MAS fines two Wilmar execs for insider trading

SINGAPORE - The Monetary Authority of Singapore (MAS) has taken civil penalty enforcement action against two employees of Wilmar International for insider trading.

The action against Goh Ing Sing and Keu Haw Gee under Section 219(2)(a) of the Securities and Futures Act (SFA) was for an insider trading offence committed in 2010.

MAS said in a statement that on Aug 13, 2010, Wilmar announced its intention to purchase 20 per cent of the share capital of Kencana Agri Limited, a company listed on Singapore Exchange (SGX), at $0.35 per share.

After the release of the announcement, Kencana's share price closed at $0.385, up 10 per cent from the previous day's closing price of $0.35.

Mr Goh and Mr Keu, group plantation head and the plantation head of Wilmar respectively, were involved in the due diligence exercise conducted by Wilmar on Kencana's plantations prior to the announcement.

The MAS said that while in possession of non-public price sensitive information concerning Wilmar's intention to invest in Kencana, Mr Goh and Mr Keu bought 626,000 and 50,000 Kencana shares respectively, on Aug 5 and Aug 6 of 2010.

As a result of their purchases, Mr Goh and Mr Keu made respective profits of about $43,000 and $2,000.

Mr Goh and Mr Keu have admitted to contravening Section 219(2)(a) of the SFA and have paid to MAS civil penalties of $110,000 and $50,000 respectively, without court action.

The matter was referred to MAS by SGX.

In a separate statement issued yesterday, Wilmar said that while "it takes a serious view of the matter and regrets that it has happened", the company had decided to retain the services of both Goh and Keu.

Wilmar's board reassured shareholders and investors that the company was committed to upholding high standards of corporate governance and that measures had been put in place in this regard, including reminding directors and employees to observe insider trading laws at all times.

The decision to retain both executives' services was based on several factors.

First, both Mr Goh and Mr Keu are based in Indonesia, where the scope of their responsibilities lies only in the day-to-day operations of the company's plantations and are not involved in its corporate affairs.

Further, the experience and technical knowledge of both men tilted the balance in their favour as Mr Goh, who has spent more than 20 years in the company, and Mr Keu, who has served eight years at Wilmar, are deemed to have made great contributions to the development of the group's plantation business and can continue to do so, Wilmar said.