Public Prosecutor v Tan Seo Whatt Albert: Securities and Futures Act - Offering Securities Without Prospectus
In Public Prosecutor v Tan Seo Whatt Albert, the High Court of Singapore heard cross-appeals against the sentence imposed on Tan Seo Whatt Albert, a manager of Gold Insignia LLP, who pleaded guilty to 20 charges of consenting to Gold Insignia offering securities to investors without a prospectus, violating the Securities and Futures Act. The High Court allowed the Prosecution's appeal and dismissed the Accused's appeal, imposing four weeks' imprisonment per charge, with a global custodial sentence of 12 weeks' imprisonment.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Prosecution's appeal allowed; Accused's appeal dismissed. The court imposed four weeks' imprisonment per charge, with a global custodial sentence of 12 weeks' imprisonment.
1.3 Case Type
Criminal
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Cross-appeals against the sentence imposed on Tan Seo Whatt Albert for consenting to Gold Insignia offering securities without a prospectus, violating the Securities and Futures Act.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Public Prosecutor | Appellant | Government Agency | Appeal Allowed | Won | Nicholas Khoo, Suhas Malhotra |
| Tan Seo Whatt Albert | Respondent | Individual | Appeal Dismissed | Lost | Foo Cheow Ming |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Hoo Sheau Peng | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Nicholas Khoo | Attorney-General’s Chambers |
| Suhas Malhotra | Attorney-General’s Chambers |
| Foo Cheow Ming | Foo Cheow Ming Chambers |
4. Facts
- Tan Seo Whatt Albert was a manager of Gold Insignia LLP.
- Gold Insignia offered debentures, structured as 'memberships,' without a prospectus.
- Investors received a gold bar worth about 70% of the membership fees, held on trust for Gold Insignia.
- Investors were promised fixed pay-outs of 4.5% per quarter or 6% bi-annually.
- Gold Insignia sold 853 memberships to 547 investors, raising $29,970,000 between June 2010 and November 2011.
- The Accused was the senior-most member of the management team of Gold Insignia and had the final say in its management.
- The Accused was paid a monthly salary of $20,000 and 'Partial Consultant fees' of $211,000 in 2011.
5. Formal Citations
- Public Prosecutor v Tan Seo Whatt Albert and another appeal, Magistrate’s Appeal Nos 9242 of 2018/01 and 9242 of 2018/02, [2019] SGHC 156
6. Timeline
| Date | Event |
|---|---|
| Gold Insignia sold memberships | |
| Jacinta Ong Pei Yuen registered as partner of Gold Insignia | |
| Accused paid monthly salary of $20,000 | |
| Chan Noi Eng invested $100,000 | |
| Gold Insignia's in-house trading team set up | |
| Jacinta Ong Pei Yuen deregistered as partner of Gold Insignia | |
| Accused was the acting CEO of Gold Insignia | |
| Khoo Lee Yak invested $50,000 | |
| Gold Insignia sold memberships | |
| Ray joined the management team of Gold Insignia | |
| Gold Insignia ceased making pay-outs to investors | |
| Accused paid monthly salary of $20,000 | |
| Gold Insignia members who wished to terminate their membership were informed that the management may not be able to deal with all requests and return all monies immediately | |
| Gold Insignia sold memberships | |
| Accused adjudged bankrupt | |
| District Judge’s grounds of decision in Public Prosecutor v Tan Seo Whatt Albert [2018] SGDC 247 | |
| Hearing date | |
| Hearing date | |
| Hearing date | |
| Judgment reserved |
7. Legal Issues
- Offering securities without a prospectus
- Outcome: The court found the accused guilty of consenting to Gold Insignia offering securities without a prospectus, violating the Securities and Futures Act.
- Category: Substantive
- Sentencing for offering securities without a prospectus
- Outcome: The court imposed four weeks' imprisonment per charge, with a global custodial sentence of 12 weeks' imprisonment.
