Administrative Actions in 2021

No.

Nature of Misconduct

Parties Involved

Brief description of misconduct

Action Taken

Date of Action

1. Breach of 354(1)(b)(ii) of the Capital Markets and Services Act read together with  Paragraph 4.05 and Paragraph 4.06, Section B, Part 2 of the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework ("LOLA Guidelines") AmBank (M) Berhad (“AmBank”) Delay of ten (10) business days in the submission of the monthly post-issuance report for their structured product programme. Penalty of RM10,000.00 9 April 2021
2.

Two (2) breaches under Section 354(1)(b)(iii) of the Capital Markets and Services Act 2007 read together with Clause 3.1.3(a) of the Code of Ethics and Rules of Professional Conduct (Unit Trust Funds) as at 22 January 2013 of The Federation of Investment Managers Malaysia

Rohaini Binti Mohd Satari (“Rohaini”)

As a Unit Trust Consultant of Bank Kerjasama Rakyat Berhad (“Bank Rakyat”), Rohaini had:-

  • Executed 15 unauthorised transactions on the unit trust account of Bank Rakyat’s client; and
  • Knowingly provided statements to Bank Rakyat’s client which contained false or misleading information
  • Reprimand for each breach; and
  • Penalty of RM100,000.00
5 April 2021
3.

Breach of section 354(1)(a) of the Capital Markets and Services Act 2007 (“CMSA”) read together with section 7(1) of the CMSA and Order 3(1) of the Capital Market and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019 (“CMSA Order”)

Remitano Co. Ltd.

Remitano had operated a recognized market (digital asset exchange) without registering with the SC under Section 34 of the CMSA via the website https://remitano.com/btc/my and also through its mobile applications

  • Reprimand
2 April 2021
4. Non-compliance of Paragraphs 19.01 and 19.04 of the Rules on Take-overs, Mergers and Compulsory Acquisitions

Datuk Wira Lye Ek Seang

Non-compliance 1
Datuk Wira Lye, being a person acting in concert with the offeror and the ultimate offeror, had disposed 8,875,770 shares held by him in Caring Pharmacy Berhad (“Caring”) via off-market transactions during the offer period in relation to the take-over offer of Caring without the SC’s consent.

Non-compliance 2
Late disclosure of dealings in relation to some of his Caring shares disposed.

  • Reprimand
  • Penalty of RM38,500
25 March 2021
5.

Non-compliance of Paragraphs 19.01 and 19.04 of the Rules on Take-overs, Mergers and Compulsory Acquisitions

Datuk Seri Syed Ali bin Syed Abbas Al-Habshee

Non-compliance 1
Datuk Seri Syed Ali, being a person acting in concert with the offeror and the ultimate offeror, had disposed 6,527,035 shares held by him in Caring Pharmacy Berhad (“Caring”) via off-market transactions during the offer period in relation to the take-over offer of Caring without the SC’s consent.

Non-compliance 2
Late disclosure of dealings in relation to some of his Caring shares disposed.

  • Reprimand
  • Penalty of RM38,500
25 March 2021
6.

Non-compliance of Paragraphs 19.01 and 19.04 of the Rules on Take-overs, Mergers and Compulsory Acquisitions

Encik Arsam bin Damis

Non-compliance 1
Encik Arsam, being a person acting in concert with the offeror and the ultimate offeror, had disposed 5,085,160 shares held by him in Caring Pharmacy Berhad (“Caring”) via off-market transactions during the offer period in relation to the take-over offer of Caring without the SC’s consent.

Non-compliance 2
Late disclosure of dealings in relation to some of his Caring shares disposed.

  • Reprimand
  • Penalty of RM38,500
25 March 2021
7. Breach of Section 356(1)(a) of the Capital Markets and Services Act 2007 read together Paragraph 4.17 and Paragraph 4.18(e), Section B, Part 1 of the Unlisted Capital Market Products under the Lodge and Launch Framework (LOLA Guidelines) MIDF Amanah Asset Management Berhad Delay of one (1) business day in the submission of the monthly statistical returns of a wholesale fund required until the winding up process is completed. Penalty of RM1,000.00 22 March 2021
8. Breach of Section 356(1)(a) of the Capital Markets and Services Act 2007  read together with Paragraph 4.17, Section B, Part 1 of the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework (LOLA Guidelines) Kumpulan Sentiasa Cemerlang Sdn Bhd Delay of one (1) business day in the submission of the monthly investment report of one wholesale fund. Penalty of RM1,000.00 15 March 2021
9. Breach of 354(1)(a) of the Capital Markets and Services Act 2007 read together with Paragraph 4.05 and Paragraph 4.06, Section B, Part 2 of the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework (LOLA Guidelines) J.P. Morgan Chase Bank Berhad Delay of three (3) business days in the submission of the monthly post-issuance report for their structured product programme. Penalty of RM3,000.00 15 March 2021
10.

