IN a public statement yesterday, the Securities Commission (SC) said it had concluded an inquiry into the trading transactions of the MACC chief and that based on the evidence, it was not able to conclusively establish that Azam Baki had breached section 25(4) of the Securities Industry (Central Depositories) Act 1991.

If the SC was not able to conclusively establish a breach of the law even after Azam had admitted in a press conference that he had allowed his brother to borrow his CDS account to purchase shares, on what basis was the authority able to establish that Surinder Kaur Jessy Piara Singh had allowed Kanesan Veluppillai to use her CDS account at Arab-Malaysian Securities Sdn Bhd (now known as AmInvestment Bank Bhd) to trade in Nexnews Bhd shares in 2007? She was fined RM25,000 for the offence. Unlike the anti-corruption chief,  Surinder was unlikely to have admitted publicly that she had allowed Kanesan to use her CDS account.

While the SC said in its statement that the matter was investigated under section 25(4), why was the case not investigated concurrently under section 29A of the same act, which states that
all dealings in respect of deposited securities shall only be effected by the beneficial owners of such deposited securities or an authorised nominee, as the case may be?

In another case, Daniel Yong Chen-I was charged under section 29A for allowing Ng Ee Fang, who was the head of equity derivatives at AmInvest and also his wife, to effect the acquisition of one million units of Hirotako shares in 2011 through his account. Ng was also charged with four counts of insider trading in connection with the acquisition.

Azuzay Zamani, who held an account at OSK Investment Bank, was another person charged under section 29A for allowing Mohd Nor Abdul Wahid to effect the acquisition of 500,000 share units of Three-A Resources Bhd in 2009. Mohd Nor was charged under section 188(2)(a) of the Capital Markets and Services Act 2007 for acquiring the shares through Azuzay Zamani’s CDS account.

By admitting that it was not able to conclusively establish a breach when the person under investigation had openly admitted to the offence, it appears that the SC has effectively stripped itself of the authority to prosecute offenders deemed to have breached section 25(4) .

Will we see a rise in people using their securities account to trade on behalf of their relatives, friends and others, whether for a fee or for free, effectively wiping out all previous efforts carried out by SC themselves to curb broadside speculative activities prevalent in the capital market previously?

Surinder, Yong and Azuzay deserve an answer. It will be a great injustice to each of them if none is forthcoming. – January 19, 2022.

* FLK reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.