Sep 17, 2010
Pay $250k as civil penalty
By Francis Chan, Companies Correspondent
Founder of Pheim Asset Management, Dr. Tan Chong Koay. -- PHOTO: PHEIM ASSET MGT
THE Singapore High Court has slapped a civil penalty of $250,000 plus legal costs on both a Malaysian-based asset management firm and its founder for rigging the share price of a firm listed here.
It found that Pheim Asset Management and founder Tan Chong Koay drove up the share price of Singapore-listed United Envirotech (UET) so it could make the performances of certain funds look better. The Monetary Authority of Singapore (MAS) claimed that Pheim initiated large trades of UET shares between Dec 29 and Dec 31 - the last trading days of 2004.
These transactions, which were done within the last half an hour of trading on each day, drove up UET's share price and gave the appearance of a false market. Shares of the China-based waste-water firm jumped 17 per cent over that period, mainly due to repeated purchases by a broker on behalf of Pheim.
Besides causing the share price to rise, those transactions accounted for 88 per cent of all trades carried out over those three days in UET shares. The sole aim of the trades was to set a higher market price for the shares. This 'window dressing' allowed certain funds managed by the Pheim group to outperform their respective benchmarks.
Read the full report in Saturday's edition of The Straits Times.
