Monetary Authority of Singapore v Wang Boon Heng

JudgeSee Kee Oon J
Judgment Date31 October 2017
CourtHigh Court (Singapore)
Docket NumberDistrict Court Appeal No 6 of 2017
Date31 October 2017
Monetary Authority of Singapore
Wang Boon Heng and another

[2017] SGHC 268

See Kee Oon J

District Court Appeal No 6 of 2017

High Court

Civil Procedure — Appeals — Civil penalties imposed — Whether standard of review for appeal against quantum of civil penalties imposed was satisfied

Financial and Securities Markets — Securities — Trading — Respondents carrying out share trading without authorisation thus defrauding or deceiving brokerage firms in breach of s 201(b) Securities and Futures Act (Cap 289, 2006 Rev Ed) — Whether quantum of civil penalties was correct — Sections 201(b) and 232(3) Securities and Futures Act (Cap 289, 2006 Rev Ed)

Held, allowing the appeal:

(1) The principles governing the standard of review in an appeal against the quantum of civil penalties imposed were (a) where the judge took into account an improper factor and/or failed to take into account a material factor, or erred in the weighing of the factors; (b) where the judge acted on wrong principles; (c) where the judge erred with respect to the proper factual basis or misapprehended the facts before him; and (d) where, for the above or other reasons, the quantum of civil penalty imposed by the judge was plainly wrong, such as a decision that was clearly outside what could be justified by correct reasoning: at [39].

(2) The factors to be considered in determining the quantum of civil penalties could be classified into two broad categories: the severity of the violation and the culpability of the defendant. The non-exhaustive factors relating to the severity of the violation were (a) the mechanics and degree of sophistication of the defendant's conduct; (b) the actual or potential impact of the defendant's conduct on the market; (c) the amount of money involved in the offending transactions; (d) the scale, frequency and duration of the violations; (e) the number of third parties affected by the defendant's conduct; (f) the actual or potential impact on third parties; and (g) the severity of the impact on third parties. The factors relating to culpability were offence-specific and included (a) whether the defendant's conduct was a deliberate or flagrant disregard for the law; (b) whether there was evidence of dishonesty on the part of the defendant, such as the deliberate concealment of his conduct aimed at avoiding detection, or the destruction of incriminating evidence; (c) the extent of the defendant's involvement in the violation; and (d) whether the violation amounted to an abuse of a position of trust or authority: at [57], [60] and [61].

(3) The court should then consider other general aggravating and mitigating factors that were not offence-specific including, non-exhaustively, (a) whether the defendant showed remorse or contrition; (b) whether the defendant had relevant antecedents; and (c) whether the defendant cooperated with the authorities: at [62].

(4) These factors were not prescriptive in nature, and the appropriate civil penalty to be imposed was the product of a fact-sensitive exercise of discretion that was not capable of being articulated definitively or exhaustively as rigid principles: at [63].

(5) In line with the purposes of the SFA, which were to protect investors, protect public confidence in the market, and ensure that the operation of the market was not distorted, if there was proof of actual distortion of or potential impact on the true forces of supply and demand in the market and/or an adverse impact on third parties, this would be a significant aggravating factor that justified higher civil penalties. The lack of market impact was a neutral factor at best and not a mitigating factor. The amount of profit accrued or loss avoided to the defendant himself was not a factor to be considered as the precondition under s 232(3) of the SFA was that the contravention “did not result in [the defendant's] gaining or avoiding a loss”. Personal financial hardship could not be relied on in mitigation except in the most exceptional cases: at [64], [65] and [68].

(6) In determining the preliminary quantum of civil penalty, the court should consider the range of conduct that might be captured at either end of the penalty range and then determine where in that spectrum the conduct before the court fell. The court might make adjustments to the preliminary quantum to adhere to the principles of proportionality and parity, the totality principle and to ensure that the penalty was sufficient to achieve objectives of punishment as well as general and specific deterrence: at [66] and [67].

(7) Applying the law to the facts, the court could intervene with the District Judge's quantification of penalties, because he had committed certain fundamental errors. First, the loss suffered by the remisier, a third party, was a relevant and important fact in determining the quantum of civil penalties and the District Judge erred in not giving this factor sufficient weight. Second, he erred in treating the lack of market impact as a mitigating factor. Third, he erred in taking into account the financial hardship that would result from the imposition of a severe pecuniary penalty. Fourth, he erred in failing to take into account or to give sufficient weight to the sheer scale and frequency of the unauthorised transactions, such that the penalties imposed were inordinately modest and disproportionate to the Respondents' culpability, and coupled with the difficulty of detecting such contraventions, the deterrent effect was marginal at best. Fifth, he further erred in failing to adequately take into account the difference in relative culpability between the Respondents in imposing only a $25,000 difference in quantum: at [73] to [76], [79], [80], [83] and [84].

