Turning around troubled companies was something of interest to John Soh Chee Wen the alleged mastermind behind the manipulation of the three penny stocks in 2013.
“I love doing deals, I love the adrenaline of doing deals,” he told the court on May 11 during the examination-in-chief by his defence counsel, N Sreenivasan of K&L Gates Straits Law.
However, Soh paused briefly when asked if he would describe himself as a “deal junkie”. Soh explained this was because the term “seems to have a negative connotation”. But, “I’ll live with it”, he chuckled when pushed by Sreenivasan to use another word to describe this love.
Together with Quah Su-Ling, the 61-year-old is on trial for allegedly orchestrating Singapore’s largest share manipulation scheme between 2012 and 2013 involving three penny stocks: Blumont Group, Asiasons Capital (since then delisted) and LionGold Corp, which has been renamed Shen Yao Holdings.
From shampoos to gold mines
The court heard that Soh’s foray into entrepreneurship started when he was just 20 years old, selling shampoos and T-shirts. As each T-shirt cost RM1.50 and he had sold it for RM9.90, Soh said he “made a lot of money”, adding that he became a millionaire at the age of 22.
He also owned a company that wound up shortly following what he said was a disaster in the Malaysian banking system that saw the collapse of cooperative movements and the recall of loans.
That experience of running a business that had been down and out led him to look for similar “dead and dying companies”. He would then offer his “two cents’ worth” on the value of the company and subsequently “take them over for free or nearly-free”.
Several takeover opportunities came in response to a newspaper advertisement entitled “Is your company in trouble?” which he wrote and put up.
“I found that it became a fantastic con,” he told the court. “I go in and see [the company], talk to them, told them what its problem was and offer them a deal at the end of the day.” Soh said if the company was found to be suitable for a takeover, he would demand “50% of its equity,” in exchange for free or the token sum of $1.
Along the way, Tan Kuan Hong, one of Soh’s contacts, took over SGX-listed Asia Tiger, which made office equipment. The company was eventually renamed LionGold after it changed its focus to mining with Soh’s involvement.
Soh, who held the title advisor to the chairman of LionGold, said he learnt more about the mining busi- ness after he made a trip to Mali with Daim Zainuddin, the former finance minister of Malaysia who was the owner of International Commerce Bank which was focused on developing Third World countries.
For a couple of years, LionGold grew by actively acquiring other gold mines through the issuance of new shares. Around 2009–2010, Asiasons became a substantial shareholder of LionGold.
Blumont was led by Soh’s close associate Neo Kim Hock who had wanted to “put in some properties”. But after seeing the growing interest in mining as the Singapore Exchange was promoting the sector at that time, Neo also transformed Blumont into a mining company, said Soh.
‘Quah shows it on her face’
Soh also told the court how he met his co-accused Quah around 2001– 2002 when they were introduced by her distant cousin. They only had deeper interactions later when they worked to revive Bursa-listed QSR, which controlled the operations of KFC and Pizza Hut in both Malay- sia and Singapore.
“I persuaded [Quah] to come in with her money and her network’s money,” said Soh, referring to her friends from Hong Kong, Penang and Indonesia.
Soh described his style as more “political”, nice and tolerant to everyone. In contrast, Quah is “totally non-political”.
“If she doesn’t like you, it shows on her face,” he added. In any case, Soh and Quah became intimate at the end of 2012–2013 after Soh’s wife had passed away, the court heard.
In the May 11 court session, Sreenivasan kicked off his defence by saying that the prosecution “could not sustain the story”. The story he was referring to was the allegation that Soh had masterminded the artificial manipulation of the three penny stocks.
Sreenivasan then went on to point out how the prosecution witnesses alluded to Soh “orchestrating a cover-up”.
“All of them gave statements at the beginning that were exculpatory of themselves and exculpatory of the accused,” he said, referring to some of the witnesses by name, like Ken Tai Chee Meng, a former broker who actively helped Soh and Quah trade. “The witnesses are in fact guilty people who were initially covering up their own weaknesses which have now come to light.”
Meanwhile, Quah said she chose to remain silent as she had “run out of resources” and that her legal team from Harry Elias, who had represented her since Nov 2016, has quit.
“I would like to place it on record that these numerous adjournments caused mainly by late disclosures and revised revisions of evidence which was in dribs and drabs, have severe- ly prejudiced me in conducting my defence,” said Quah, reading from a prepared statement.
The same points were made by Quah’s lawyers last year when they applied for a stay in proceedings that was subsequently rejected by Justice Hoo Sheau Peng.
Taking the stand without legal representation would “be unfair and prejudicial” given that she is not legally trained, added Quah.
“I am fearful not because I am guilty but rather how the case has been conducted by the prosecution,” said Quah.
The hearing continues.
