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Iris Drops as Malaysian Regulator Sues in Stock Probe |
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Friday, 11 April 2008 15:19 |
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(Bloomberg) -- Iris Corp., the subject of an international stock manipulation probe, fell to a three-week low in Kuala Lumpur after Malaysia's regulator sued U.S. hedge fund Aeneas Capital Management LP for market rigging and fraud.
The maker of digital identity cards dropped 3.6 percent to 13.5 sen at the 5 p.m. close, valuing the Kuala Lumpur-based company at 185 million ringgit ($59 million). Iris, down 34 percent this year, wasn't named as a defendant in the suit.
Crackdowns on market manipulation are rising. Last month, U.S. regulators investigated trading of Bear Stearns Cos. shares after its stock plunged. Malaysia's Securities Commission said it worked with overseas authorities before filing a civil suit against 10 defendants including Aeneas Capital Managing Partner Thomas R. Grossman for creating fake demand for Iris stock.
``The authorities are stepping up efforts to clamp down,'' said Vince Ng, an analyst at Kaf-Seagroatt & Campbell Bhd. in Kuala Lumpur.
The Malaysian regulator said yesterday it wants to ban the defendants from trading any stock on the local exchange.
The filing at the Kuala Lumpur High Court also names Malaysian businessmen Tan Mong Sing and Low Thiam Hock, former chairman of Repco Holdings Bhd., the Securities Commission said. Tan and Low declined to comment yesterday.
Investigators analyzed more than 100 accounts at 15 Malaysian and 16 overseas brokers, and examined more than 200,000 e-mails, the Malaysian regulator said. U.K., Singapore and Hong Kong authorities collaborated in the probe, it said.
Kenneth Breen, a lawyer at Paul, Hastings, Janofsky & Walker in New York who represents Grossman, New York-based Aeneas and its related funds, said yesterday he couldn't immediately comment on the suit.
Grossman formed Aeneas in 2000 after leaving SAC Capital Advisors LLC, Steven Cohen's $10 billion hedge fund company.
``I have no comment as it doesn't involve the company,'' Iris Managing Director Tan Say Jim said by phone late yesterday.
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