AmInvestment Bank Berhad

On the court record

An investment bank whose matters address the fishing-expedition limits on discovery against statutory secrecy, and liability for the unauthorised sale of a customer's shares.

AmInvestment Bank Berhad appears in the corpus as a respondent and defendant in disputes concerning share dealings, discovery and a bank's duties, and the matters together sketch the litigation risks of an investment bank. In a Court of Appeal matter a claimant sought discovery against the bank under Order 24 rules 3 and 7 of the Rules of Court 2012; the court weighed whether the discovery application was meritorious or an impermissible fishing expedition, and whether discovery was barred by statutory secrecy under section 43 of the Securities Industry (Central Depositories) Act 1991, against the backdrop of a bank's duty of care to non-customers and the Financial Services Act 2013.

In a High Court matter, OceanCove Sdn Bhd sued the bank and another defendant over the sale of shares. After evaluating the evidence, the court granted relief that included a declaration that the defendants had wrongfully, recklessly or negligently sold 148,500,000 Benalec shares without the plaintiff's authority, and ordered equitable compensation of RM50,000.00 to be paid for the unauthorised sale. That outcome shows the exposure a broker-bank faces where it deals with client securities without authority. A further matter, again involving a claim to recover substantial sums paid to acquire shares in a listed company, revisited the limits of discovery under Order 24, reiterating that discovery will not be ordered where it is shown to be a fishing expedition.

For a reader, the value of the cluster lies in its treatment of two persistent themes: the boundary between legitimate pre-trial discovery and a fishing expedition, especially against statutory secrecy provisions, and a financial institution's liability for unauthorised dealings in a customer's shares. The bank is named as it appears on the record; individual parties are referred to by their procedural role only. The through-line in the bank's matters is the tension between a claimant's legitimate need for information and documents and the statutory and equitable limits that protect confidentiality and prevent abuse: discovery is confined to what is relevant and necessary and denied where it becomes a fishing expedition, while a broker's authority to deal in a customer's securities is strictly construed, unauthorised dealings attracting equitable compensation.