Man fined S$70,000 for insider trading of GS Holdings shares

THE Monetary Authority of Singapore (MAS) imposed a civil penalty of S$70,000 on businessman Tay Joo Heng for conducting insider trading of shares in GS Holdings, a food and beverage business operator that also offers branding, operation and procurement services.

This follows a joint investigation by the Commercial Affairs Department (CAD) and MAS into the case, said both parties on Monday (Jul 1).

Tay was the sole shareholder and director of GSG Capital, which purchased GS Holdings’ then subsidiary, GreatSolutions, for a consideration of S$2 million.

He was noted to have been approached by GS Holdings as a potential buyer on Oct 2, 2019.

MAS and CAD’s investigations found that over a period of 13 days between Oct 4 and Nov 18, Tay purchased 515,000 shares in the company while “in possession of material non-public information relating to the group’s intended sale of GreatSolutions”.

“As GreatSolutions had been loss-making, Mr Tay held the view that the market would react positively to the news and anticipated that GS Holdings’ share price would rise,” noted the authorities. 

GreatSolutions’ sale was subsequently announced by GS Holdings on Nov 19, 2019. This was followed by a spike in trading volumes of the company’s shares.

The 915,600 shares in the company that changed hands on the following trading day represented a 58 per cent increase from the counter’s average daily traded volume in the prior month.

Tay has since admitted to contravening insider trading rules under the Securities and Futures Act, and paid MAS the civil penalty without court action.

He has also voluntarily undertaken to not be a company director, or be involved in the management of a company, for a period of two years.

GS Holdings remained unmoved at S$0.021 as at 10.44 am on Monday, after the announcement.