In a significant ruling that reinforces Malaysia’s regulatory stance on insider trading, the Federal Court has unanimously dismissed an application by Dato’ Raymond Yap Wee Hin, former Deputy Chairman of Patimas Computers Berhad, to appeal a prior decision that found him liable for insider trading.
The decision, delivered by a panel comprising Chief Justice Tun Tengku Maimun binti Tuan Mat and Federal Court Judges Datuk Vazeer Alam bin Mydin Meera and Dato’ Lee Swee Seng, effectively closes Yap’s legal avenues to challenge the earlier rulings made by both the Court of Appeal and the High Court.
Yap’s leave application stemmed from the Court of Appeal’s decision on 27 November 2024, which upheld the High Court’s finding that he had engaged in insider trading involving 43.8 million Patimas shares in 2012.
Breach of Capital Markets Law
In a civil suit filed by the Securities Commission Malaysia (SC) in 2020, Yap was accused of breaching Sections 188(2)(a) and (b) of the Capital Markets and Services Act 2007 (CMSA). The SC contended that Yap, while in possession of material non-public information, had sold shares belonging to Law Siew Ngoh, then Managing Director of Patimas, between June and July 2012.
The insider information pertained to audit queries and suspicious transactions between Patimas and its top debtors. These issues had been raised by the company’s external auditors in a meeting with senior management. The company later confirmed the seriousness of the concerns in an announcement to Bursa Malaysia on 31 July 2012, stating it would not be able to release its Annual Audited Financial Statements for the period of 1 January 2011 to 31 March 2012 due to unresolved audit findings.
Significant Penalties Imposed
Following a full trial, the High Court had ordered Yap to pay RM3.28 million in disgorgement—equivalent to three times the amount of losses avoided through the illegal trades—and a civil penalty of RM1 million. Additionally, Yap was barred from serving as a director of any public-listed company for five years from the date of judgment, which was delivered on 7 April 2022.
With the Federal Court’s latest decision, those penalties remain firmly in place. Yap was also directed to pay RM30,000 in legal costs to the SC.
Regulatory Signal
The ruling marks a win for the Securities Commission and sends a strong message about the legal consequences of insider trading. The outcome underscores the judiciary’s support of robust market conduct enforcement and the importance of upholding transparency and accountability in Malaysia’s capital markets.