(8) In increasing the penalty imposed on the 1st Respondent to $150,000 and the penalty imposed on the 2nd Respondent to $75,000, the following factors were considered: the mechanics of the contraventions were unsophisticated, there was no known impact on the market, the total amount of money involved in the transactions was not insignificant, there were 573 transactions on four accounts with two securities firms in relation to the 1st Respondent (407 of which the 2nd Respondent was a party to), a loss of $136,000 was caused to a third party, the Respondents' conduct was deliberate, the Respondents did not have relevant antecedents but they had not been forthright or cooperative with the authorities and were intent on deliberately concealing or obfuscating their involvement, and no restitution of losses to the third party was offered: at [85] to [89].

Case(s) referred to

Ang Lilian v PP [2017] 4 SLR 1072 (refd)

Australian Securities and Investments Commission v Adler [2002] 42 ACSR 80 (refd)

Chan Chun Hong v PP [2016] 3 SLR 465 (folld)

Costa v Public Trustee of New South Wales [2008] NSWCA 223 (folld)

Davies v Powell Duffryn Associated Collieries Ltd [1942] AC 601 (refd)

Dinesh Singh Bhatia s/o Amarjeet Singh v PP [2005] 3 SLR(R) 1; [2005] 3 SLR 1 (refd)

Doyle v Australian Securities & Investments Commission [2005] WASCA 17 (refd)

Lai Oei Mui Jenny v PP [1993] 2 SLR(R) 406; [1993] 3 SLR 305 (folld)

Lee Chee Keet v PP [2016] 4 SLR 1316 (refd)

Mehra Radhika v PP [2015] 1 SLR 96 (refd)

PP v Koh Thiam Huat [2017] 4 SLR 1099 (folld)

PP v Mohammed Liton Mohammed Syeed Mallik [2008] 1 SLR(R) 601; [2008] 1 SLR 601 (refd)

PP v Ng Sae Kiat [2015] 5 SLR 167 (folld)

PP v Ong Ker Seng [2001] 3 SLR(R) 134; [2001] 4 SLR 180 (folld)

PP v Siew Boon Loong [2005] 1 SLR(R) 611; [2005] 1 SLR 611 (refd)

PP v UI [2008] 4 SLR(R) 500; [2008] 4 SLR 500 (refd)

Securities and Exchange Commission v Brethen Fed Sec L Rep 97 (SD Ohio, 1992) (refd)

Securities and Exchange Commission v Ed Johnson 174 Fed Appx 111 (3rd Cir, 2006) (refd)

Securities and Exchange Commission v Lybrand 281 F Supp 2d 726 (SDNY, 2003) (refd)

Securities and Exchange Commission v Michael G Sargent 329 F 3d 34 (1st Cir, 2003) (refd)

Securities and Exchange Commission v Yun 148 F Supp 2d 1287 (MD Florida, 2001) (refd)

Stansilas Fabian Kester v PP [2017] 5 SLR 755 (refd)

Tan Boon Heng v Lau Pang Cheng David [2013] 4 SLR 718 (refd)

Tan Chong Koay v Monetary Authority of Singapore [2011] 4 SLR 348 (refd)

Tan Koon Swan v PP [1985–1986] SLR(R) 976; [1986] SLR 126 (refd)


This was an appeal by the Monetary Authority of Singapore (“the Appellant” or “the MAS”) against the decision of the district judge (“the District Judge”) to impose civil penalties of $75,000 and $50,000 respectively on Mr Wang Boon Heng and Ms Foo Jee Chin (“the 1st Respondent” and “the 2nd Respondent” respectively, and “the Respondents” collectively) in relation to numerous instances of unauthorised share trading, each of which was an alleged breach of s 201(b) of the Securities and Futures Act (Cap 289, 2006 Rev Ed) (“SFA”).

The 1st Respondent was a shareholder and project manager in a company known as Natius 1989 Pte Ltd (“Natius”). The 2nd Respondent was the company secretary at Natius. At the time of the violations, the 1st Respondent was an undischarged bankrupt. Nonetheless, he carried out a total of 573 instances of share trading on four trading accounts which were opened in the name of the 2nd Respondent and one Mr Tay Ah Thiam (“Mr Tay”), who was employed as a driver at Natius. The District Judge found that the Respondents had contravened s 201(b) of the SFA and were liable to pay civil penalties under s 232(3) of the SFA, and this liability was not disputed by the Respondents on appeal. The District Judge imposed a penalty of $75,000 on the 1st Respondent and a penalty of $50,000 on the 2nd Respondent. The MAS appealed against the District Judge's decision on the quantum of civil penalties imposed.

Legislation referred to

Criminal Procedure Code (Cap 68, 1985 Rev Ed) s 261

Criminal Procedure Code (Cap 68, 2012 Rev Ed) s 394

Securities and Futures Act (Cap 289, 2006 Rev Ed) s 232(3) (consd); ss 197(1)(b), 201(b), 232(2)


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1 books & journal articles
  • Securities and Financial Services Regulation
    • Singapore
    • Singapore Academy of Law Annual Review No. 2017, December 2017
    • 1 December 2017 (accessed 15 March 2018). 36 Monetary Authority of Singapore v Wang Boon Heng [2018] 3 SLR 582. 37 Monetary Authority of Singapore v Wang Boon Heng [2018] 3 SLR 582 at [39]. 38 This had been suggested by James Leong et al, “A Practi......

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