SGX-DT may suspend an Approved Trader or Registered Representative for a period of up to 1 year if:
1. The sponsoring Member’s trading privileges are suspended;
2. His application for registration contains material errors or omissions or is misleading in a material respect;
3. He is found guilty in a court of law of misconduct or wilful neglect in a manner contrary to the SFA;
4. He is convicted of an offence involving fraud or dishonesty;
5. He files a petition for bankruptcy;
6. His licence from or registration with the MAS is suspended;

It is important to know your customers, both from the perspective of being able to offer the correct products and services to suit their investment needs, as well as to prevent money laundering.
Trading Members must ensure that an account has been opened for each customer before transacting on his behalf or selling any investment product to him. In opening the account, Trading Members have to obtain the particulars of a customer and understand the customer’s investment objectives. This ensures that Trading Members abide by the know-your-customer principle.

For joint accounts, each joint account holder must be at least 18 years old; and no joint account holder is an undischarged bankrupt.

For corporate customers, this would include a certified true copy of the certificate of incorporation of the customer, information about company registration, articles of association, and list of authorised traders.

Examples of SIPs Not Listed on an Exchange
Structured notes (e.g. equity-linked structured notes, credit linked structured notes)

Failure to adhere to requirements around SIPs
FAA-N16
Offences are punishable with a fine not exceeding $25,000, and a further fine of $2,500 for every day or part thereof the offence continues after conviction.

All accounts (whether belonging to customers or the Member itself) must be identified and designated by the full name of the customer and a unique account code.
Members are required to submit to SGX details of any new customer account which is used for trading and/or carrying of trades done on SGX, other exchanges and overthe- counter. This is done using the Form BC4A.

If there are any changes to information stated in a BC4A account that has been submitted previously, SGX must be notified as soon as is practicable, within the next business day.
Members should notify SGX when an account is closed in their system, as soon as is practicable, to prevent unauthorised trading in the account

Banking Act
Any person who contravenes of shall be guilty of an offence and shall be liable on conviction:
1. In the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both; or
2. In any other case, to a fine not exceeding $250,000.

PDPA Impact on Intermediaries Operations
As confidentiality obligations are already in force for Members and their representatives, the PDPA would impact the intermediaries operations especially when disclosures are requested. It also affects Members and their representatives when making marketing calls.

Members should establish clear policies and procedures to comply with the provisions of the PDPA and other confidentiality obligations such as requiring their representatives to:
 Check the DNC registry before making calls
 Seek clear and unambiguous consent
o Via Forms
o Via call scripts
o Violations of DNC policies and procedures will lead to disciplinary actions

PDPC recognizes consent given before 2 Jan 2014 for the sending of specified message, provided that such consent
o Has not been withdrawn by the individual on or after 2 Jan 2014;
o Is clear and unambiguous; and
o Is evidenced in writing or other form so as to be accessible for subsequent reference.

Prohibited trading practices
These include practices such as trading against oneself, and making frivolous quotes.

After a trade has been initiated, Members will “mark-to-market” (MTM) all open positions.
MTM involves comparing the price that the position was entered into, against the current market price. This gives the unrealised profit or loss for the position.
The key concern for the Member is to ensure that the customer is able to meet his/her obligations on unrealised losses.

Total net equity is the remaining amount of funds in a customer’s account, after setting aside the initial margin and additional margin amounts required to support his open positions. This is also known as excess margins. Customers may withdraw excess margins from their accounts, subject to conditions as stipulated by SGX-DT.

II & IV.
Unanswered Margin Calls
In the event the Member is unable to obtain margins from the customer as required under this Rule, the Member may take the necessary actions to rectify the deficiency as it sees fit. These actions could include closing out the customer’s positions. SGX-DT may also order the Member to immediately close all or part of the customer’s positions to rectify the deficiency.
A customer who has an unanswered margin call is only allowed to enter trades that reduce his/her maintenance margin requirements.

I & IV.
A customer is long 3 contracts of MSCI Singapore Index Futures. The market has moved against him and he has been issued with a Margin Call, but he has not yet responded to the Margin Call.
During this time, the Member may:
a) NOT accept orders from the customer to buy MSCI Singapore Index Futures, as this will increase his margin requirements; and
b) Accept orders from the customer to sell MSCI Singapore Index Futures, as this will reduce his margin requirements by closing out his existing positions.

