On 9 April 2026, the Attorney-General’s Chambers, the Singapore Police Force and the Monetary Authority of Singapore issued a joint statement confirming that the Court of Appeal had, on 18 March 2026, upheld the convictions and sentences handed down to Mr Soh Chee Wen and Ms Quah Su-Ling for orchestrating what the authorities described as the largest market manipulation case in Singapore’s history, the scheme to manipulate the shares of Blumont Group Ltd, Asiasons Capital Ltd and LionGold Corp Ltd around 2013. A few weeks later, on 26 May 2026, a much smaller and unrelated matter was resolved by guilty pleas: Mr Wong Chow Lin admitted to trading in the shares of SGX-Catalist listed Eurosports Global Limited for the purpose of artificially increasing the share price, and his former trading representative, Ms Gillian Isabel Siow Siang Sok, admitted to intentionally aiding him. Despite the very different scale of the two matters, both turned on the same provision: section 197 of the Securities and Futures Act 2001 (SFA), Singapore’s false trading and market rigging offence.
For SGX-listed companies, their directors, and anyone who trades their own listed shares, section 197 is one of the more consequential provisions in the SFA precisely because it does not require proof of a completed fraud on any particular victim. It targets the creation of a false appearance in the market itself. This article explains what the offence covers, who can be caught by it, how MAS and the Commercial Affairs Department (CAD) investigate, and what a company or its officers should expect if a false trading matter reaches them.
What Section 197 False Trading Is
Section 197 sits in Part XII of the SFA, the part dealing with market conduct. It is one of several market misconduct provisions, alongside insider trading, that exist to protect the integrity of price formation on an organised market such as the SGX Mainboard or SGX-Catalist.
In broad terms, false trading and market rigging happens when a person does something, or engages in a course of conduct, that creates (or is likely to create) a false or misleading appearance of active trading in a listed counter, or a false or misleading appearance with respect to the market for, or the price of, that counter. It does not matter whether the trades are “real” in the sense that money and shares actually change hands. A series of genuine, matched trades between accounts controlled by the same person, timed and priced to give onlookers the impression of independent market demand, falls squarely within the offence.
Why this matters for SGX-listed companies specifically
Listed companies and their officers are exposed to section 197 in two distinct ways. First, an officer, substantial shareholder or their associate may personally trade in the company’s own shares in a manner that inflates or supports the price, often to avoid margin calls on shares pledged as collateral, to influence a placement price, or to make the counter appear liquid to attract other investors. This was the pattern in the Eurosports Global matter: Mr Wong held Eurosports shares as the bulk of the collateral pledged to his brokerage, and the manipulative trading was aimed at avoiding margin calls and improving his margin valuations. Second, a company can be drawn into a false trading investigation indirectly, where its shares are the instrument used by outside parties, and its officers are asked to account for disclosures, corporate actions or announcements that coincided with the manipulative trading, as happened with Blumont, Asiasons and LionGold, where an extensive web of trading accounts was used to manipulate all three counters over an extended period.
Legal Basis: The Statute and What It Actually Says
Section 197(1) of the SFA provides, in substance, that no person shall do anything, cause anything to be done, or engage in any course of conduct, if a purpose (or one of the purposes) of doing so is to create a false or misleading appearance of active trading in capital markets products on an organised market, or a false or misleading appearance with respect to the market for, or the price of, such products.
Section 197(1A) adds a knowledge or recklessness limb: a person must not do anything that creates, or is likely to create, a false or misleading appearance of active trading, or of the market for or price of capital markets products on an organised market, where that person knows or is reckless as to whether the act will create that false or misleading appearance. This is the limb that catches conduct even where a specific manipulative “purpose” is harder to prove directly, because it can be inferred from what the person knew, or ought to have known, about the likely effect of their trading pattern.
Section 197(1)(b) specifically catches a person who intentionally aids, abets, counsels or procures another person to do anything that creates or is likely to create such a false or misleading appearance. This is the limb under which a trading representative or other intermediary who knowingly facilitates a client’s manipulative trading, rather than executing it themselves, can be independently liable. Read together, sections 197(1), (1A) and (1)(b) mean that both the principal who orchestrates the scheme and anyone who knowingly assists it can each face liability. For the exact statutory wording currently in force, always check the consolidated text of the Securities and Futures Act 2001 on Singapore Statutes Online rather than relying on a secondary summary, since the SFA has been amended several times since 2001.
