KUALA LUMPUR (June 1): The Securities Commission Malaysia (SC) has filed a suit against WCT Holdings Bhd deputy managing director Goh Ching Liong for insider trading in shares of WCT Bhd, which has been delisted in July 2013 after a restructuring that transferred operations into the current listed outfit.

In a statement today, SC said it has filed suit against Goh and two other individuals namely Chan Soon Huat and Leong Ah Chai for the abovementioned allegation.

Goh is alleged to have communicated the material non-public information to Leong who had thereafter disposed of the said WCT Bhd shares. This is in breach of section 188(3) of the Capital Markets and Services Act 2007 (CMSA).

According to the SC, the information was related to the cancellation of a contract for the proposed construction of Nad Al Sheba Dubai Racecourse in the Emirate of Dubai, United Arab Emirates. The contract was awarded to a joint-venture company set up by WCT Bhd and Arabtec Construction LLC.

SC alleged Leong for breaching section 188(2) of the CMSA, by disposing 1,640,000 units of WCT Bhd shares between Jan 2 and Jan 5, 2009.

Chan, on the other hand, was alleged to have breached the same law by disposing a total of 2,414,600 WCT Bhd shares and 1,236,700 WCT Bhd warrants between Dec 30, 2008 and Jan 5, 2009.

The announcement on the cancellation of the contract was only made on Jan 6, 2009.

“Chan is said to have disposed the WCT [Bhd] shares and warrants through his own account and also the account of his daughter, Chan Choon Chew and his son-in-law, Leong Weng Wah,” SC said.

“The SC is seeking a disgorgement of three times the profits earned by the defendants as a result of the insider trading. The SC is also claiming a civil penalty of RM1 million from each of the three defendants and that the defendants be barred from being a director of a public listed company,” it added.

WCT Holdings (fundamental: 0.6; valuation: 1.4) closed down four sen or 2.35% to RM1.66 per share today, with a market capitalisation of RM1.83 billion.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)