Four (4) breaches of section 354(1)(b)(iii) of the Capital Markets and Services Act 2007 (“CMSA”) read together with:-

  • Clauses 5(a)(i) and 5(f) of the Code of Ethics and Standards of Professional Conduct for the Unit Trust Industry as at 1 September 2001 of The Federation of Malaysian Unit Trust Managers
  • Clauses 2.1.9(g), 2.1.14(b) and 2.6.4(b) of the Code of Ethics and Rules of Professional Conduct (Unit Trust Funds) as at 22 January 2013 of the Federation of Investment Managers Malaysia (“FIMM”); and
  • Paragraphs 9(e) and (f) of the Circular entitled “Duties and Responsibilities of Members and Registered Persons in Helping Investors to Make Informed Investment Decisions under Switching Transactions” issued by FIMM dated 14 July 2015
Bank Kerjasama Rakyat Berhad

1st Breach
Bank Rakyat had failed to ensure that its Unit Trust Consultants (“UTCs”) remained fit and proper as they had committed various misconduct against their clients.

2nd Breach
There was no proper segregation of duties between the front office and back office. Bank Rakyat’s UTCs were able to perform both the front office and back office functions.

3rd Breach
There was no oversight by Bank Rakyat’s branches and Head Office over the UTCs.

4th Breach
There were no systems and procedures in place for Bank Rakyat to monitor or review the transactions executed by its UTCs which includes churning.

  • Reprimand for each of the Breaches,
  • Directive to carry out the following:-
    • Bank Rakyat shall allocate and utilise the sum of not less than RM1,260,000.00 within a period of three (3) years from the sanctions towards:-
      • continuous enhancement of Bank Rakyat’s monitoring systems and internal control measures with respect to its unit trust activities; and
      • ensuring effective implementation of its controls and processes including upskilling of staff through training or capacity building;
    • Bank Rakyat shall appoint an independent consultant to review and enhance Bank Rakyat’s internal controls in relation to its unit trust activities which shall be completed within six (6) months from the date of the sanctions, which would include the following:
      • to review that sufficient controls are in place in marketing and distributing unit trust funds and to ensure all lapses in controls are effectively rectified; and
      • to review the effectiveness of Bank Rakyat’s current and planned initiatives particularly in relation to system enhancements, implementation of Suitability Assessment Exercise, on-going monitoring of clients’ transactions and monitoring of marketing and distribution activities (including the competency of bank personnel involved);
    • Bank Rakyat shall only resume its unit trust activities which would include the marketing and distribution of unit trust funds (investment via cash) upon satisfactorily completing paragraph 2(b) above;
    • Bank Rakyat shall report to the SC on the implementation of paragraph 2(a) above every six (6) months from the date of the sanctions until the end of the three (3) year period; and
    • Bank Rakyat shall report to the SC on the implementation of paragraph 2(b) above within six (6) months from the date of the sanctions; and
    • Bank Rakyat shall table these sanctions to Bank Rakyat’s Board of Directors and forward the Board minutes to the SC within one (1) month from the date of the sanctions.
3 March 2021
11.

Breach of 354(1)(a) of the Capital Markets and Services Act read together with  Section 25(4) of the Securities Industry (Central Depositories) Act 1991

Othman bin Bakri ("Othman") Othman was found to be the beneficial owner of the deposited securities, namely Grand-Flo Berhad shares in the CDS account of Mohammed Noor bin Mohd Sham.
  • Reprimand;
  • Penalty of RM84,000.00.

16 February 2021

12.

Breach of section 354(1)(a) of the Capital Markets and Services Act 2007 (“CMSA”) read together with Section 369(b)(B) of the CMSA

G Neptune Berhad Knowingly causing the furnishing of information that is false or misleading to Bursa Malaysia Securities Berhad (“Bursa”), namely the response in G Neptune’s reply dated 9 July 2015 to a query from Bursa (“G Neptune’s Reply to Bursa”).

Reprimand

 

15 February 2021
13.

Breach 1
Breach of Section 218(2) of the Capital Markets and Services Act ("CMSA"), read together with Section 9(1)(a) of the Malaysian Code on Take-overs and Mergers 2010 ("2010 Code") and Paragraph 5.2 of Practice Note 9 of the 2010 Code

Breach 2
Breach of Section 218(2) of the CMSA, read together with Paragraphs 4.01(b) and 4.07(1) of the Rules on Take-overs, Mergers and Compulsory Acquisitions

Sim Cheng Young

Breach 1

  • Failure to undertake a mandatory offer or to seek exemption, in relation to his acquisition of shares in Grand Hoover Berhad ("GHB") on 5 January 2015, which increased his shareholding when aggregated with the shareholding of Dynamic Merchant Limited, his wholly owned company to above 33% in GHB.

Breach 2

  • Failure to undertake a mandatory offer or to seek exemption, in relation to shares transferred to him pursuant to a Grant of Probate with respect to his late mother's GHB shares on 7 January 2020, which increased his shareholding in GHB by more than 2% in a period of six months.
SC imposed a penalty of RM35,000 for the breaches 20 January 2021
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