Goh Hin Calm gets 3 years for role in trading conspiracy

One of the three defendants in the penny stock case was sentenced to three years' jail on Wednesday after he pleaded guilty to abetting in the "most audacious, extensive and injurious market manipulation scheme ever in Singapore" involving three counters that saw S$8 billion in market value evaporating in 2013.

Former Ipco International interim chief executive Goh Hin Calm, 59, was handed the three-year imprisonment term by High Court Judge See Kee Oon after he pleaded guilty to two charges of intentionally aiding his ex-boss Quah Su-Ling and alleged mastermind John Soh Chee Wen in a conspiracy to artificially inflate the share prices of Blumont Group, Asiasons Capital (now Attilan Group) and LionGold Corp - collectively known as BAL.

Justice See said in sentencing Goh: "I do not accept that his role was peripheral, much less that he was 'completely dispensable' (as the defence claims) to the scheme. He was clearly entrusted with some authority and powers of oversight, primarily because he was trusted and loyal. The fact that he arranged approximately S$30 million in payments cannot be overstated."

However, the judge also took into account of Goh's remorse as manifested in his guilty plea and consent to four other similar charges to be taken into consideration for sentencing.

Goh was the first to face the music, and he could potentially be a prosecution witness against 59-year-old Soh and 54-year-old Quah when the joint trial of these two Malaysians starts next Monday.

The 2013 penny stock crash has pummelled the brokerages as they were saddled with over S$350 million of unpaid losses as at April 2018, Deputy Public Prosecutor Nicholas Tan told the court on Wednesday.

Goh admitted that at Quah's request, he and his wife opened 10 personal trading accounts at five different brokerages between 2008 and 2011, then ceded control of those accounts to Soh and Quah.

He had also helped to facilitate the creation of another seven personal trading accounts by four individuals and 11 corporate accounts.

Those accounts, as part of a network of 189 accounts that the prosecution said were controlled by Soh and Quah, were used to manipulate the BAL shares, the three counters at the heart of the 2013 crash.

Goh's co-accused Soh and Quah were said to have cornered the market for the BAL shares during the offending period as they were behind 60 per cent of Blumont's total traded volume from Jan 2-Oct 3, 2013, and 88 per cent of Asiason's and 90 per cent of LionGold's from Aug 1, 2012-Oct 3, 2013.

The duo had also allegedly carried out "wash trades" or trading between themselves in the BAL shares via the controlled accounts to create a facade of liquidity and demand for the three stocks, thereby driving the prices of those counters to about four to 31 times of their fair market values by Oct 1, 2013.

But prices of the BAL shares plunged on Oct 4, 2013, lopping off S$8 billion in market value over three days.

Financial institutions including Phillip Securities, Royal Bank of Canada, Goldman Sachs, Interactive Brokers and Saxo Bank suffered S$350 million in unpaid losses stemming from amounts owed as a result of financing backed by the BAL shares and extended to the accounts that Soh and Quah allegedly controlled, and from the contra losses incurred in the accounts.

Besides his role in facilitating the trading accounts to be used, Goh also managed a pool of funds - at times exceeding S$2 million - said to be used by Soh and Quah to pay off contra trading losses in the controlled accounts.

Goh had handled over 1,200 payments and the total value of outgoing payments he made was about S$30 million. He also helped to keep track of the shareholdings held under the various accounts.

The extent of the role Goh played in the scheme was a point of contention between the prosecution and the defence on Wednesday. His lawyer Adrian Wee said his client played a limited role - akin to a back-room function - that was peripheral to the scheme. And Goh had not benefited financially from the offences as he had helped Quah out of misguided loyalty to her.

DPP Tan did not agree, and said: "He (Goh) held the purse string of S$2 million. I don't know any back-room boy who holds that kind of money."

Instead, the prosecution described Goh as the seed funder and finance manager of the scheme, given that his accounts had at least S$4 million in trading limits for the scheme.

Goh, who stood emotionless throughout the hearing, started his three-year jail term immediately, as sought by both the prosecution and the defence.

Tay Peck Gek, Business Times

21 March 2019