How this differs from the general SFA framework
Our earlier chapter-by-chapter explainer of the SFA and its companion piece on common SFA compliance mistakes cover the Act’s licensing and disclosure framework broadly. Section 197 sits apart from that licensing architecture: it is a market conduct offence that applies to anyone trading on an organised market, licensed or not, and it can be prosecuted criminally or pursued as a civil penalty matter, which is a materially different exposure to a licensing breach.
Who Can Be Liable
Liability under section 197 is not confined to the person who places the manipulative orders. Recent cases illustrate a wide net:
- The principal trader. The individual who directs or personally executes the trades intended to create a false appearance of activity or price, whether trading through their own account, nominee accounts, or accounts of associates.
- Company officers and controlling shareholders. A director, chief executive or substantial shareholder who trades in, or arranges for others to trade in, the company’s own listed shares to support the price, particularly where shares are pledged as collateral for margin financing and the officer has a personal incentive to avoid a margin call.
- Trading representatives and intermediaries. Under section 197(1)(b), a remisier, dealer’s representative or other intermediary who knowingly assists the scheme, for example by monitoring margin thresholds and advising on price levels needed to avoid a call, can be independently convicted even though they were not the beneficial owner of the shares. This is exactly what happened to Ms Siow, a former trading representative who was convicted of intentionally aiding Mr Wong’s false trading in Eurosports Global shares by monitoring his margin levels and calculating the price levels at which margin calls would be triggered.
- Associates using multiple accounts. Where a scheme relies on a web of trading accounts to disguise common control, everyone who knowingly lends their account or identity to the scheme is potentially exposed, not only the person who benefits financially. The Blumont, Asiasons and LionGold scheme, for example, involved an extensive network of trading accounts used to create an artificial impression of independent market demand across all three counters.
The common thread is that section 197 does not require the accused to have personally profited from a completed transaction with a third party. It is enough that the conduct was intended, known, or reckless as to whether it would create a false picture of trading activity or price.
How MAS and CAD Investigate
MAS carries out day-to-day market surveillance of SGX trading, using automated pattern detection to flag unusual trading in a counter, such as spikes in volume without corresponding news, concentrated trading among a small cluster of accounts, or price movements around known collateral thresholds. SGX itself also has front-line surveillance obligations under its rulebook and can refer suspicious trading to MAS. MAS publishes its enforcement actions, including false trading matters, which is a useful reference point for the kinds of conduct that have attracted scrutiny in practice.
Where the pattern warrants deeper scrutiny, MAS and the police’s Commercial Affairs Department typically work jointly, since false trading can be prosecuted criminally, pursued as a civil penalty action, or both. Investigation usually involves obtaining trading records and account-opening documents from brokers, tracing beneficial ownership behind nominee or third-party accounts, examining communications between the alleged principal and any intermediary, and analysing whether the trading pattern is consistent with genuine independent market activity. Suspects and witnesses are interviewed under caution, and charges or a civil penalty notice follow only after this evidentiary picture is assembled, which is why these matters can take years to conclude.
Documents and Evidence Typically Involved
| Evidence category | What it typically shows |
|---|---|
| Broker trading records and contract notes | Timing, size, price and counterparty of each trade in the counter under investigation |
| Account-opening and KYC documents | Who actually controls an account, including nominee or third-party arrangements |
| Margin financing and collateral records | Whether shares in the counter were pledged as collateral, and the margin call thresholds the accused had an incentive to avoid |
| Communications (calls, messages, emails) | Instructions between an alleged principal and any trading representative or intermediary, including price-level discussions |
| SGX and MAS surveillance data | Automated flags on abnormal volume, price movement or account clustering that triggered the initial review |
| Corporate disclosures and announcements | Whether company announcements coincided with, or were used to support, the trading pattern |
Penalties, Timelines and Costs of Defending Such a Matter
Section 197 can be enforced through the criminal route under section 204 SFA, or through the civil penalty regime under section 232 SFA, and MAS has discretion as to which route (or both) it pursues.
