Published October 15, 2008
Anthony Soh denounced, OCBC rapped over Jade saga
SIC comes down hard on Soh; OCBC takes break from takeover advisory
By CHEW XIANG

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(SINGAPORE) Anthony Soh and OCBC Bank were yesterday censured by the Securities Industry Council (SIC) for their role in the botched takeover of Catalist-listed Jade Technologies. Law firm Allen & Gledhill, which advised Dr Soh, also did not escape blame.
The stunning fallout of the SIC's findings is that, without admitting liability in law, OCBC and Allen & Gledhill lawyer Steven Loh have voluntarily decided to abstain from takeover work for six months, starting Sept 1.
Dr Soh, meanwhile, has been barred from making any takeover offers in Singapore or sitting on the board of any Singapore-listed company for five years.
Yesterday, the SIC released its 86-page findings, shedding some light on one of the most convoluted takeover sagas in recent history. The SIC administers and enforces the non-statutory Singapore Code on takeovers and mergers.
On April 4, Dr Soh was forced to withdraw his 22.5 cent a share offer, worth $116 million in all, shocking other investors who saw their holdings soon plunge in value. The stock is now trading at 4.5 cents.
OCBC was the financial adviser to Dr Soh in the affair, but abruptly quit on April 2. Investors wondered then how it was allowed to discharge itself and said that the offer was trusted only because OCBC had signed off on it.
The bank later reported the matter to the police, alleging it had received false representations.
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Yesterday, the SIC's five-man hearing committee said Dr Soh was found to have 'committed multiple and serious breaches of the code'. It said he was 'far too casual' in approaching his obligations as an offeror.
As punishment, the SIC said that it was prohibiting him from making a takeover offer in Singapore for five years from yesterday.
Dr Soh is also denied the facilities to buy and sell shares through Singapore Exchange Securities Trading Limited without the SIC's consent for the next three years. The SIC added that it 'considers Dr Soh unsuited to be a director of any company listed in Singapore for a period of 5 years' from yesterday.
OCBC too was censured for 'serious lapses' which led to 'multiple breaches of the code'. OCBC said yesterday that 'without admission as to liability in law' it will be voluntarily abstaining from financial advisory work on takeovers for six months from Sept 1.
It will also donate up to $1 million to 'sponsor education programmes in fraud awareness and detection', the bank said in a press statement.
In its statement, OCBC sought to draw attention to the forgery of a funds confirmation document used by Dr Soh to demonstrate that he had the funds for the offer. OCBC said a complaint on the matter was lodged with the Commercial Affairs Department, the white-collar crime unit, and claimed in its submission to the SIC that it was 'a victim of fraud perpetrated by the primary wrongdoer, Dr Soh'.
Allen & Gledhill, the legal advisers to Dr Soh on the takeover, were also found to have breached certain parts of the code, in particular that they failed to verify a securities lending agreement that saw Dr Soh pledging a large block of his shares to Opes Prime, an Australian brokerage.
When Opes failed late in March, Merrill Lynch, as a creditor, seized most of the Jade shares. Dr Soh has initiated action in Australia for the return of the seized shares.
However, Allen & Gledhill lawyer Steven Lo, the partner in charge of advising Dr Soh on the offer, was blamed for less than thorough work in ascertaining that ownership of the shares remained with Dr Soh.
Mr Lo has volunteered to abstain from any takeover work for the six months from September, and had on his own accord not accepted such work since April 11. Like OCBC, he did not admit any legal liability.
Merrill Lynch, which failed to declare its holdings in Jade after it had seized them, and also failed to declare the sale of almost 100 million Jade shares on April 1, before the rest of the market was aware the takeover may collapse, was found to have breached the takeover code, but no other action was taken.
This is not the first time that OCBC's corporate finance team has landed on the wrong side of the authorities. In 1998, the bank sacked two senior executives for their part in the Mid-Continent scandal.
The company was delisted from Sesdaq after it was discovered that 96.5 per cent of its initial public listing shares were placed in the hands of just five investors.
OCBC was rapped then by the Stock Exchange of Singapore for not exercising greater care in carrying out its duties.
Dr Soh flew to Melbourne yesterday to attend a meeting of Opes creditors. He could not be contacted for comment.