Japan Regulator Says Singapore-Based Hedge Fund Juggernaut Manipulated Share Prices

Japan Regulator Says Singapore-Based Hedge Fund Manipulated Share Prices

By Reuters on 5:56 pm August 1, 2013.
Tokyo. A Singapore-based hedge fund manipulated prices in the Japanese equity market and should pay a 431 million yen ($4.38 million) fine, Japan’s securities regulator said, which would be biggest ever imposed against a non-Japanese firm for market manipulation. The Securities and Exchange Surveillance Commission (SESC) said on Wednesday that Juggernaut Capital Management inflated the share price of real estate developer Rise Inc for 26 business days during March and April last year.Efforts to contact Juggernaut founder Yashwant Bajaj in Singapore were unsuccessful.

The SESC said it will seek approval from the Financial Services Agency to fine Juggernaut 431 million yen ($4.38 million). The FSA typically approves requests from the regulator to impose fines.

SESC said Juggernaut had placed large buy orders or traded heavily right before the close of the market sessions during the 2012 period through a fund in the Cayman Islands, which gave the impression to participants that Rise shares had strong demand.

The regulator estimated Juggernaut made about 200 million yen through illegal trading activities. Juggernaut would be the third non-Japanese company fined by the SESC for manipulation or insider trading.

The regulator announced a 14.68 million yen fine for U.S.-based First New York Securities in June 2012 for insider trading and in December a 67.71 million yen penalty for hedge

fund firm Tiger Asia Partners, also based in the U.S., for market manipulation.

Bajaj, at one time a Lehman Brothers’ managing director, launched Juggernaut in August 2011. Between January and April last year the hedge fund gained 58.6 percent, according to fund performance data seen by Reuters.

The firm stopped reporting fund performance after April 2012.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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