Sun Weiyeh, a former fund manager and director of One Asia Investment Partners (OAIP) was convicted on April 11 and sentenced on July 2 to 6 months’ imprisonment for engaging in acts which were likely to defraud investors. This is the first conviction under the Securities and Futures Act (SFA) for fraudulent or deceptive conduct relating to over-the-counter (OTC) bond trading, according to a press release by the Monetary Authority of Singapore (MAS).
Sun was charged on Oct 22, 2020, for two counts under Section 201(b) of the SFA for engaging in acts which were likely to defraud investors of a fund managed by OAIP (Fund A). He had sold two OTC bonds at lower prices from Fund A to another OAIP fund (Fund B) of which he was the majority investor, while knowing that there were earlier available bids at higher prices. Sun subsequently sold the two bonds to the market at a profit. This caused a US$342,500 ($465,287.96) loss to investors in Fund A.
Sun carried out his misconduct by first soliciting bids from various market participants via the Bloomberg chat messaging system. He then used lower bid prices as the reference prices to sell the two OTC bonds from Fund A to Fund B via pass-through trades through an intermediary, instead of selling the bonds to a market participant who had offered higher prices or using those higher prices as the reference prices for the pass-through trades.
Following a 26-day trial, the District Court found Sun guilty of both charges. This case was jointly investigated by the MAS and the Commercial Affairs Department of the Singapore Police Force.
