Ex-CEO of APL Industries Bhd and Ex-Remisier Fined and Jailed Five Years for Insider Trading

24 November 2017 | Kuala Lumpur

The Kuala Lumpur Sessions Court today convicted former CEO of APL Industries Bhd (APLI), Stanley Thai Kim Sim, and former remisier Tiong Kiong Choon for insider trading offences. Thai was sentenced to a five-year jail term and a RM5 million fine, while Tiong was sentenced to five years jail and a RM10 million fine.

Insider trading offences, under section 188 of the Capital Markets and Services Act 2007 (CMSA), carry a mandatory punishment of imprisonment not exceeding 10 years and a fine of not less than RM1 million.

Thai was convicted for communicating non-public information between 26 October 2007 and 29 October 2007 to Tiong. Tiong was convicted for two counts of disposing a total of 6,208,500 APLI shares while in possession of the same non-public information via accounts belonging to his mother-in-law and his mother. At the time of the commission of the offence, Tiong was also a licensed intra-day trader with a stock broking company.

The non-public information communicated from Thai to Tiong related to the audit adjustments proposed by APLI’s auditors which resulted in APLI reporting a higher loss for the financial year ended 30 June 2007, as compared to the previously reported unaudited Q4 results for the same financial year, and that APLI would be classified as a PN 17 company. APLI made announcements to Bursa Malaysia Securities Bhd about the audit adjustments and its classification as a PN 17 company on 31 October 2007.

In passing the sentence, Sessions Court judge Tuan Zulqarnain Hassan ruled that a deterrent sentence was warranted as insider trading offences were deemed more serious than conventional crimes, given far reaching effects on investors’ confidence and the public as a whole. “Insider trading is a modern white-collar economic crime. It is serious and is in a category or class of its own,” said the learned judge.

The conviction came after a full trial where 14 witnesses testified for the Prosecution while four witnesses testified for the defence.

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