SC sues lawyer for in­sider trad­ing

The Sun (Malaysia) - - SPEAK UP -

PETALING JAYA: Se­cu­ri­ties Com­mis­sion Malaysia (SC) has filed a civil suit at the Kuala Lumpur High Court against Datuk Sreesan­than Eliathamby for in­sider trad­ing in­volv­ing the shares of World­wide Hold­ings Bhd.

The reg­u­la­tor said in a state­ment that Sreesan­than had breached Section 89E(2)(a) of the Se­cu­ri­ties In­dus­try Act 1983 (SIA), whereby he ac­quired a to­tal of 600,000 of World­wide shares be­tween June 7, 2006 and Sept 15, 2006, while in pos­ses­sion of ma­te­rial non­pub­lic in­for­ma­tion.

At the ma­te­rial time, Sreesan­than was a se­nior part­ner in a law firm which was en­gaged to act as the le­gal ad­viser of the pro­posed pri­vati­sa­tion of World­wide.

The SC con­tended that the ma­te­rial in­for­ma­tion re­ferred to in the ac­tion was re­lated to the pri­vati­sa­tion of World­wide by way of a mem­ber’s scheme of ar­range­ment un­der Section 176 of the Com­pa­nies Act 1965 un­der­taken by Per­badanan Ke­ma­juan Negeri Se­lan­gor (state de­vel­op­ment agency). The pri­vati­sa­tion ex­er­cise was an­nounced on Aug 23, 2006.

The SC is seek­ing, among oth­ers, a dis­gorge­ment of RM1.99 mil­lion, which is three times the prof­its al­leged to have been made by the de­fen­dant as a re­sult of the breach, a civil penalty of RM1 mil­lion and an or­der to bar the de­fen­dant from be­ing ap­pointed a direc­tor in any pub­li­clisted com­pany for 10 years.

Worth not­ing is that SC had also in 2012 charged Sreesan­than with seven counts of in­sider trad­ing in the shares of four dif­fer­ent stocks, namely Sime Darby Bhd, Maxis Com­mu­ni­ca­tions Bhd, UEM World Bhd and VADS Bhd.

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