AmFraser goes to trial over $1.88m suit against former client
In a High Court trial that started yesterday, stockbroking
firm AmFraser Securities is seeking to recover $1.88 million, with interest,
from a former customer who racked up the trading losses in the October 2013
penny stock crash.
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Selina Lum
08 July 2016
In a High Court trial that started yesterday, stockbroking firm AmFraser Securities is seeking to recover $1.88 million, with interest, from a former customer who racked up the trading losses in the October 2013 penny stock crash.
Mr. Goh Chengyu, 32, has refused to pay the debt, alleging that he is not liable as the trades in question were carried out without his authorisation.
The bone of contention in the case is whether Mr. Goh had a private arrangement with his trading representative, in which he authorised his cousin and the cousin's friend to trade on his behalf.
AmFraser, which has been renamed KGI Fraser Securities following an acquisition by Tai- wan's KGI Securities, contends that such an arrangement had been in place since Mr. Goh set up his trading account.
Mr. Goh - a project executive at a subsidiary of Wee Hur Holdings, a listed property developer substantially controlled by his father and other family members - disagrees.
He contends that he personally gave trading instructions to trading representative Heng Gim Teoh on all trades - except for the four disputed trades executed in early October 2013.
Setting out AmFraser's case yesterday, the firm's lawyer, Mr. Danny Ong, said that Mr. Goh first met Mr. Heng in January 2013 "at the instigation" of his cousin, Mr. Adrian Goh, then a corporate dealer with CIMB-GK Securities.
From February to September 2013, more than 90 trades worth over $45 million were made in Mr. Goh's accounts, mainly in four counters, namely Asiasons, Blumont, LionGold and IHC.
AmFraser contends that these trades, as well as four trades in October, were all executed by Mr. Adrian Goh or his friend Lincoln Lee.
Mr. Heng, who took the stand yesterday, testified that Mr. Goh had not called him "since Day 1".
After the penny stock crash, Mr. Heng said that Mr. Goh and his uncle - Mr. Adrian Goh's father - tried to put pressure on him to be the "scapegoat" and to accept personal liability for the losses.
Mr. Heng alleged that the Gohs offered him a job in Vietnam in exchange for admitting that the October trades were unauthorised.
He disagreed when Mr. Goh's lawyer Philip Fong put it to him that he had told his client that he would take responsibility for the losses in his account.
However, Mr. Heng agreed with Mr. Fong that there was no written authorisation from Mr. Goh for him to take instructions from Mr. Adrian Goh or Mr. Lee to trade with his account.
The trial continues.