SC charges former substantial shareholder of Maxbiz with insider trading

PETALING JAYA: Securities Commission Malaysia (SC) yesterday charged Datuk Andrew Leong Wye Keong, a former substantial shareholder of Maxbiz Corp Bhd, with four counts of insider trading.
This follows the charges against its former managing director Datuk Vincent Leong Jee Wai last week for communicating inside information to Andrew.
The SC said in a statement that Andrew was charged under Section 188(2)(a) of the Capital Markets and Services Act 2007 (CMSA) for disposing of 2.13 million Maxbiz shares in his son’s account on Dec 30, 2010, and 8.1 million Maxbiz shares in his own account between Dec 30, 2010 and Jan 18, 2011, while in possession of inside information.
The SC alleged that Andrew had obtained the inside information from Vincent at the material time.
The material non-public information for the first three charges relates to a decrease in Maxbiz’s shareholder equity that brought it close to being classified as financially distressed.
Meanwhile, the material non-public information in the fourth charge concerns the classification of Maxbiz as a Practice Note 17 (PN17) company. PN17 status means that a company is financially distressed.
Maxbiz was delisted on March 26, 2012.
Andrew claimed trial yesterday and Kuala Lumpur sessions court judge Zulqarnain Hassan fixed bail at RM600,000 with two sureties.
Insider trading is punishable with an imprisonment term not exceeding 10 years and a fine of not less than RM1 million under the CMSA.