KUALA LUMPUR (March 18): The Securities Commission Malaysia (SC) has warned public-listed companies (PLCs), regulated entities and the media against the dissemination of false or misleading information, as it is a very serious breach under the securities law.
In response to a question on the actions the regulator could take against parties that make misleading statements, especially in relation to Covid-19 vaccines, SC chairman Datuk Syed Zaid Albar said the parties must exercise diligence.
“All listed entities, directors and CEOs must exercise care and diligence when making any material announcements and above all, maintain accountability.
“The SC and Bursa Malaysia have taken various actions against PLCs and directors for offences such as insufficient and inaccurate disclosures by PLCs. Any person who is found guilty may face imprisonment not exceeding 10 years and a fine of no less than RM1 million,” he said in a virtual conference today.
On the rise in retail trading activity and the presence of social media chat groups set up by traders, Syed Zaid said the SC and Bursa Malaysia have been closely monitoring these activities to “ensure an efficient, fair and orderly market”.
He said the chat groups “never really catch on” and said the market dynamics in Malaysia is different from the US, which saw the pumping of GameStop Corp’s shares led by participants of online forums.
“In fact, we welcome retail participation in the equity market — the presence of a more diverse group of investors can create a healthy, active and vibrant marketplace,” he said.
He pointed out that local investors made up 32.4% of the total value traded in the stock market, which is significantly higher than the five-year average of 21.4%.
However, Syed Zaid warned investors, reminding them to make informed decisions when trading, and added that traders must be cognisant of the risks and opportunities involved.
“Be cautious of social media chat rooms that try to influence investors to buy or sell certain stocks based on speculation or rumours. Please do trade on fundamentals and not be swayed by rumours or FOMO — fear of missing out.
He also touched on the presence of politicians on the boards of PLCs, saying that shareholders need to exercise their rights in ensuring that only persons who are fit, proper and can contribute to the growth of the company are appointed to the board.
Meanwhile, Syed Zaid said PLCs should be guided by the Organisation for Economic Co-operation and Development (OECD)’s corporate governance principles for state-owned enterprises, which says that persons linked with executive powers such as heads of state and ministers should not serve on boards as it may cast doubts on independence.