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Koyo Intl’s managing director under probe for possible securities breaches

SINGAPORE — The Monetary Authority of Singapore (MAS) and white-collar crime buster Commercial Affairs Department (CAD) are investigating the managing director of Koyo International, an engineering services provider listed on the Catalist board, for possible breaches of securities laws.

SINGAPORE — The Monetary Authority of Singapore (MAS) and white-collar crime buster Commercial Affairs Department (CAD) are investigating the managing director of Koyo International, an engineering services provider listed on the Catalist board, for possible breaches of securities laws.

Mr Foo Chek Heng, the founding member of Koyo Group, informed the company on Feb 10 that he was interviewed by MAS and CAD as part of an investigation for “possible offences” under section 197 of the Securities and Futures Act (Cap 289), Koyo International said in a stock exchange statement late Wednesday. Section 197 pertains to false trading and market-rigging transactions.

Mr Foo has handed over his travel documents as well as certain devices and documents to them, the statement said.

A company spokeswoman told TODAY that Mr Foo has returned to work. Business and operations have not been affected and are continuing as usual, the spokeswoman said.

Mr Foo disputes the allegation by MAS and CAD, and will cooperate fully with them in their investigation, Koyo said in the statement.

Koyo, established in 1983, was listed on the Catalist board in 2009, the same year its subsidiary Koyo Engineering (SEAsia) was awarded the SME 500 award, which indicates that it is one of the top 500 SMEs in Singapore.

The company provides specialist mechanical and electrical engineering services to customers in the construction, marine, oil and gas, industrial, and pharmaceutical sectors, as well as the public sector.

Some of its previous clients include the Ministry of Education, Hotel Royal, NTUC Fairprice Co-operative, the Land Transport Authority, and the National Healthcare Group, according to its website.

The investigation into Mr Foo comes after the Singapore Exchange, on Jan 15, issued a cautionary statement on trading in Koyo’s shares, saying their share price had remained steady to higher between Oct 26 and Jan 14 despite the decline in the broader market. It also noted that a small group of individuals was responsible for 60 per cent of its trading volume during that period, of which, at least half of the trades were due to this group of individuals buying and selling among themselves.

Koyo shares fell 7.3 per cent to close at S$0.063 yesterday.

Koyo’s statement on Wednesday comes a week after the SGX, on Feb 5, issued a statement urging investors and potential investors to exercise caution when dealing in the shares of mainboard-listed Chinese firm, Zhongmin Baihui Retail Group.

Again here, the SGX said the share price of Zhongmin Baihui had remained steady between Oct 26 and Feb 4, despite the sell-off in the broader market. It also said that a small group of individuals, who appear to be connected to each other, was responsible for more than 90 per cent of the on-market buy volume of Zhongmin Baihui’s shares during that period.

“SGX is reviewing the trades in ZMBH shares and will take the necessary actions,” it said in an announcement then.

Zhongmin Baihui closed down 3.8 per cent yesterday to end at S$1.25. The broader Straits Times Index fell 1.7 per cent.

“(Investors) need to ask the companies questions, so that accountability can be achieved. They need to follow the company, not just buy the shares and leave it. They need to follow the company’s development and ask them questions,” said Mr David Gerald, the president and chief executive of investor rights watchdog Securities Investors Association Singapore (SIAS).

Singapore is sparing no effort to shore up investor confidence following the 2013 penny stock crash, when S$8 billion in market value was wiped out.

The Singapore High Court last month denied a request by Malaysian businessman John Soh to return home to visit his ailing mother and attend his son’s wedding, after the prosecution said he could be the “mastermind” behind a false trading and market-rigging case that led to the “unprecedented collapse” of the stocks.

Investigations are at an advanced stage and charges could be filed by the end of the year, the prosecution said.

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