Charges for insider trading must exhibit clarity, include necessary details per law, and can be multiple if distinct offences are established.

Introduction

[1] On 29 January 2015, Lei Lin Thai, the applicant, was charged in the Sessions Court at Kuala Lumpur with 53 charges under s 188(2)(a) of the Capital Markets and Services Act 2007 ("the CMSA") and punishable under s 188(4) of the same Act.

[2] All the 53 charges preferred against the applicant are for the offence of acquisition of shares in TH Group Berhad whilst in possession of insider information.

[3] Before the commencement of the trial at the Sessions Court, the applicant filed this notice of motion dated 2 September 2015 seeking from this Court the following orders:

(i) that all the charges preferred against the applicant under s 188(2)(a) of the CMSA and registered as Case Nos: 62-01-01-2015 to 62-18- 01-2015 ("the said charges") at the Kuala Lumpur Sessions Court be struck out;

(ii) that the applicant be discharged and acquitted of all the said charges;

(iii) that all proceedings at the Kuala Lumpur Sessions Court pertaining to the said charges be stayed and/or adjourned pending the final disposal of this application; and

(iv) any other order or relief which this honourable Court deems fair and just.

[4] The grounds to strike out the 53 charges are as follows:

(i) that the criminal charges preferred against the applicant contravened art 8(1) of the Federal Constitution ;

(ii) that the said charges are defective and illegal both in substance and form; and

(iii) that the said charges are oppressive, vexatious and an abuse of the judicial and legal process.

The Applicant's Contentions

Article 8(1), Federal Constitution

[5] As regards the contravention of art 8(1) of the Federal Constitution , it was submitted by the counsel for the applicant that any person who contravene s 188(2) of the CMSA would be liable to two different sets of punishment, namely under s 188(4) which is punishment for criminal offence or under s 201(5) which is recovery for loss and damages by instituting civil proceedings. Therefore, it was argued that since s 188 is a more severe and drastic provision compared to s 201, s 188 is discriminatory.

[6] The counsel for the applicant further contends that there is no guideline provided under the CMSA to indicate as to the class of cases in which s 188 or s 201 is to be resorted to by the authority.

[7] As such, s 188 of the CMSA was submitted as void as it contravened art 8(1) of the Federal Constitution .

Defective And Illegal Charges

[8] On this issue, it was submitted that there is no offence known of "acquiring of shares ... through a third party" under the CMSA. Section 188 (2)(a) which the applicant was charged with only stipulates that an insider shall not acquire any securities. In the present case, as stated in the charges that the securities were acquired through the account of a third party, it was argued that there is no offence revealed and as such, the charges are defective.

[9] The counsel for the applicant submitted further that the correct subsection for this particular offence is subsection (2)(b) of s 188 and not s 188(2)(a). It was submitted that the action of an insider acquiring any securities through a third party falls under s 188(2)(b) read together with the definition of "procure" under s 187 of the CMSA.

[10] Apart from this, it was also argued by the counsel that all the charges has failed to mentioned whether the applicant was charged in his capacity as a principal or agent. As such, the applicant is not in the position to answer the charges in the best way possible.

[11] Furthermore, the applicant's counsel submitted that the charges did not disclose elements of the offence and are vague as it did not reveal which limb of "information" under s 183 of the CMSA in which the applicant was charged. It was argued that as there are six limbs from para (a) to (f) in s 183 and some of the limbs are further subdivided into various types of information, therefore the charges should state clearly under which limb of information which the applicant had contravened. Thus, fai