Fox is the managing director of CO Bhd. Fox contemplates that the share price of CO Bhd quoted on the stock exchange will rise considerably as soon as the company announces its plan to enter into a joint venture with WDesniy to transform its existing theme park to a Desniy branded theme park. WDesniy owns the world most popular cartoon characters, Desniy. Fox had secretly requested his fiance, Micky to subscribe to a large number of CO Bhd's shares in the market on his behalf and she did. Micky also shared this information with her brother, Mike who then bought some shares of CO Bhd through the stock exchange too.

Unfortunately, after the announcement of the joint venture, the share price of CO Bhd surged up a little initially but plunged down to more than 30% following a newspaper report alleging that the joint venture agreement was secured by CO Bhd through bribing one of the directors of WDesniy.

To maintain its reputation, WDesniy immediately wrote to CO Bhd to terminate the joint venture agreement. After receiving the notice of termination, CO Bhd did not make any public announcement through the stock exchange. Instead, Fox called for a press conference and he assured the public that the joint venture agreement was secured through proper negotiation.

An hour before the press conference, Fox posted on his Facebook and Instagram accounts, a photo framing Robert Earl, Planet Hollywood's founder and Fox who were having coffee together. When asked by the reporter whether there is any dealing between CO Bhd and Planet Hollywood, Fox smiled and said "just wait for the announcement". Fox knew very well that there was no discussion on any collaboration between CO Bhd and Planet Hollywood.

In fact, that photo was taken 3 years ago where Fox met Robert on a cruise where Mike was with Fox and Micky on the cruise at that time too.

The next day after the press conference, a press reported on its business column "CO secured deal with Planet Hollywood." The reporter is Mike. CO Bhd's share price raised significantly after the news is released and Micky and Mike sold their shares of CO Bhd immediately with a profit.

(a) Examine in detail the securities industry offences that Fox, Micky and Mike most likely have committed. (30 marks)

(b) Consider the possible actions that the Securities Commission may take against Fox, Micky, and Mike. What would be the consequences if such actions are taken? (10 marks)