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SGX regulators lashed for ‘spectacular failure’ surrounding the rise and fall of Noble Group

SGX regulators lashed for ‘spectacular failure’ surrounding the rise and fall of Noble Group

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Iceberg Research, the organisation that triggered the downfall of Asian commodities giant Noble Group, has issued its first report in six months, lashing out at the “spectacular failure” of the regulatory environment of the Singapore stock exchange.

Hong Kong-based Noble Group has seen its share price on the Singapore Exchange plunge 78% this year, following double-digit declines in 2016 and 2015 when Iceberg Research first surfaced with a clutch of damaging reports about the financial set up of what used to be Asia’s largest commodities trader.

Iceberg Research has consistently claimed Noble, like Enron a decade earlier, fabricated profits by inflating the value of contracts secured by billions of dollars. Noble Group has refuted these allegations and even brought a lawsuit against Iceberg Research.

Iceberg Research’s latest report, published today, lays the blame for this alleged accounting malpractice squarely on the shoulders of Singapore’s regulators.

“The Noble saga reveals the complete failure of the regulators in Singapore,” Iceberg maintained, concluding: “There will be other Nobles in Singapore. It is simply too easy to raise money there based on financial misrepresentations, and do it with impunity. This fiasco reveals the spectacular failure of the regulatory environment of the Singapore stock exchange.”

SGX officials have yet to reply to questions sent by Splash earlier today.

Commenting on today’s report, Julie O’Connor, a long-term campaigner for greater transparency among Singapore-listed entities, told Splash: “This article has come as no surprise to me in relation to the SGX or any other watchmen in Singapore. Recently I have written an open letter to the president of the republic of Singapore to express my concerns, my next step will be to write an open letter to the attorney general, I do not intend to allow this matter to rest.”

Under new management, Noble has recently unveiled plans to slash its staff to just 400 in its latest bid to carry on functioning.

Iceberg Research however believes that the company, originally founded by Richard Elman in 1986, will not survive.

“Noble is sinking in a perfect storm. The company is walking toward bankruptcy and liquidation. Its cost of fund is prohibitive. Noble is losing the confidence of its counterparties and of its banks. Key traders are leaving. The stock price is now down 96% since our first report,” the research outfit maintained.

Credit rating firm Moody’s today downgraded Noble on liquidity risks.

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Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

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