FIFTEEN months after Singapore’s momentous penny stock crash on Oct 4, 2013, there are more questions than answers on what actually led to the stocks’ precipitous rise and fall.
The combined market capitalisation of the three penny stocks — Asiasons Capital Ltd, Blumont Group Ltd and LionGold Corp Ltd — linked to a handful of smaller counters and several prominent Malaysian individuals in a web of cross-shareholdings and directorships, had whittled down to S$98.98 million as at Dec 16. That is less than 1% of the S$11 billion the trio commanded at their peak just days before the epic crash that resulted in the Singapore Exchange introducing circuit breakers as an additional safeguard against disorderly trading on Feb 24 this year and nudging broking houses to rein in margin accounts.
In August, AmBank Group’s Singapore stockbroking unit, Amfraser Securities, which is believed to have been among the hardest hit by the rout and needed a cash infusion from its parent, was sold for S$38 million to KGI Group, the securities arm of Taiwanese merchant bank China Development Financial Holdings Corp.
The year bore witness to a landmark probe by Singapore’s white collar crime busters on suspected trading irregularities. Following an April 2 statement by the Monetary Authority of Singapore, the Commercial Affairs Department (CAD) asked at least seven companies — Blumont, LionGold, Innopac Holdings Ltd, Magnus Energy Group Ltd, IPCO International Ltd, ISR Capital Ltd and ITE Electric Co Ltd – to assist in the investigations. Dealers were among the 70 people hauled up for questioning, The Edge Singapore reported in September, but little light has been shed on who is accountable for the fiasco.
Except for IPCO, all other companies linked to the penny stock rout were loss-making as at their latest cumulative reporting periods. It remains to be seen if the companies can move past the episode. - by Cindy Yeap
John Soh Chee Wen
Businessman
Soh is reportedly among those who were asked to assist in the CAD’s investigations. He is adviser to LionGold’s chairman Tan Sri Nik Ibrahim Kamil but “does not attend any of the company’s board meetings and does not receive any remuneration from LionGold”, according to a Sept 2 LionGold statement. Nik Ibrahim is also a director of Westports Holdings Bhd, former managing director of The New Straits Times Press (M) Bhd and former chairman of Southern Investment Bank Bhd.
Last year, Soh’s name appeared alongside those of former Blumont chairman Neo Kim Hock, Ipco CEO Quah Su-Ling (who in November 2013 sued Goldman Sachs for allegedly wrongfully force-selling her shares), Innopac CEO Wong Chin Yong and LionGold director Peter Chen Hing Woon in a lawsuit in Singapore over several deals that had gone sour.
In Malaysia, Soh, who was charged with securities fraud in 2002, was fined a total of RM6 million in May 2007 after he pleaded guilty to two alternative charges of abetting the submission of false information to the then Kuala Lumpur Stock Exchange.
Datuk Jared Lim Chih Li
Co-founder and managing director, Asiasons
Unlike their counterparts in the other affected companies, Asiasons’ directors and officers were not asked to assist in CAD’s investigations. Lim is married to Dian Lee, daughter of Malaysian property tycoon and Country Heights Holdings Bhd founder Tan Sri Lee Kim Yew and heads Clearwater Developments, which has a stake in Blumont. He is also a director of Chaswood Resources Holdings Ltd, a restaurant operator.
Datuk Mohammed Azlan Hashim
Co-founder, Asiasons
Azlan retired as non-executive chairman of Asiasons at the conclusion of the company’s AGM on April 28 this year. On the company’s website, he is lauded as “the senior statesman in the partnership” and was instrumental in building its relationships with government authorities and large corporates across the region.
The former executive chairman of the KLSE also served as group chief executive of Bumiputra Merchant Bankers, group managing director of Amanah Capital Malaysia Bhd and chairman of Proton Holdings Bhd.
Ng Teck Wah
Co-founder, Asiasons
Ng retired as a joint-managing director of Asiasons on the same day as Azlan but remains a substantial shareholder. He has 25 years of experience in consultancy, turnaround management, mergers and acquisitions and transaction advisory. He has worked at Arthur Andersen and EY.
Datuk Md Wira Dani Abdul Daim
Executive deputy chairman of LionGold
Wira Dani is the son of former finance minister Tun Daim Zainuddin. He was re-elected as LionGold’s executive deputy chairman at the company’s AGM on Nov 19. He sits on the board of Magnus Energy and is chairman of ISR Capital.
This article first appeared in The Edge Malaysia Weekly, on 22 - 28 December 2014.
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