SINGAPORE (Mar 29): The drama continues in Day Four of the trial of John Soh Chee Wen and Quah Su-Ling as Quah’s defence counsel accused the prosecution’s first witness of “inventing evidence” and engaging in the practice of front-running.
Continuing in his cross-examination of OCBC Securities remisier Ng Kit Kiat, Quah’s lawyer Philip Fong in court on Friday homed in on the daily trade reports Ng sent via SMS to Soh and Quah.
Fong put forward that trade summaries are meant to provide an accurate picture of the trades that were executed. But pointing out certain errors in some of these SMSes, he argued that Ng’s reports were “inaccurate”.
Ng conceded that some of these mistakes could have been due to “typo error”. “My clients are very, very smart people,” Ng replied. “They would know these are typo mistake.”
Fong also pointed out that these daily SMS reports were “incomplete” and did not include all the information of trades carried out. For instance, Fong said, information of sell trades executed had been left out on in 26 of these SMS reports.
Ng explained that this was because Soh and Quah had, in earlier conversations, requested for only buy trades to be included in the reports, as statements on these buy positions were more important.
Fong, however, noted that Ng had not mentioned this at all in his conditional statements. “Mr Ng, I put it to you that you are inventing new evidence every time you are caught lying,” Fong said. Ng disagreed.
Fong, a managing partner at Eversheds Harry Elias, argued that Ng’s “so-called reports” were “meaningless” and could not be considered summaries of trade as they were both “inaccurate” and “incomplete”.
Further, Fong argued that Soh and Quah did not ask for these daily SMS reports, and did not even think of them as reports.
Comparing records of telephone calls made to and from Ng’s mobile phone with records of trade orders Ng had placed, Fong also sought to show that Ng had engaged in front-running.
Front-running is when a broker enters into an equity trade with foreknowledge of a block transaction that will influence the price of the equity, resulting in an economic gain for the broker.
Fong suggested that this was because Ng had already known “Peter Chew” was Soh, even before they met at the LionGold office.
Earlier, Ng had testified that he recognised Soh when they met at the office at Mohammed Sultan Road. Ng said this was because Soh was a prominent figure in the stock market in the 1980s, whose photographs were often in Chinese newspapers then.
When Soh passed him his telephone numbers, Ng recognised those numbers as belonging to “Peter Chew”.
See: Inner workings of penny stock scandal revealed by first prosecution witness
“You knew you were talking to John Soh all this time, even before the market crashed,” Fong said.
Under cross-examination in court on Friday, Ng agreed that Soh was considered an “influential person” in the stock market, and that the price of a stock could be expected to rise if “market talk” believes he was “supporting” a particular counter.
Fong then accused Ng of making use of such market intelligence for his own benefit.
For example, Fong pointed out records that showed that, after receiving a call from Soh’s number, Ng had place a sell order for 1 million shares in Blumont Group in his wife’s account, before placing sell orders in the accounts belonging to Lim Siew Hooi and Kuan Ah Ming.
“Let me suggest to you that you had made use of the information on sell orders for [Kuan] and [Lim’s] accounts and you took advantage of that situation by placing a sell order in your wife’s account,” Fong said.
Ng disagreed. He later claimed that he had entered the order in his wife’s account while the phone was still ringing, and before he had picked up Soh’s call.
To this, Fong pointed out that the timestamps on the phone call and the order entered showed otherwise.
When Ng then claimed this was a “special case”, Fong pointed out several other examples of orders made in Ng’s wife’s account that preceded orders following instructions from Soh and Quah.
"Do you agree that you were front running in this case?" Fong pressed repeatedly.
"Yes," Ng finally conceded.
“This witness has indulged in the worst case of front-running possible," said Soh’s defence counsel, N Sreenivisan of Straits Law.
However, deputy public prosecutor Peter Koy brought up a key point during the defence’s questioning.
Koy argues that by accusing Ng of front-running, or making trades to his own benefit after receiving information from Soh and Quah, then it would also mean that the defence concedes that the pair had indeed made calls to Ng to give trading instructions.
Later, the prosecution and defense counsels met with Judge Hoo Sheau Peng in chambers for nearly an hour. Upon resuming hearing, Koy said that as a result of the way Ng has provided evidence during cross-examination, the prosecution will review their disclosure obligations and furnish the defence with further documentation and exhibits.
Both defence counsels Sreenivasan and Fong agreed that it would not be feasible to continue without first reviewing the additional documents.
The trial is adjourned until April 22.
2013 Penny Stock Crash
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.
For the latest updates on this developing story, visit http://dedge.news/crash
Don’t miss out on these highlights in the penny stock saga so far:
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- The charismatic bankrupt who allegedly pulled the strings behind Singapore's largest stock manipulation scandal
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