| Regime | What it involves | Typical duration |
|---|---|---|
| Criminal penalties (section 204 SFA) | Prosecution before the courts; on conviction, exposure to a fine, imprisonment, or both, with the severity scaled to the harm caused and the accused’s role. At the most serious end, the masterminds of the Blumont, Asiasons and LionGold scheme were sentenced to decades of imprisonment each, sentences the Court of Appeal upheld in March 2026. At the other end of the scale, a single false trading offence resolved by an early guilty plea, as in the Eurosports Global matter, has resulted in a short custodial term, while a person convicted only of intentionally aiding under section 197(1)(b) has been dealt with by way of a substantial fine rather than imprisonment | Investigation to trial can span several years; appeals to the Court of Appeal add further time before a matter is finally resolved. The Blumont/Asiasons/LionGold appeals process alone ran well over a decade from the underlying 2013 trading to the final Court of Appeal decision |
| Civil penalty regime (section 232 SFA) | MAS may bring a civil penalty action in court, or accept a civil penalty in lieu of court proceedings, without requiring the criminal standard of proof; outcomes include financial penalties and, in some cases, prohibition orders restricting a person’s ability to work in the securities industry | Generally faster than a full criminal trial, but can still run well over a year where the underlying facts are contested |
| Defence costs | Legal fees for a contested false trading matter, particularly one involving forensic tracing of multiple accounts, are substantial and rise sharply if the matter proceeds to trial and then to appeal | Ongoing throughout investigation, any charge, trial and appeal stages |
What Happens After a Conviction or Civil Penalty Order
A conviction or civil penalty order under section 197 rarely ends the matter. Consequences that commonly follow include:
Director disqualification exposure
A director convicted of an offence involving fraud or dishonesty, or who is the subject of certain civil penalty findings, can face disqualification from acting as a director of any Singapore company. Where disqualification is in issue, the individual’s other directorships, not just the listed company connected to the false trading, are affected. Our article on shadow director liability in Singapore covers related exposure for individuals who continue to direct a company’s affairs informally after stepping down from a formal directorship, a pattern that can arise once disqualification proceedings begin.
SGX listing consequences
Separately from any court or MAS action against the individual, SGX can take its own disciplinary action against the company or its officers under the listing rules, which may include public reprimands, directions, or, in serious cases, action affecting the counter’s continued listing status. A conviction or adverse civil penalty finding against a current officer will also typically require disclosure to the market and can affect the company’s ability to raise capital or maintain banking and broker relationships.
Frequently Asked Questions
Does section 197 require someone else to have lost money?
No. The offence is concerned with creating a false or misleading appearance in the market itself. A completed loss to an identifiable victim is not an element of the offence, although actual market impact is relevant to sentencing and to any civil penalty assessment.
Can trading through genuinely separate accounts still be false trading?
Yes, if those accounts are in substance controlled by, or coordinated on behalf of, the same person or group, and the trading is designed to create a false impression of independent market activity. The number of accounts used does not change the character of the conduct.
Is a company itself at risk, or only the individuals involved?
Section 197 targets the person who does the act, which is usually an individual. However, the listed company can face separate SGX disciplinary consequences, disclosure obligations, and reputational damage even where no charge is brought against the company as a corporate entity.
What should a director do if they suspect unusual trading in their own company’s shares?
Seek advice promptly, avoid any communication that could be read as coordinating or encouraging the trading pattern, and consider whether any disclosure obligations to SGX are triggered. Do not attempt to investigate informally in a way that risks destroying or altering records that MAS or CAD may later need.
How is section 197 different from insider trading?
Insider trading concerns trading or tipping on the basis of price-sensitive information that is not generally available. False trading concerns manipulating the appearance of the market itself, regardless of whether inside information was involved. The two can overlap but are separate offences.
Can AI-generated legal research be trusted when checking cases like these?
Not without independent verification. Case names, section numbers and outcomes should always be checked against the primary source before being relied on in any filing or advice; our article on fabricated case citations in Singapore courts explains why this matters and what has gone wrong when it is skipped.
Need Help With This Matter?
If your company is facing this situation, Raffles Corporate Services can assist with the groundwork: ACRA filings, compliance documentation, and coordinating with experienced Singapore law firms. For matters requiring court proceedings, we work with a panel of experienced Singapore law firms who offer cost-effective and efficient legal service and advice.
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This article is for general information only and does not constitute legal advice. For advice specific to your situation, please consult a qualified Singapore Advocate and Solicitor.