SINGAPORE (Oct 5): While retail investors are growing more savvy at navigating the local stock market and asking companies tough questions, they are now worried about litigation.

At a Sept 28 investors’ forum organised by the Securities Investors Association (Singapore) (SIAS), the risk of being sued for defamation was evidently on the minds of many people.

Investors who attended the event were not coy in voicing their concerns about the state of the local market, although some were careful when making comments about specific companies.

For instance, one investor declined to even name the company he was griping about, citing the fear of a lawsuit.

Another stopped short of faulting the company’s auditor for failing to spot fraudulent activity, quickly saying, “I don’t want to be sued.” One irate investor threw caution to the wind, claiming that he had little to his name that a company could sue him for anyway.

Shareholders would ordinarily be thought to enjoy “qualified privilege” in meetings, such as annual general meetings (AGMs). But they can get into trouble when they choose to make comments in public, or through social media channels. 

In July, Asiatic Group (Holdings) sent a cease-and-desist letter to one of its shareholders, Jerry Low, for alleged defamatory statements about the company. Asiatic dropped the matter after Low removed statements he had posted online.

Then, on Sept 9, Stamford Land Corp announced a lawsuit against shareholder Mano Sabnani – once editor-in-chief of The Business Times and Today – for allegedly making defamatory statements during the company’s AGMs in 2016 and 2018, on social media and in a letter to the press. 

“If someone as well-known as Mano can be sued, what about the rest of us?” asks an investor who has tracked many mid- and small-cap stocks over the last three decades.

This week in our cover story of The Edge Singapore issue 851 (week of Oct 8), we discuss the legal grievances retail investors face while trying to exercise their rights as shareholders of publicly-listed companies, and whether anything can be done to prevent shareholders from being silenced by the threat of legal action. Click here to read the full story or subscribe today.