Lawyer Dato’ Sreesanthan Settles SC Charges for Insider Trading

21 October 2021

In reference to news articles published yesterday, 20 October 2021, of the “acquittal” of a senior corporate lawyer for insider trading, the Securities Commission Malaysia (SC) would like to state the following facts:
  1. Lawyer Dato’ Sreesanthan a/l Eliathamby (Sreesanthan) has agreed to pay RM900,000 disgorgement of profits as part of a Regulatory Settlement Agreement with the SC for insider trading of the shares of Maxis Communications Berhad, UEM World Berhad and VADS Berhad.
  2. Following this settlement, the SC, with the consent of the Public Prosecutor, withdrew related criminal proceedings against Sreesanthan, and its appeal against his acquittal in another case for insider trading of Sime Darby Berhad shares.
  3. This settlement does not affect another ongoing civil proceeding against Sreesanthan in relation to his acquisition of 600,000 Worldwide Holdings Berhad shares between June and July 2006, while in possession of material non-public information. In this proceeding, Sreesanthan was found liable by the High Court on 4 November 2020 and ordered to pay to the SC a sum of RM1,989,402 in disgorgement, a civil penalty of RM1 million and barred from holding directorships of public listed companies for a period of 10 years, effective 18 November 2020. Sreesanthan has filed an appeal to the Court of Appeal against this decision.
  4. Sreesanthan was charged in July 2012 for insider trading involving Sime Darby, Maxis Communications, UEM World and VADS’ shares between October 2006 and September 2008, when he was a senior partner of a law firm involved in the corporate exercises of these companies.
  5. Even though the SC charged Sreesanthan in 2012, the trial only commenced in 2019 as Sreesanthan had, in September 2012, filed an application to challenge the constitutionality of the investigative powers of the SC under sections 128 and 134 of the Securities Commission Malaysia Act 1993. Sreesanthan had also filed an application to strike out the criminal charges against him and sought for the disclosure of witnesses’ statements and documents.

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