KUALA LUMPUR (Sept 8): Bursa Malaysia Securities Bhd has fined Teo Chee Cheong RM74,500 with a 10-month trading suspension for engaging in manipulative trading activities involving shares in eight companies.
According to a statement by Bursa Securities, Teo had manipulated order book of the securities over a period of about one year when he was a proprietary day trader at TA Securities Holdings Bhd.
Teo, the regulator said, had placed buy orders "at multiple price levels" in quantities of 200,000 to 500,000 units per order, at or near the best bid prices in short intervals, which controlled the buy side of the order books.
This had induced other market participants into the market. The participants bid at higher prices or queued at Teo's facilitated price levels, after which he would cancel the buy orders and turn seller to dispose of his outstanding shares at the higher prices.
The process gave rise to the misleading appearance of strong demand for the relevant counters, and the cancellations indicated that he did not intend to buy these shares, the statement added.
The eight counters were Malaysia Building Society Bhd, Dagang NeXchange Bhd, Hibiscus Petroleum Bhd, Dagang NeXchange Bhd warrants, Johan Holdings Bhd, Sapura Energy Bhd, UMW Oil & Gas Corp Bhd (now Velesto Energy Bhd) and Sino Hua-An International Bhd.
"Despite trading concerns raised by Bursa Malaysia Securities and actions by TA (including instructions to cease his false market/manipulative trading activities and a suspension imposed by TA), Teo continued engaging in the [activities involving] more counters.
"Teo only stopped the false market/manipulative trading activities after a reminder was issued by Bursa Malaysia Securities and another suspension by TA," the statement added.
Aside from the reprimand, Teo will also be required to undergo training on conduct or professionalism of dealers' representatives.
Teo, the regulator said, had contravened and/or triggered the provisions of Rules 3.14(d), (e) & (g) and 5.01(b) of the Rules of Bursa Malaysia Securities and paragraph 1.1(1)(h) of Directives No 5-001 of the Participating Organisation Directives and Guidance.
The rules stated, among others, that a registered person must not do anything which may result in the market not being orderly and fair, and that the person must not engage in a practice that might lead to misleading appearance of active trading in any securities in the market.