SINGAPORE: The former executive chairman and CEO of restaurant operator No Signboard Holdings was fined S$420,000 (US$317,000) on Friday (Nov 1) for price rigging offences.
Lim Yong Sim pleaded guilty to three charges of false trading, said the Singapore Police Force (SPF) in a news release on Friday.
In June 2018, Lim purchased 4,331,200 No Signboard shares using the trading account of Gugong Pte Ltd. This was to falsely push up No Signboard’s share price.
“Lim was then the director and majority shareholder of Gugong, which was in turn a majority shareholder of No Signboard Holdings,” said SPF.
The police added that at the material time, Lim was under pressure from shareholders due to No Signboard’s declining share price.
The false trades lifted No Signboard’s share price by 27 per cent, from S$0.154 to S$0.196, against the backdrop of a decline of 1.69 per cent in the Straits Times Index during the same period.
The restaurant operator’s share price fell again afterwards, following the announcement of its 2018 financial year results. No Signboard’s share price fell to S$0.137 after the results announced on Nov 29 revealed that it had registered a loss.
A day after the announcement, Lim began trading in No Signboard shares again.
Between Nov 30, 2018, and Jan 11, 2019, he bought 3,535,100 shares using Gugong’s trading account. These trades were aimed at cushioning the fall of the restaurant operator’s share price.
“Lim’s trades supported No Signboard share price at around S$0.140 between Nov 30 and Dec 21, 2018, and at around S$0.130 between Jan 3 and Jan 11, 2019,” said SPF.
He also used No Signboard’s corporate share buyback account for “similar manipulative trades” on Jan 31, 2019, added the police.
Lim purchased 1,068,700 No Signboard shares the day before the release of the restaurant operator’s financial results for the first quarter of the 2019 financial year. The restaurant operator had again recorded a loss.
Lim’s trades were to “cushion the selling pressure that would likely follow from the imminent announcement”, said SPF.
The purchases were made above the price limit of No Signboard Holding’s share buyback mandate and raised its share price by 15.7 per cent over the previous day’s close.
“This far exceeded the movement in the STI, which rose only 0.50 per cent that day,” said the police.
Lim was arrested in April 2019 due to suspicions that he had breached sections under the Securities and Futures Act. He was charged in July last year for price rigging offences.
After his charging, No Signboard Holdings announced that Lim was suspended from all his executive duties.
