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Introduction

In early March, the Monetary Authority of Singapore (MAS) issued prohibition orders  against four individuals, following their convictions for market misconduct offences. The four were among eight people charged for offences under the Securities and Futures Act (SFA). This was in relation to a scheme to commit false trading in the shares of Koyo International Limited, an engineering service provider listed on the Catalist board of the Singapore Exchange.

A Deep Dive

The court under the Monetary Authority of Singapore convicted the individuals and sentenced them to imprisonment terms ranging from three months to 20 months and 18 weeks. Under the MAS ban, they cannot provide financial advisory services, manage, act as a director, or become substantial shareholders of any licensed financial adviser under the Financial Advisers Act. Additionally, three of them are banned from carrying out regulated activities, managing, acting as a director, or becoming substantial shareholders of any capital market services licensee under the SFA. The court proceedings against the other four individuals are still ongoing.

The Monetary Authority of Singapore ban confirms Singapore’s focus on high standards of integrity and behaviour and also sends a clear message to the wider financial services world. It reflects the country’s status as a reputable international financial centre backed by consistent standards of financial regulation.The ban also highlights the role of the MAS in maintaining the reputation of the financial industry by regularly issuing compliance requirements and prohibition orders.  It is in line with the authority’s aim to step up its actions against financial misconduct and market abuse. This has recently involved increasing its focus on early detection of market misconduct, reducing the time it takes to complete reviews and investigations, imposing $3.3 million in composition penalties for money laundering-related control breaches and issuing 25 prohibition orders against unfit representatives.

The Impact

The prohibition orders issued by MAS are an important reminder for companies in Singapore and the wider financial services world to strive to meet all regulatory requirements and to prioritise compliance. They also illustrate the close scrutiny that regulatory bodies continue to apply to businesses. Financial authorities such as the MAS play an important part in enabling countries to maintain their reputation as a good place to do business by working preventatively to address potential issues alongside responding to cases like the one outlined above.

This recent case and the authority’s response highlight the importance of finance companies working to the highest standards for customers. Finance companies must also ensure they meet all regulatory requirements at every stage.  Failing to do so can result in significant damage to businesses and to consumer trust in the financial services industry.

Conclusion

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