The State Courts have sentenced Tan Kheng Yeow, the former CEO and executive director of KTL Global to eight months’ imprisonment. Tan was sentenced on Jan 23 after pleading guilty to one charge under section 197(1)(a) of the Securities and Futures Act (SFA).
According to the joint statement by the Monetary Authority of Singapore (MAS) and the Singapore Police Force (SPF), Tan had conspired with Tang Boon Hai to create a “false or misleading appearance” of active trading in KTL’s shares amid concerns that the company was unable to meet the minimum trading price (MTP) requirement imposed by the Singapore Exchange S68 .
SGX announced the MTP requirement for Mainboard-listed issuers on Aug 1, 2014. The requirement, which was implemented in March 2015, meant that an issuer’s volume weighted average price (VWAP) over a six-month period cannot fall below 20 cents. Any issuer that failed to comply with the MTP faced the possibility of delisting.
As of Aug 1, 2014, the VWAP of KTL’s shares were below the MTP.
It was between Oct 16, 2014, and Sept 8, 2015, that Tan and Tang committed the offence. The pair intended to induce genuine market participants to buy KTL’s shares, thereby increasing its share price through their actions.
Tan also held “significant quantities” of KTL shares and knew that his net worth would increase along with KTL’s share price. Tan also arranged to transfer funds to Tang to finance trades in KTL shares placed by the latter in 14 trading accounts. Tang was convicted and sentenced to 30 months’ imprisonment on April 18, 2023.
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Tan still faces two other charges of cheating and dishonesty including inducing delivery of property. Tan was charged on Oct 29, 2020. Court proceedings are ongoing for those charges. Another individual, former OCBC Securities trader Tan Chun Yong, was charged on the same day. His charges include one count of intentionally aiding in the false trading of KTL shares and six counts of unauthorised trading.
Tan’s conviction came after a joint investigation by the MAS and SPF following a referral by the Singapore Exchange Securities Trading Limited (SGX-ST).
In November 2017, KTL Global said that Tan was interviewed by the MAS in relation to possible offences under section 197 of the SFA.
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On May 15, KTL Global announced that the SGX-ST will proceed to delist the company under listing rule 1315. The company was placed on the watch-list on Dec 4, 2019 under listing rule 1311. Trading in the company's securities were suspended on Aug 17, 2021.
On March 15, SGX granted KTL Global an extension till June 30 to meet the requirements of listing rule 1314 to give the company sufficient time to exit the watch-list.
