SINGAPORE (Oct 31): The prosecution in the trial of alleged 2013 penny stock crash masterminds John Soh Chee Wen and Quah Su-Ling has made applications to cross examine former Phillip Securities remisier Joe Tiong Sing Fatt as a “hostile witness”.

A hostile witness is one who deviates from prior statements made to law enforcement officers and gives evidence favouring the accused persons.

Taking the stand this week, Tiong had proven to have been an uncooperative witness.

Justice Hoo Sheau Peng has approved the application.

However, Hoo said she would rule only at the end of the trial whether to allow the prosecution’s other application, which was to impeach Tiong’s credibility as a witness.

Tiong is the final witness in this second tranche of the trial. The third tranche of the trial is expected to commence on Jan 2, 2020.

More ties revealed

In response to questions from deputy public prosecutor Nicholas Tan, Tiong on Thursday continued to give vague answers such as “I don’t know” or “I can’t remember.”

Tan grilled Tiong about the accounts of Ludovic and one James Brownsea. Tiong had claimed that he mimicked the orders of Ooi Kwee Seah and Chong Kwan Lin on both these accounts.

While orders were placed in Ooi’s and Chong’s accounts after a call from a number that other witnesses have identified as used by Soh, Tiong had also placed orders in the accounts of Ludovic and Brownsea. In some instances, Tiong also did not give priority to the caller.

The court also heard more details of ties between Tiong and Quah, the co-accused whom he had earlier claimed he had met only once before at a corporate function.

Tiong admitted on Thursday that he had been to Quah’s residence before. It was also revealed that another broker, Wong Xu Yue, was also present at Quah’s house. It was also then that Tiong first met the co-accused’s sister, Quah Su-Yin.

Tiong and Wong had also discussed each other’s losses. However, Tiong claimed that he did not know the exact cause of Wong’s losses, except that it was due to the 2013 penny stock crash.

“[I] heard the losses were in the millions,” said Tiong.

While he knew that Wong’s clients were trading heavily in the shares of Blumont Group, Asiasons Capital (now Attilan Group) and LionGold Corp (collectively known as BAL), Tiong claimed that he did not know who was giving Wong instructions.

Tiong also claimed to have settled most of the losses in Ooi’s and Chong’s accounts after the crash out of his own pocket.

He recounted that there were some initial payments by cash to settle losses in the accounts, and added that these were likely to have been delivered by Jumaat bin Adam, the IPCO International courier.

After the crash, Tiong said he had engaged a debt collector and a lawyer, and had even sent a letter of demand to Malaysia, where Ooi and Chong were residing. He also claimed to have called the number associated with Soh to settle the losses.

“Inside joke”

More details also emerged in court on Thursday about Dongshan Group, the company formerly known as Greatronics Group, which was a listed company.

Tiong had revealed earlier in the trial that he had been introduced to Soh while looking for a job, and that Soh had given him a job as a director of Dongshan.

Before his arrest and remand, Soh was Dongshan’s acting chief executive officer and chief operating officer.

According to the deputy public prosecutor, Dongshan was a play on words and an inside joke to Soh and his associates.

Tan explained that Dongshan was a play on the Chinese phrase dong shan zai qi, which is a metaphor for “to make a comeback”. “Soh was planning to use Dongshan as a means of coming back after the crash of BAL shares,” Tan said.

The prosecution also revealed that Soh’s son, Soh Han Quan, was a major shareholder in Dongshan.

As Tan grilled Tiong about his knowledge of the group’s workings, Tiong claimed that he did not know that, and that he was initially paid $4,000 a month to look for a new business to inject into the shell company.

Tiong continued to deny that the trading orders in Ooi’s account was placed by someone other than Ooi. He also denied that he was hiding Soh’s and Quah’s involvement – as well as his own –in the scheme.

The defence counsels of Soh and Quah was comparatively brief in their cross examination of Tiong.

When Soh’s lawyer, senior counsel N Sreenivasan of K&L Gates Straits Law, asked Tiong if the BAL crash was due to queries and announcements by the Securities Investors Association of Singapore and the Singapore Exchange, Tiong agreed that it was part of the cause.

Tiong was queried further on this point by Quah’s counsel, Philip Fong, managing director of Eversheds Harry Elias.

On Fong’s question on whether he knew the reason behind the crash, Tiong answered that there were three reasons: that BAL share were placed as designated securities, that some broking houses were not allowing it to be traded on margin, and because of a rumour he heard that some broking houses were shorting the stock.

Fong’s questioning also revealed that Tiong was frontrunning or tailgating trades by mimicking trade orders in Ludovic’s and Prem’s accounts.

In the re-examination of Tiong, Tan probed further on the reasons listed by him on why the counters crashed.

When asked if he knew which broking houses did not allow the counters to be traded on margin, Tiong claimed that it was “hearsay” that some broking houses were doing that.

The trial resumes on Jan 2, 2020.

What the 2013 Penny Stock Crash trial is about

John Soh Chee Wen is the alleged mastermind behind the penny stock crash of 2013, which prosecutors have called “the most audacious, extensive and injurious market manipulation scheme ever in Singapore”.

Together with his alleged co-conspirator and girlfriend Quah Su-Ling, Soh and his associates are alleged to have been behind the massive rise and sudden collapse of shares in Blumont Group, LionGold Corp and Asiasons Capital (now Attilan Group), which wiped out some $8 billion in market value.

Subscribers can click here to read our 8-page special pullout on the penny stock crash trial.

Don’t miss out on these highlights in the penny stock saga so far:

Second tranche of witnesses (starting Oct 1, 2019)

First tranche of witnesses (March 11, 2019 to May 24, 2019)