KUALA LUMPUR: Securities Commission Malaysia (SC) has filed a civil suit at the Kuala Lumpur High Court against two individuals for insider trading involving the shares of GW Plastics Holdings Bhd (GW Plastics).
Lim Kok Boon and Cheah Mean Har were alleged to have been involved in the insider trading of GW Plastics’ shares in September 2012.
In the suit filed on Sept 28, SC claimed that Lim had communicated material non-public information to Cheah, in breach of section 188(3)(a) of the Capital Markets and Services Act 2007. SC claimed that Cheah had then purchased GW Plastics shares while in possession of the material non-public information in breach of section 188(2)(a) of the CMSA.
The material information referred to in the action related to a proposed Share Sale Agreement between GW Plastics and Scientex Packaging Film Sdn Bhd and a proposed distribution of the cash proceeds arising from the Share Sale Agreement to the shareholders of GW Plastics. The information was announced by GW Plastics to Bursa Malaysia on 3 October 2012. Lim was the Chief Executive Officer and Non-Independent Executive Director of GW Plastics at the material time.
SC is seeking a disgorgement of three times the profits made as a result of the insider trading and a civil penalty of RM1 million from each of the defendants.