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Masamune Date
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May 30, 2011
Trader admits manipulating price of warrants
By Khushwant Singh
Sim Tee Yang, 44 yrs-old faces 12 charges for creating a false or misleading appearance with respect to the price of CapitaMall trust (CMTW) traded on the Singapore Exchange Securities Trading Ltd (SGX). -- ST PHOTO: WONG KWAI CHOW
A TRADER with CIMB-GK Securities pleaded guilty on Monday to manipulating the price of a CapitaMall warrant (CMTW). Sim Tee Yang, 44, will be sentenced on June 21.
A district court heard that Sim has been a proprietary trader since 1994. Profits and losses would be shared equally between Sim and CIMB-GK.
Since CapitaMall Trust (CMT) was trading at a significantly higher price than the CMTW strike price of $1.809 for its conversion from a warrant into a share, Sim knew that the price of the warrants was very dependent and sensitive to the price of CMT shares.
By trading in both counters simultaneously between May and August 2005, he made a gain of $25,209 on his trades on CMTW while sustaining a loss of $8,697 trading in CMT.
In one instance within a training day, he made a loss of $1,383 trading in CMT and a profit of $5,222 in the warrants. He did this trick again on 11 other days.
Sim pleaded guilty to four counts with eight charges to be taken into consideration by District Judge Toh Yung Cheong for sentencing.
