This article first appeared in The Edge Malaysia Weekly on December 28, 2020 - January 3, 2021

WHAT was communicated in the 11-minute telephone conversation between Supermax Corp Bhd founder Datuk Seri Stanley Thai and his remisier Tiong Kiong Choon 13 years ago, and was it safe to convict the former of insider trading in APL Industries Bhd (APLI) shares based on what may have been said?

In September, the Kuala Lumpur High Court ruled that it was not safe, and acquitted him of insider trading.

On the same basis, judicial commissioner Datuk Azhar Abdul Hamid also reversed Tiong’s conviction by the Sessions Court three years ago.

Central to the issue before the court was Thai’s telephone call to Tiong and the 11-minute conversation between the men, which the Securities Commission Malaysia (SC) said resulted in the sale of APLI shares owned by his mother-in-law and mother, prior to APLI becoming a Practice Note 17 company.

Tiong’s lawyers Datuk Yusof Zainal Abiden and Datuk Chong Loong Meng maintained that the conversation may not have been related to APLI shares, as a sell directive could have been given in less than two minutes.

Thai’s counsel Shamsul Sulaiman agreed with Tiong’s lawyers. He insisted that there was no reason for his client to order the shares to be sold in large volumes, as it had resulted in huge losses. He also contended that it was wrong for the Sessions Court to order his client to enter his defence in the first place when there was insufficient evidence that the purported call pertained to insider information.

“There is no wire-tapping, no text messages to suggest so. The prosecution relied on circumstantial evidence and it was misleading to pinpoint the telephone conversation as a source of insider trading. Why the need for Thai to call the remisier twice, that is, on Sept 26 and, again, on Sept 29, 2007?” he said.

Thai was charged with communicating non-public information to Tiong between Oct 26 and 29, 2007. Tiong was convicted of two counts of disposing of a total of 6.21 million APLI shares while in possession of the non-public information via accounts belonging to Thai’s mother-in-law and mother.

Azhar agreed with the submissions and set aside the conviction, as “it was not safe”.

Earlier, the Sessions Court had sentenced Thai and Tiong to five years’ jail, and fined the accused RM5 million and RM10 million respectively.

Following their acquittal, the SC filed an appeal with the appellate court, which would be the final appeal, as the case originated in the Sessions Court.

Thai, who has 13 siblings, is now a billionaire because of his 37.2% stake in glove maker Supermax. In June, his net worth was estimated at RM3.7 billion compared with RM672.59 million at the end of last year. He had relinquished his positions in the company after he was charged.

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