The High Court today ruled in favour of the Securities Commission Malaysia in an insider trading civil suit filed against Lim Kok Boon and Cheah Mean Har who was the Chief Executive Officer and Non-Independent Executive Director of GW Plastics Holdings Bhd (GW Plastics) which has renamed itself to MCT and since been taken over by Avaland.
Both were ordered to pay the SC RM142,500 disgorgement, which is three times the profits gained by Cheah as a
result of the insider trading breach. Lim and Cheah were also required to pay a civil penalty of RM1 million and RM500,000
respectively. Additionally, the court ordered them to pay costs of RM200,000 and RM30,000 respectively to the commission.
The court also barred Lim from being appointed as a director of a public listed company for a period of five years beginning from the date of the court judgment on 22 April 2024.
Lim was found to have breached section 188(3)(a) of the Capital Markets and Services Act 2007 (CMSA) when he communicated material non-public information to Cheah. Cheah subsequently acquired GW Plastics shares on 25 and 27 September 2012, and was found liable by the High Court for a breach under section 188(2)(a) of the CMSA.
The material information was in relation to a proposed Share Sale Agreement between GW Plastics and Scientex Packaging Film Sdn Bhd and a proposed distribution of the cash proceeds arising from the Share Sale Agreement to the shareholders of GW Plastics. The information was announced by GW Plastics to Bursa Malaysia on 3 October 2012.
