Commentary: Rules preventing public servants’ misuse of confidential information must be stricter – for their own good

Amid concerns over public servants using confidential information for personal gain, it should be noted that no illegal activity has been confirmed thus far. However, the prospect of such misconduct, even if undisclosed, is troubling, according to seasoned journalist Han Fook Kwang. In Singapore, the police are investigating eight public servants who may have leveraged insider knowledge to purchase properties close to MRT stations for personal advantage.

While no wrongdoing has been substantiated, Chan Chun Sing, the coordinating minister for public service, disclosed in parliament that out of 191 cases identified, these eight individuals have been selected for further scrutiny. This revelation has heightened apprehension and sparked questions about the scope of the issue, the potential number of cases, existing safeguards, and the implications for public service integrity.

MPs raised these concerns, yet Chan could not provide elaborate answers at the time, focusing instead on the importance of public servants declaring their property holdings and seeking approval when encountering non-public information relevant to their proposed transactions. The incident initially came to light when the National Bureau of Economic Research, based in the United States, discovered that Singaporean civil servants were disproportionately represented among property buyers near MRT stations before their locations were made public.

It remains uncertain whether these illicit transactions transpired undetected for an extended period.

Nonetheless, the concept of public servants exploiting confidential information for private monetary profit is not novel. Public services worldwide grapple with this issue, given the possession of valuable data that many would be eager to obtain. Singapore's extensive involvement in various aspects of life and market-driven prices intensify the value of insider information.

For instance, knowing that Certificate of Entitlement (COE) supply would diminish at a particular date before it was publicly disclosed would yield significant benefits or that stamp duty on property transactions would increase. How can one protect the confidentiality of sensitive information and prevent its misuse by public officers?

Chan mentioned several safeguards, such as limiting information to those who need it and implementing security classifications. Since 1990, officers have been mandated to declare their property acquisitions, with annual declarations required for non-owner-occupied properties. Furthermore, they must obtain approval from their superiors if they possess non-public information related to a transaction they intend to execute.

These measures are reasonable; however, the crucial question lies in their enforcement. Who examines these declarations to uncover any that merit further investigation or suspicion? Or are they simply filed away as routine?

Enforcing these rules proves challenging due to the numerous ambiguities involved. Rules should not be excessively stringent, as this could hinder legitimate actions by public officers when purchasing and investing. For example, if a public officer is aware of discussions regarding the possibility of an MRT line in a specific area but lacks knowledge of the exact station location and no station has been publicly announced, can they make an educated guess and purchase a property based on their intuition without violating any laws?

Suppose they possess knowledge of government intentions concerning transportation infrastructure and utilize this information to make the purchase. Is this legitimate, or not?

Another scenario involves an officer already contemplating buying a property and narrowing their options to two. Before committing, they encounter information about a station being planned near one of the properties. Having received this new information, they promptly pay the deposit. Was their timing a mere coincidence, or could it be problematic?

Drawing the line between deterring misuse of confidential information and permitting some legitimate flexibility and discretion is crucial to maintaining an organization's ethos and integrity. This balance must be carefully considered to avoid being too lenient, which could compromise the service or its officers.