Who regulates the regulator in Singapore?

Who regulates the regulator?

October 30th, 2013

Share prices of Asiasons Capital, Blumont Group and LionGold Corp almost doubled in no-holds-barred trading… PHOTO: REUTERS. BT, 22/10/2013

The actions of Singapore Exchange (SGX), the market regulator, over the past three weeks have left many questions unanswered (“Penny stock drama likely to hold traders’ attention”; Monday). Why did it not take action when the prices of three locally listed companies – Blumont Group, Asiasons Capital and LionGold Corp – rose spectacularly? And why did it eventually decide to act and raise queries? Did its actions cause market panic, leading to the crash of these stocks? And why was the possibility of further probes announced only after the stocks resumed trading after their suspensions were lifted? Billions of dollars have been wiped out in a flash. Hasn’t the SGX learnt its lesson from the financial crisis in 2008 – that is, if you take your eye off the ball, there can be disastrous consequences? More importantly, does the regulator need regulation? The SGX has a lot of explaining to do, not only on the whats and whys of the recent fiasco, but also how it is going to prevent such incidents from happening again. The last thing Singapore needs is a reputation for poor market regulation.

Samuel Owen
* Letter first appeared in ST Forum (30 Oct).

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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