http://www.todayonline.com/Comment/EDC100217-0000033/Gambling-started-two-weeks-ago
Gambling started two weeks ago
by Conrad Raj
Updated 03:20 PM Feb 17, 2010
Last Sunday, on the first day of the Chinese New Year, as the doors to Singapore's first casino were thrown open at the auspicious time of 12.18pm, thousands of gamblers poured into Resorts World Sentosa (RWS) to place bets at the gaming tables and slot machines.
But in reality, the gambling had begun almost two weeks earlier, with bets hitting a high on the first Friday in February.
On that fateful Friday, well against the tide of the general market, shares of Genting Singapore, the main shareholder of RWS, put on a strong showing. When contacted, an RWS spokesman had no comment, except to say that the casino was "on track to open in the first quarter of 2010".
Less than 24 hours later, on Saturday, RWS announced that it had received its casino licence from the Casino Regulatory Authority.
The day before, Genting Singapore shares rose more than 9 per cent in intra-day trade to a high of $1.18 with a hefty 276.96 million shares changing hands, three times the average daily volume of that week, making it the day's most heavily traded stock.
The stock closed up 2.78 per cent, on a day when most other counters on the Singapore Exchange (SGX) were ripped to shreds as the Straits Times Index (STI) lost 2.24 per cent. It was the only gainer among the STI's 30 component stocks. Clearly, some punters won big even before the licence announcement, and well before the casino doors opened.
Yet, more than a week later, the counter has not attracted a single query from the Exchange, at least publicly. Many observers, including to those of us in the newsroom who had been waiting for news about when the casino would open, wonder if a leak fuelled the Friday frenzy.
Publicly, the SGX appears to have ignored the matter thus far. Perhaps the Exchange does not want to be a killjoy. But how does this square with the tough stance taken by the authorities, especially in recent times, towards possible insider trading and market manipulation.
At the end of last year, Aspial Corporation's chief executive officer became the latest of a long line of people being investigated for possible infringements of Section 218 of the Securities and Futures Act which deals with insider trading. And just a couple of months ago, the Exchange in its Regulator's Column had advised market traders to pay more attention when handling large orders in an effort to prevent share manipulation.
While traders were free to employ different trading strategies, the Exchange pointed out: "However, large orders entered within a short span of time, especially at prices above or below the prevailing spread, have a greater potential to create price dislocation."
Shouldn't Genting Singapore's extraordinary volume and price movements on Feb 5 have rung alarm bells? There may be nothing to it, but any abnormal activity ought to be checked, lest the man in the street is misled.
Several jurisdictions, such as Britain and Australia, have in the last 12 months toughened the rules on insider trading. While Britain provides immunity to whistle blowers on insider trading, Australia has made insider trading a crime almost as serious as murder and drug trafficking.
The authorities here have the choice of either criminal or civil action. Perhaps it is time to send a stronger signal against insider trading.
While I congratulate Genting Singapore for getting its casino up and running, I hope the authorities will take a closer look at the events of Feb 5. All major trading discrepancies deserve close scrutiny if market manipulation is to be stamped out, or at least brought under control.
Gambling started two weeks ago
by Conrad Raj
Updated 03:20 PM Feb 17, 2010
Last Sunday, on the first day of the Chinese New Year, as the doors to Singapore's first casino were thrown open at the auspicious time of 12.18pm, thousands of gamblers poured into Resorts World Sentosa (RWS) to place bets at the gaming tables and slot machines.
But in reality, the gambling had begun almost two weeks earlier, with bets hitting a high on the first Friday in February.
On that fateful Friday, well against the tide of the general market, shares of Genting Singapore, the main shareholder of RWS, put on a strong showing. When contacted, an RWS spokesman had no comment, except to say that the casino was "on track to open in the first quarter of 2010".
Less than 24 hours later, on Saturday, RWS announced that it had received its casino licence from the Casino Regulatory Authority.
The day before, Genting Singapore shares rose more than 9 per cent in intra-day trade to a high of $1.18 with a hefty 276.96 million shares changing hands, three times the average daily volume of that week, making it the day's most heavily traded stock.
The stock closed up 2.78 per cent, on a day when most other counters on the Singapore Exchange (SGX) were ripped to shreds as the Straits Times Index (STI) lost 2.24 per cent. It was the only gainer among the STI's 30 component stocks. Clearly, some punters won big even before the licence announcement, and well before the casino doors opened.
Yet, more than a week later, the counter has not attracted a single query from the Exchange, at least publicly. Many observers, including to those of us in the newsroom who had been waiting for news about when the casino would open, wonder if a leak fuelled the Friday frenzy.
Publicly, the SGX appears to have ignored the matter thus far. Perhaps the Exchange does not want to be a killjoy. But how does this square with the tough stance taken by the authorities, especially in recent times, towards possible insider trading and market manipulation.
At the end of last year, Aspial Corporation's chief executive officer became the latest of a long line of people being investigated for possible infringements of Section 218 of the Securities and Futures Act which deals with insider trading. And just a couple of months ago, the Exchange in its Regulator's Column had advised market traders to pay more attention when handling large orders in an effort to prevent share manipulation.
While traders were free to employ different trading strategies, the Exchange pointed out: "However, large orders entered within a short span of time, especially at prices above or below the prevailing spread, have a greater potential to create price dislocation."
Shouldn't Genting Singapore's extraordinary volume and price movements on Feb 5 have rung alarm bells? There may be nothing to it, but any abnormal activity ought to be checked, lest the man in the street is misled.
Several jurisdictions, such as Britain and Australia, have in the last 12 months toughened the rules on insider trading. While Britain provides immunity to whistle blowers on insider trading, Australia has made insider trading a crime almost as serious as murder and drug trafficking.
The authorities here have the choice of either criminal or civil action. Perhaps it is time to send a stronger signal against insider trading.
While I congratulate Genting Singapore for getting its casino up and running, I hope the authorities will take a closer look at the events of Feb 5. All major trading discrepancies deserve close scrutiny if market manipulation is to be stamped out, or at least brought under control.
