COMMENT | Attorney-General Idrus Harun’s statement explaining why he withdrew the criminal charges against four key officials of listed oil-and-gas company Serba Dinamik Holdings Bhd and instead compounded their offences is shocking, illogical and without proper basis.
Idrus should listen to those who know better, especially the Securities Commission (SC), whose professionals are there to specifically administer the complex Capital Markets and Services Act 2007 (CMSA) to ensure that markets are fair, orderly and transparent and participants play by the rules.
Relaxing the rules selectively for some market participants by using discretion, which is given to the AG for prosecution of all cases in Malaysia, is a complete no-no because the longer-term impact is a loss of confidence in the Malaysian financial markets. This in turn leads to a relative drop in market values compared to markets which investors trust more.
Paradoxically, this is exactly what the AG said he was keen to prevent when he said, “The AGC (the AG’s Chambers) is also of the view that the criminal proceedings against SDHB (Serba Dinamik) ought not to be pursued due to the economic consequences of doing so. The impact of the charges on SDHB is disproportionate with the severity of the alleged offences committed.”
The economic consequences are that there will be an erosion in value of capital markets in the billions of ringgit if there is even the slightest suspicion that market participants can rig the market and get away with it by a mere fine. Market integrity is compromised when the independence of the SC is interfered with needlessly.
It is for this very reason that the SC was set up and...