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Friday, 18 September 2009
Three former senior execs of Daka Designs charged in Hong Kong
Three ex-senior executives of a former Singapore- listed company, Daka Designs, have been charged in Hong Kong with conspiring to defraud shareholders and the Singapore Exchange between early 2003 and May 2005.
Three former senior execs of Daka Designs charged in Hong Kong
The trio is alleged to have ‘dishonestly falsified’ financial records
By JAMIE LEE 16 September 2009
Three ex-senior executives of a former Singapore- listed company, Daka Designs, have been charged in Hong Kong with conspiring to defraud shareholders and the Singapore Exchange between early 2003 and May 2005.
They were charged on Monday by Hong Kong’s Independent Commission Against Corruption (ICAC).
The trio - ex-CEO Raymond Chow, former executive chairman Mah Pat Y and ex-CFO Kevin Leung - was alleged to have ‘dishonestly falsified’ financial records such as goods receipt acknowledgements and delivery notes of its subsidiary Briga Group (Macao Commercial Offshore) Company Ltd.
They allegedly inflated the turnover and profit figures by over HK$8.9 million (S$1.63 million), ICAC said in a press release.
These inflated numbers were in ‘dishonestly compiled and published documents’ such as the annual report for the financial year ended March 31, 2004, ICAC added.
‘It is alleged that the defendants had misled existing and potential shareholders of Daka Designs and SGX as to the true financial position of the company, and prevented SGX from taking any action against the company for its failure,’ said ICAC.
The trio had allegedly conspired with another person who was not named in the statement.
Ex-CEO Chow and former executive chairman Mah also face a joint charge of dishonestly transferring 32 per cent of the shares of another unit, Daka Industrial Ltd, to a person unidentified in the press release. The duo had allegedly misrepresented the financial position of Daka Designs and the subsidiary in the company’s prospectus dated July 2, 2004.
‘As a result, the duo allegedly induced SGX to approve the application of Daka Designs for listing in Singapore,’ said ICAC.
Chow faces another six charges for conspiring with ‘other persons’ to defraud six banks in Hong Kong of loans totalling over HK$7.5 million.
The three men, who were arrested by ICAC in October 2007, will appear in court today. They have been released on bail.
SGX told BT that it kept an active cooperation with ICAC and Singapore’s Corrupt Practices Investigation Bureau (CPIB) in relation to the investigations.
‘We note that the investigation has resulted in tangible progress culminating in the former senior executives of Daka Designs being brought before the Hong Kong courts,’ said an SGX spokesman.
‘We continue to monitor developments with interest as the case progresses through the Hong Kong judicial framework.’
It added that it would continue to explore all avenues for enforcement of its rules and the bye-law, or a locally applied law.
Hong Kong-based Daka was riddled with problems in the four years that it was listed on SGX.
In late 2005, SGX called for a special audit on Daka following two profit warnings from the company.
When Daka blocked access to its records, SGX slapped a trading halt in January 2006 and subsequently hardened that into a trading suspension after the auditor KPMG found serious irregularities in Daka’s finances. The suspension was never lifted.
The issue was then turned over to the Commercial Affairs Department.
In 2007, Daka sold its entire business to its parent Daka Direct and, as a listed shell company, tried to engineer a couple of reverse takeovers that failed.
Daka, which was renamed Carats in 2007, was eventually delisted a year later as SGX denied an extension of the deadline for it to secure a new business.
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Three former senior execs of Daka Designs charged in Hong Kong
The trio is alleged to have ‘dishonestly falsified’ financial records
By JAMIE LEE
16 September 2009
Three ex-senior executives of a former Singapore- listed company, Daka Designs, have been charged in Hong Kong with conspiring to defraud shareholders and the Singapore Exchange between early 2003 and May 2005.
They were charged on Monday by Hong Kong’s Independent Commission Against Corruption (ICAC).
The trio - ex-CEO Raymond Chow, former executive chairman Mah Pat Y and ex-CFO Kevin Leung - was alleged to have ‘dishonestly falsified’ financial records such as goods receipt acknowledgements and delivery notes of its subsidiary Briga Group (Macao Commercial Offshore) Company Ltd.
They allegedly inflated the turnover and profit figures by over HK$8.9 million (S$1.63 million), ICAC said in a press release.
These inflated numbers were in ‘dishonestly compiled and published documents’ such as the annual report for the financial year ended March 31, 2004, ICAC added.
‘It is alleged that the defendants had misled existing and potential shareholders of Daka Designs and SGX as to the true financial position of the company, and prevented SGX from taking any action against the company for its failure,’ said ICAC.
The trio had allegedly conspired with another person who was not named in the statement.
Ex-CEO Chow and former executive chairman Mah also face a joint charge of dishonestly transferring 32 per cent of the shares of another unit, Daka Industrial Ltd, to a person unidentified in the press release. The duo had allegedly misrepresented the financial position of Daka Designs and the subsidiary in the company’s prospectus dated July 2, 2004.
‘As a result, the duo allegedly induced SGX to approve the application of Daka Designs for listing in Singapore,’ said ICAC.
Chow faces another six charges for conspiring with ‘other persons’ to defraud six banks in Hong Kong of loans totalling over HK$7.5 million.
The three men, who were arrested by ICAC in October 2007, will appear in court today. They have been released on bail.
SGX told BT that it kept an active cooperation with ICAC and Singapore’s Corrupt Practices Investigation Bureau (CPIB) in relation to the investigations.
‘We note that the investigation has resulted in tangible progress culminating in the former senior executives of Daka Designs being brought before the Hong Kong courts,’ said an SGX spokesman.
‘We continue to monitor developments with interest as the case progresses through the Hong Kong judicial framework.’
It added that it would continue to explore all avenues for enforcement of its rules and the bye-law, or a locally applied law.
Hong Kong-based Daka was riddled with problems in the four years that it was listed on SGX.
In late 2005, SGX called for a special audit on Daka following two profit warnings from the company.
When Daka blocked access to its records, SGX slapped a trading halt in January 2006 and subsequently hardened that into a trading suspension after the auditor KPMG found serious irregularities in Daka’s finances. The suspension was never lifted.
The issue was then turned over to the Commercial Affairs Department.
In 2007, Daka sold its entire business to its parent Daka Direct and, as a listed shell company, tried to engineer a couple of reverse takeovers that failed.
Daka, which was renamed Carats in 2007, was eventually delisted a year later as SGX denied an extension of the deadline for it to secure a new business.
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