On 3 September 2024, the Monetary Authority of Singapore (MAS) issued a five-year prohibition order (PO) against Mr. Chong Yew Mun Alan, a former representative of RHB Securities (Singapore) Pte. Ltd. The order was made following Mr. Chong’s conviction for market misconduct offences under the Securities and Futures Act (SFA), relating to false trading in the shares of Catalist-listed Koyo International Limited.
Between December 2015 and January 2016, Mr. Chong had participated in a scheme devised by Mr. Lin Eng Jue to create a misleading impression regarding the price of Koyo shares. Acting on Mr. Lin’s instructions, Mr. Chong traded Koyo shares in 15 different trading accounts using login credentials that were not his own. The brokerage firms involved were not aware of or had not consented to Mr. Chong’s trades being placed on behalf of the account holders, which contributed to the false appearance of rising share prices for Koyo.
The market-rigging activities culminated in Mr. Chong’s conviction in May 2023 for abetting Mr. Lin’s false trading and for deceiving several brokerage firms by using unauthorized trading accounts. On 13 July 2023, Mr. Chong was sentenced to 11 weeks’ imprisonment for his role in the scheme. The misconduct has led MAS to conclude that he is not fit to perform roles within the financial advisory and capital markets sectors.
As part of the prohibition order, Mr. Chong is barred from providing financial advisory services, managing, acting as a director, or becoming a substantial shareholder of any financial advisory firm under the Financial Advisers Act. Similarly, he is prohibited from performing regulated activities or participating in the management or ownership of capital market services firms under the SFA.
The prohibition order against Mr. Chong is part of a broader investigation that has seen eight individuals convicted for their roles in a market manipulation scheme designed to artificially inflate the share price of Koyo International. The scheme, orchestrated by Mr. Lin Eng Jue, involved the manipulation of 53 trading accounts opened in the names of 15 individuals. Between August 2014 and January 2016, Mr. Lin and his associates executed a series of trades to gradually drive up the price of Koyo shares, peaking at $0.40 on 14 January 2016, with the aim of attracting a buyer for the company through a reverse takeover.
However, the fraudulent nature of the trades was exposed after the Singapore Exchange Securities Trading Limited (SGX-ST) issued a “Trade with Caution” alert due to unusual trading activities. As trading curbs were imposed by several brokerages, Koyo’s share price plummeted to $0.056 by 18 January 2016. The scheme resulted in losses of approximately $3.28 million for account holders, with brokerages and remisiers bearing $1.05 million of those losses.
Mr. Chong, along with three other individuals—Mr. Ang Wei Jie Simon, Ms. Koh Cheo Leng, and Mr. Lin Eng Jue—was convicted for their involvement in the scheme. They were sentenced to imprisonment terms ranging from 11 weeks to 42 months. Mr. Lin, as the mastermind of the operation, received the heaviest sentence of 42 months.
Ms. Loo Siew Yee, Assistant Managing Director of MAS, emphasized the gravity of the situation, stating, “The convicted individuals executed a sophisticated market-rigging scheme that resulted in severe market distortion over a prolonged period and significant losses to market participants. MAS will act firmly against such egregious misconduct to preserve the integrity of our capital markets.”
As the prohibition order against Mr. Chong takes effect, it serves as a clear warning that individuals found engaging in deceptive market practices will face severe consequences, including criminal prosecution and disqualification from the financial services sector. MAS continues to collaborate with regulatory and enforcement bodies to ensure a fair and transparent financial market environment in Singapore.
