SINGAPORE (Oct 1): Prosecution witness Ken Tai Chee Ming has exposed more names within the local stock broking community that had connections with alleged 2013 penny stock crash masterminds John Soh Chee Wen and Quah Su-Ling.
Tai, who was once part of the duo’s “inner circle”, had said in his conditioned statement that one Roger Tan had introduced him to Quah in late 2010.
In court on Tuesday, Tai revealed that Tan was the chief executive officer of Voyage Research – the spin-off of the Singapore Investors Association (Singapore) that was formerly known as SIAS Research.
According to Tai, Tan had provided proxy accounts for Soh and Quah to use in their market rolling activities.
Under that arrangement, Soh and Quah would share the profits 50-50 with the proxy account owners, while absorbing any losses.
According to Tai, one of the proxy accounts provided by Tan belonged to Vincent Chia, the chairman of Transcorp Holdings.
Tai also described in detail the relationship that Soh and Quah had with a few of the brokers.
For example, Tai recounted that he saw Wong Xue Yu very often at the LionGold office after the October 2013 penny stock crash. Wong was the duo’s broker at AmFraser, and had provided third-party trading lines to Soh and Quah.
Tai said that there were instances when Wong was close to tears. “[Wong] told me that his losses were almost $28 million, and were mostly in his third-party lines, which were his friends and relatives,” he added.
Another broker, Ong Kah Chye, was fingered as an old friend of Soh, with their friendship going back some 20 years.
Ong was the trading representative for Peter Chen Hing Woon and Joseph Gutnick. The latter was the chairman of Merlin Diamonds, the company Innopac tried to acquire via a share swap.
“As far as I remember, it was Soh who instructed [Gutnick] to open an account with Ong,” said Tai. “Subsequently, I heard Soh placing orders with Ong to buy Innopac [shares].”
Tai also explained that he had heard Soh and Quah giving instructions to other brokers, such as Lincoln Lee from Kim Eng and a “Jordan” from DMG.
He also mentioned that he was aware that Soh and Quah had an arrangement with another market operator named Tan Chin Hock, where they would “cross” their “headcount”.
Under this arrangement, Soh and Quah would provide proxy accounts to Tan for his use, in return for Tan providing them with proxy accounts to use for Blumont, Asiasons and LionGold.
Tai explained that this was in order to ensure that there appeared to be multiple buyers in the market.
According to Tai, the addition of LionGold into the MSCI small cap index was a cause of joy for Soh, who reportedly told him that he had “found the formula” for inclusion.
Soh’s conclusion from this, Tai said, was that the companies don’t need to have strong fundamentals, only trading volume and market cap.
The inclusion into the MSCI index also led fund managers to add the counter into their portfolios. Tai noted that the Vectors Junior Gold Miner ETF had bought a stake in LionGold.
Tai also revealed that AmFraser took a huge haircut in their losses from the penny stock crash, with Soh and Quah only paying 15 cents on every dollar.
The trial will resume on Wednesday as the prosecution continues its examination-in-chief.
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.
Don’t miss out on these highlights in the penny stock saga so far:
Second tranche of witnesses (starting Oct 1, 2019)
- John Soh, alleged mastermind behind penny stock crash arrested; to be charged on Friday
- John Soh, Quah Su-Ling and Goh Hin Calm set to be charged
- John Soh Chee Wen and Quah Su-Ling charged in largest market manipulation scheme in Singapore’s history
- Charges slapped on masterminds of penny stock scheme cast new light on old reports
- Prosecutors confirm links between ISR Capital and John Soh
- John Soh-linked ISR Capital’s CEO Quah Su Yin resigns
- Penny stock saga’s alleged mastermind John Soh denied bail; faces total of 188 charges
- John Soh could face longest-ever jail term for financial crime in Singapore
- John Soh's legal team from WongPartnership discharges itself
- John Soh's 'treasurer' Goh quits as interim CEO of IPCO
- Defence lawyers for alleged masterminds attempt to pin 2013 penny stock crash on forced selling
- 2013 penny stock crash case to go to trial
- Alleged 'treasurer' Goh Hin Calm to testify against Soh, Quah
- Penny stock crash scandal's 'treasurer' sentenced to three years' jail
- Goh Hin Calm confirmed as prosecution witness as penny stock crash trial kicks off
- The charismatic bankrupt who allegedly pulled the strings behind Singapore's largest stock manipulation scandal
- Inner workings of penny stock scandal revealed by first prosecution witness
- Prosecution witness coached by investigating officer, claims John Soh's lawyer
- Quah Su-Ling's lawyer accuses prosecution witness of 'inventing evidence', front-running
- Ex-remisier admits to conducting trades without third-party authorisation from account holders
- Ex-remisier Ng denies being coached; RHB trader Alex Chew admits to telling the whole truth only in third statement
- 'Fearful' prosecution witness admits even third statement might not have been the whole truth
- John Soh gave presentation on 'mothership' Blumont at LionGold's offices, says prosecution witness Andy Lee
- Prosecution witness Lee accused of lying and concealing facts in court
- New witness claims Quah Su-Ling was 'hysterical' when asked about settlement of losses
- More telephone records reveal Quah's hand behind trades; private bank Coutts wrote off $4.7 mil from penny stock crash
- Witness shocked by alleged breaches in trading regulations
- SGX restrictions could have caused 2013 penny stocks crash, says Lim & Tan director
- John Soh's former girlfriend had full control of bank account used in trading, court hears
- Quah's employee delivered cash payments for 8 accounts, court hears
- Witness cites 'clerical oversight' as defence alleges lack of anti-money laundering checks
- Ex-Maybank Kim Eng dealer admits Soh gave orders on trades in 3 accounts
- Counsels argue over how witnesses' conditioned statements were prepared and used
- Witnesses say John Soh, Quah Su-Ling directed 2013 stock manipulation trades