Individuals Charged in Relation to Insider Trading in Singapore


The Monetary Authority of Singapore (MAS) released a press release stating that three individuals were charged for illegally communicating non-public and material information and using such information to buy shares in a company. The investigation was jointly conducted by the Monetary Authority of Singapore and the Commercial Affairs Department of the Singapore Police Force.

This case dates back to 2016 when the former CFO of SGX-listed Broadway Industrial Group communicated insider information to two other individuals, Mr Tay Yew Khem (Mr Tay) and Ms Hui Choy Leng (Ms Hui). Mr Tay and Ms Hui are accused of purchasing BIGL shares while in possession of insider information. In addition, the investigation found that Mr Tan received an amount of $30,000 from Mr Tay as a payment for the insider information.

The offence of insider trading is punishable under the Securities and Futures Act (SFA), and if convicted, the three individuals will face charges such as the imprisonment of a maximum of 10 years and/or a fine of up to $500,000.

Countries Approach to Combat Insider Trading

In the world of trading, having the right information and using it quickly can make traders gain an edge. However, in many cases, having that information before everyone else and using it to trade is considered illegal insider trading. The practice of using confidential information to gain market advantage and profit is forbidden and leads to serious punishment for individuals and firms.

Countries such as Singapore, Australia, the United States of America, the United Kingdom, India, among others, have strict rules around illegal insider trading and the protection of material non-public information (MNPI). Regulations differ, but they all have the same aim: combating individuals from taking market advantage when in possession of confidential information.

There are some recent updates on regulatory enforcement around the topic. For example, in the US, the new SEC Chair, Gary Gensler, recently gave a speech talking about his plan to “freshen up” Rule 10b5-1, which will lead to more enforcement action around material non-public information (MNPI) and insider trading. You can read more on the topic on our blog, “Proposed Rule 10b5-1 Changes Signal Increased MNPI Scrutiny”.

In the United Kingdom and Europe, the European Market Abuse Regulation (MAR) was implemented in 2016 to make trading activities more transparent and combat insider trading. Since then, many firms and individuals have been under investigation by FCA for committing market abuse and manipulating transactions.

The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, published a MAR Review report with recommendations for firms regarding processes and controls for managing insider lists and protecting MNPI while protecting the firm from fines and reputational damage.

The Australian insider trading laws or the Corporations Act 2001 explicitly makes it an offence for individuals with inside information to trade or communicate that information for a third person to trade with. The Australian Securities & Investments Commission cracked the biggest insider trading case when they arrested former NAB banker Lukas Kamay and former Australian Bureau of Statistics (ABS) analyst Christopher Hill.

In India, the Securities and Exchange Board of India has recently amended and updated its Regulations related to the Prohibition of Insider Trading, to enhance compliance, reporting and enforcement related to access to material non-public information as well.

In Singapore, in a recently published consultation paper, MAS affirms its intention to redefine the present approach towards insider trading laws and states that the present approach is reducing the effectiveness of insider trading laws in Singapore.

The proposed changes show the regulators commitment to improving market integrity and their efforts to tackle market abuse. The consultation paper works as an alert for firms of upcoming investigations and enforcement actions in the region.

These recent updates mean that firms should be aware of securities listed in Singapore and overseas as MAS will pursue offenders who commit misconduct in other countries. An example of this is the 2019 case, where MAS imposed a civil penalty of $336,000 on Mr Tham Wai Mun Raphael for insider trading of shares listed in the United Kingdom. In this case, MAS worked with the Financial Conduct Authority (FCA) during the investigation and to charge the offender.

Protecting Your Firm and Safeguarding MNPI

Regulators are heavily pressuring companies, especially financial institutions, to comply with market abuse regulations. Authorities are alerting companies about the importance of having robust systems and controls to manage insider lists and protect MNPI. It’s crucial for firms and individuals to be fully aware of what constitutes a Market Abuse offence, understand the regulation and that the improper use of inside information can lead to fines, administrative sanctions, and reputation damage.

MyComplianceOffice has a solution for firms to manage insider lists and protect MNPI with the correct procedure for the dissemination of information. Our solution enables firms to create insider lists, complete with individuals and roles/rights assignments, timeframes when individuals can access inside information, as well as a cross-referenceable hierarchical database of securities listings and company information on tens of thousands of entities.

If you would like to know more about the MyComplianceOffice Insider & MNPI Management module, reach out to our team. We’ll be happy to show you how the solution works and how it can help your firm comply with securities laws and regulations.