Court Of Appeal Upholds RM1.24 Million Order Against Former Patimas Director For Insider Trading

KUALA LUMPUR, Sept 2 (Bernama) -- The Court of Appeal today upheld the High Court’s decision ordering former Patimas Computers executive director Datuk Ng Back Heang to pay RM1.24 million to the Securities Commission (SC) after he was found liable for insider trading.

According to an SC statement today, a three-member Court of Appeal bench comprising Justices Datuk Ravinthran N. Paramaguru, Datuk Dr Choo Kah Sing and Datuk Nadzarin Wok Nordin, in a unanimous decision, dismissed Ng’s appeal with costs of RM30,000.

The SC said the High Court here in 2022 had found Ng liable for insider trading under Section 188(2)(a) of the Capital Markets and Services Act 2007 (CMSA).

“The Court of Appeal upheld the High Court’s judgment ordering Ng to pay RM1.24 million to the SC, equivalent to three times the amount of losses he avoided as a result of insider trading.

“Ng was also ordered to pay a civil penalty of RM700,000 to the SC and barred from being appointed as a director of any listed company for five years, effective from the date of the High Court judgment on Nov 17, 2022. The High Court also awarded RM100,000 in costs to the SC,” it said.

The statement said the breach occurred when Ng disposed of 16.5 million Patimas shares he owned between May and July 2012 while in possession of material non-public information relating to audit queries and issues concerning suspicious transactions between Patimas and its major debtors.

“The matter had been raised and discussed by Patimas’ external auditors during meetings with the company’s management,” the statement said.

According to the SC, on July 31, 2012, the Patimas board of directors announced to Bursa Malaysia that the company would not be able to issue its Audited Annual Financial Statements for the financial period from Jan 1, 2011, to March 31, 2012, due to unresolved significant audit findings or queries.

The statement said insider trading was a serious breach as it undermined the integrity of the capital market and consequently eroded investor confidence in the stock market, and the Court of Appeal’s decision reinforced that such violations would not be tolerated by the SC and the courts.

The case was handled by SC deputy public prosecutors Mohd Hafiz Mohd Yusoff, Mageswary Karroppiah, Eunice Ong Jo Xing and the SC’s appointed external counsel, while Ng was represented by lawyer Datuk Jasbeer Singh.

-- BERNAMA