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KUALA LUMPUR (8 September): Bursa Malaysia Securities Bhd has fined Teo Chee Cheong RM74,500 with a 10-month commercial suspension for engaging in manipulative trading activities involving shares of eight companies.
According to a statement from Bursa Securities, Teo had manipulated the order book for the securities over a period of approximately one year when he was the proprietary intraday trader at TA Securities Holdings Bhd.
Teo, the regulator said, had placed purchase 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 to enter the market. Participants bid higher prices or queued at the price levels provided by Teo, after which he canceled the purchase orders and made the seller dispose of his outstanding shares at higher prices.
The process resulted in the deceptive appearance of strong demand from the relevant accountants, and the cancellations indicated that it had no intention of buying 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 business concerns raised by Bursa Malaysia Securities and TA’s actions (including instructions to cease its false / manipulative business activities and a suspension imposed by TA), Teo continued to participate in the [activities involving] more counters.
“Teo only stopped the false / market manipulative trading activities after Bursa Malaysia Securities issued a reminder and TA another suspension,” the statement added.
In addition to the reprimand, Tim should also receive training on the conduct or professionalism of dealer representatives.
Teo, said the regulator, had violated and / or activated the provisions of Rules 3.14 (d), (e) and (g) and 5.01 (b) of the Bursa Malaysia Securities Rules and paragraph 1.1 (1) (h ) of Directives No. 5-001 of the Directives and Orientations of the Participating Organizations.
The rules established, among other things, that a registered person must not do anything that could result in the market not being orderly and fair, and that the person must not engage in a practice that could lead to a deceptive appearance of active trading of values in the market.
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