SINGAPORE, May 8 — The first private bank representative who took the stand on the 11th day of the 2013 penny stock crash joint trial here today said, his company eventually had to write-off outstanding trade losses which amounted to S$5,611,372 (RM23.3 million).

Martin Thurnham who is presently Coutts & Co Ltd, Hong Kong branch chief executive said there was one account involved in this case that was held at Coutts which was registered under Alethia Elite Ltd with two signatories and one authorised representative.

The account was opened for trading investments supported by lending provided by Coutts with shares in Blumont Group Ltd and Asiasons Capital Ltd provided as margin security. 

On October 4, 2013, the day of the crash, both shares plummeted, and trading of these shares was suspended.

"This led to a margin call for the account, but the margin shortfall was not addressed by the account holder. Steps were then taken to liquidate the account holder’s holdings in the above shares,” he said in his conditioned statement which he is authorised to make on behalf of Coutts.

Thurnham was the chief operating officer of Coutts for the Hong Kong and Singapore branches from April 9, 2016 to September 30, 2017.

Thurnham said subsequent follow-up with the account holder did not address the losses incurred, with Coutts’ maximum loss being S$8,581,406.70, which was later reduced to S$5,611,372 after the sale of shares.

"Legal action was taken against the account holder and it was eventually wound up,” the British national said.

According to Thurnham, bankruptcy proceedings were also commenced in Malaysia against one of the signatories, Cheng Wah, but these proceedings were eventually discontinued.

The joint-trial involves Malaysian businessman John Soh and his co-accused Quah Su-Ling, both of whom pleaded not guilty to 189 and 178 charges respectively, in relation to Asiasons, Blumont, and LionGold Corp’s stocks crash.

Thurnham, the fifth witness, stated that Coutts was unaware if the account was controlled by unauthorised persons.

He said as far as Coutts was aware, all orders and trades in the account were instructed by either the account holder or the authorised person, and no one else.

"We did not consent to John Soh, Quah Su-Ling, or anyone else other than the account holder or authorised person giving instructions in respect of the account, whether directly or indirectly.

"If we had known that Soh, Su-Ling or anyone else other than the account holder or authorised person were doing so, we would have blocked the account and investigated the matter. We might also have filed a suspicious transaction report, and if necessary, a police report,” he said.

The hearing, which had so far called in four trading representatives as witnesses, continues tomorrow. — Bernama