- Category: Procedural
8. Remedies Sought
- Review of sentence
9. Cause of Actions
- Violation of s 331(3A) read with s 240(1) of the Securities and Futures Act (Cap 289, 2006 Rev Ed)
10. Practice Areas
- Securities Law
- Criminal Litigation
11. Industries
- Financial Services
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Public Prosecutor v Tan Seo Whatt Albert | District Court | Yes | [2018] SGDC 247 | Singapore | The judgment refers to the District Judge's grounds of decision for the facts of the case. |
| Public Prosecutor v UI | Court of Appeal | Yes | [2008] 4 SLR(R) 500 | Singapore | Cited for the principle that an appellate court will be slow to disturb a sentence imposed except in specific circumstances. |
| Abdul Ghani bin Tahir v Public Prosecutor | High Court | Yes | [2017] 4 SLR 1153 | Singapore | Cited for guidance on the meaning of 'consent', 'connivance', or 'neglect' in the context of criminal liability. |
| Attorney General’s Reference (No. 1 of 1995) | Not Available | Yes | [1996] 1 WLR 970 | England and Wales | Cited for the exposition on the constituent requirement of 'consent'. |
| Auston International Group Ltd v Public Prosecutor | High Court | Yes | [2008] 1 SLR(R) 882 | Singapore | Cited for sentencing guidance in a comparable offence, s 253(1) of the SFA. |
| Krishnan Chand v Public Prosecutor | High Court | Yes | [1995] 2 SLR 291 | Singapore | Cited for the principle that ignorance of the law is no excuse. |
| Re Cashin Howard E | Not Available | Yes | [1987] SLR(R) 643 | Singapore | Cited for the principle that ignorance of the law is no excuse, but that does not make every breach of the law a wilful one. |
| Public Prosecutor v Raveen Balakrishnan | Court of Appeal | Yes | [2018] 5 SLR 799 | Singapore | Cited for the totality principle. |
| Public Prosecutor v Choong Kian Haw | High Court | Yes | [2002] 2 SLR(R) 997 | Singapore | Cited regarding the suitability of fines as a means of punishment for bankrupts. |
| Tan Beng Chua v Public Prosecutor | High Court | Yes | [2014] 3 SLR 1274 | Singapore | Cited regarding the suitability of fines as a means of punishment for bankrupts. |
| Levy v Abercorris Slate and Slab Company | Not Available | Yes | Levy v Abercorris Slate and Slab Company (1887) Ch D 260 | England and Wales | Cited in the SOF for the definition of 'debentures'. |
| Huckerby v Elliot | Not Available | Yes | Huckerby v Elliot [1970] 1 All ER 189 | England and Wales | Cited for the difference in culpability between 'neglect' and 'consent or connivance'. |
| R v Chargot Ltd (trading as Contract Services) and others | Not Available | Yes | R v Chargot Ltd (trading as Contract Services) and others [2009] 1 WLR 1 | England and Wales | Cited for the test for proving 'consent'. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 331(3A) | Singapore |
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 240(1) | Singapore |
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 240(7) | Singapore |
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 239(1) | Singapore |
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 239(3) | Singapore |
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 243(1)(a) | Singapore |
| Securities and Futures Act (Cap 289, 2006 Rev Ed) s 243(3) | Singapore |
| Criminal Procedure Code (Cap 68, 2012 Rev Ed) s 307(1) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Securities
- Prospectus
- Debentures
- Memberships
- Gold bar collateral
- Fixed pay-outs
- Consent
- Negligence
- Materiality
- Investor protection
15.2 Keywords
- Securities and Futures Act
- Prospectus
- Debentures
- Criminal sentencing
- Consent
- Negligence
16. Subjects
- Securities Regulation
- Criminal Law
- Sentencing
17. Areas of Law
- Criminal Law
- Statutory Offences
- Securities and Futures Act
- Criminal Procedure and Sentencing