III & IV.
Members shall report open positions in all accounts at the end of each trading day, by submitting Form BC3A. The Form is to be submitted no later than 11:00 a.m. of the following business day. For disclosed omnibus accounts, Members shall report the open positions in each subaccount.
However, if the omnibus accounts holder does not want the identity of any sub-account holder to be disclosed to its carrying Member, the omnibus accounts holder may apply to SGX-DT for a special identification for the sub-account thereof, for reporting open positions covered within this rule through its carrying Member.

I & II.
For the purpose of this section on customer’s moneys and assets, “customer” in relation to the CMS licence holder, does not include:
1. The CMS licence holder in carrying out any regulated activity for its own account;
2. An officer, an employee or a representative of the CMS licence holder; or
3. A related corporation of the CMS licence holder with respect to an account belonging to and maintained wholly for the benefit of that related corporation.

I & III.
Trust and custody accounts must be maintained with:
1. A bank licensed under the Banking Act (Cap. 19);
2. A merchant bank approved as a financial institution under the Monetary Authority of Singapore Act (Cap. 186); or
3. A finance company licensed under the Finance Companies Act (Cap. 108).

II & III.
Custody accounts may also be maintained with:
4. A depository agent within the meaning of section 130A of the Companies Act (Cap. 50) for the custody of securities listed for quotation or quoted on the Singapore Exchange Securities Trading Limited or deposited with the Central Depository (Pte) Ltd;
5. An approved trustee for a collective investment scheme within the meaning of section 289 of the Act; or
6. Any person licensed under the SFA to provide custodial services for securities.

I & IV.
Conditions of custody agreement:
That the custodian shall not claim any lien, right of retention or sale over any asset standing to the credit of the custody account, except:
(a) Where the Member has obtained the customer’s written consent and notified the custodian in writing of the written consent; or
(b) In respect of any charges as agreed upon in the terms and conditions relating to the administration or custody of the asset

II & IV.
Before depositing customers’ monies or assets in the trust or custody account, the Member shall give written notice to the financial institution and obtain an acknowledgment from the financial institution that:
1. All monies and assets deposited in the trust or custody account are held on trust by the Member for its customer and the financial institution cannot use those monies and assets to offset any debt owed by the Member to the financial institution; and
2. The account is designated as a trust or custody account, or a customer’s or customers’ account, which shall be distinguished and maintained separately from any other account in which the Member deposits its own monies and assets

I & III.
There are 2 conditions that have to be satisfied before the Member may mortgage, charge, pledge or hypothecate its customer’s assets. The conditions are that:
1. The sum of the claims to which such customers’ assets are subject as a result of such mortgage, charge, pledge or hypothecation does not exceed the aggregate amounts owed by the customers to the Member; and
2. The claim to which each customer’s assets are subject as a result of such mortgage, charge, pledge or hypothecation does not exceed the amount owed by the customer to the Member.

II & III.
Wash Trades: this occurs when a trader enters into transactions, either with another collaborator or using different accounts he controls. There is no real economic value to the trade. The trades are merely done to create the impression of volume.

III & IV.
Manipulation of futures price and cornering
Offences are punishable with a fine not exceeding $250,000 and/or imprisonment for up to 7 years.

I & II.
Orders under the following circumstances will be permitted:
(a) Orders from a fund manager whose instructions are intended to switch the security from one sub-account to another for legitimate commercial reasons; or
(b) Orders from an affiliate overseas, acting on behalf of different beneficial owners, and the trades will be booked out eventually to these beneficial owners

II & IV.
SFA Part XII Market Conduct Division 1 Prohibited Conduct – Securities
Any person who contravenes any provisions of this Division shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 or to imprisonment for a term not exceeding 7 years or to both

I & IV.
It is not possible to define all the possible “fraudulent devices” since criminals are always inventing new way to deceive their victims, but some examples are:
 Using any device, act, practice or scheme to deceive customers and market participants is prohibited; or
 Making any false statement or omitting to state a material fact.
A recent infamous case of fraudulent practice was the Ponzi scheme by Bernard Madoff.

II & III.
Exceptions
The following cases will not be considered Insider Trading:
 The redemption of units by trustees or managers in respect of a collective investment scheme, subject to certain conditions (SFA Section 222);
 Persons acting as underwriters and pursuant to the performance of their roles (SFA Section 223);
 The purchase or sale of securities pursuant to legal requirements, such as requirements imposed by written law or court order (SFA Section 224);
 Price-sensitive information communicated pursuant to legal requirements, such as requirements imposed by written law or court order SSFA Section 225);
 Knowledge by virtue of a natural person’s own transactions; and
 Knowledge of a corporation’s own transactions