SC Malaysia Imposes Penalty on Unit Trust Consultant for Securities Violations

The Securities Commission Malaysia (SC) has reprimanded Amran Bin Mohd Amin with a penalty of RM687,500 for multiple breaches of securities laws. The penalty, effective from June 26, 2024, follows an investigation into Amran's activities between January 2022 and January 2023. During this period, Amran misappropriated RM215,000 from four potential investors, funds which were intended for investments in a unit trust fund managed by Kenanga Investors Berhad (KIB). Instead of investing the funds as promised, Amran deposited them into his personal unit trust investment account.

Additionally, Amran provided falsified account statements to two of the investors, falsely indicating that their investments or unit trust purchases had been made. The SC's investigation revealed that these actions breached several provisions under the Capital Markets and Services Act 2007 (CMSA), specifically Section 92A(2)(a), as well as guidelines set by the SC and the Federation of Investment Managers Malaysia's Code of Ethics.

The SC's decision came after a thorough process, allowing Amran to respond to the allegations. As of now, Amran has not requested a review of the SC's decision. This case highlights the SC's ongoing efforts to enforce ethical standards within the capital market and serves as a warning to other unit trust consultants. Since 2020, the SC has taken administrative action against nine individuals for similar misconduct, including accepting personal funds from investors and providing misleading information. The SC has emphasized the importance of honesty and integrity in the financial sector, reminding fund management and unit trust companies of their responsibilities to ensure ethical management and oversight of their consultants. Investors are advised to verify the legitimacy of their financial advisors and to avoid transferring funds to unauthorized accounts.