supervise its licensed representative in the performance of his duties;(b) Failure to conduct ongoing customer due diligence; and(c) Failure to identify suspicious transactions and lodge a suspicious transaction report.	(a) Penalty RM200,000; and(b) Directive to KIBB’s key management personnel including the Head of Compliance to attend two (2) AML/CFT trainings to familiarise themselves with the requirements under the AML Guidelines or similar AML/CFT trainings on preventive measures for financial institutions that is consistent with the standards issued by the Financial Action Task Force (FATF).	28 August 2015
10.	Breach of Section 72(2)(b)(i) read together with Sections 65(1)(g)(iv) and (l) of the Capital Markets and Services Act 2007 for:(a) engaging in business practices appearing to the SC to be improper; and(b) the SC has a reason to believe that Lim Chin Wat will not carry on the regulated activity of dealing in securities efficiently, honestly or fairly.	Lim Chin Wat as holder of a Capital Markets Services Representative’s Licence (“CMSRL”) carrying out the regulated activity of dealing in securities.Note: Lim Chin Wat also holds a CMSRL for dealing in derivatives that is unaffected.	Lim Chin Wat was found to be in breach of Rules 401.1(3), 404.3(1)(a) and (c) and 1302.1(1)(a) and (g) of the Pre-Revamped Rules of Bursa Malaysia Securities for engaging in manipulative activities in relation to the trading of Magna Prima Berhad shares.As a result, the SC finds that Lim Chin Wat is no longer fit and proper to continue to be licenced as a CMSRL.	Revocation of his CMSRL for dealing in securities under Section 72(2)(b)(i) of the Capital Markets and Services Act 2007.	28 May 2015
11.	Breach of Section 356(1)(a) read together with Section 71 of the Capital Markets and Services Act 2007	Robyn Lau Zheng-Yin (a Capital Market Services Representative’s Licence (“CMSRL”) holder carrying out dealing in securities at TA Securities Holdings Berhad)	Made a statement that was false or misleading in a material particular namely, by representing to the SC that she had passed Modules 6 and 7 in the result slips provided by her to the SC, knowing that the information in the result slips was false or misleading.	Revocation of her CMSRL under Section 72(2)(b)(i) read together with Section 65(1)(c) of the Capital Markets and Services Act 2007.	20 May 2015
12.	Breach of Section 356(1)(a) read together with Section 71 of the Capital Markets and Services Act 2007	Shahmir Pavin Joshi (a Capital Market Services Representative’s Licence (“CMSRL”) holder carrying out advising in corporate finance at Maybank Investment Bank Berhad)	Made a statement that was false or misleading in a material particular namely, by representing to the SC that he had passed Modules 12 and 19 in the result slips provided by him to the SC, knowing that the information in the result slips was false or misleading.	Revocation of his CMSRL under Section 72(2)(b)(i) read together with Section 65(1)(c) of the Capital Markets and Services Act 2007.	20 May 2015
13.	Breach of Section 354(1)(a) read together with Section 369(b)(B) of the Capital Markets and Services Act 2007	YFG Berhad and its Board of Directors as at 5 November 2014	YFG furnished false or misleading statement to Bursa Malaysia Securities Berhad in relation to the impairment loss provision in its Audited Financial Statements (AFS) for year ended 30 June 2014	Directed YFG to rectify and re-issue the AFS for year ended 30 June 2014, by reinstating the impairment loss provision and make the necessary consequential amendments to its financial statements appropriately. A reprimand and penalty of RM200,000 on the Board of Directors of YFG Berhad.Having considered the grounds of the review applications dated 12 June 2015 on the sanctions against YFG and YFG Board (as at 5 November 2015), the SC has on 31 July 2015 rejected the review applications	13 May 2015
14.	Breach of Section 356(1)(a) of the Capital Markets and Services Act 2007 read together with paragraphs 8.2.1(a), 8.2.2, 8.2.4(a), 8.2.5, 11.1, 11.3(a), 11.3(b) and 11.7 of the SC’s Guidelines on Prevention of Money Laundering & Terrorism Financing for Capital Market Intermediaries	AmFutures Sdn Bhd (a Capital Markets Services Licence holder carrying out the regulated activity of dealing in derivatives)	Failure to conduct proper on-going due diligence and effectively detect suspicious transactions	Penalty RM250,000	29 April 2015
15.	Breach of Section 356(1)(a) of the Capital Markets and Services Act 2007 read together with paragraph 7.02(9) of SC’s Licensing Handbook (revised as at 5 September 2014).	PCB Asset Management Sdn. Bhd. (a Capital Markets Services License holder carrying out the regulated activity of fund management).	Allowing unlicensed persons to carry out licensed activity of dealing in securities by formalising a referral arrangement with unlicensed persons to solicit fund management clients.	Penalty RM100,000	28 April 2015

No record found.