Ex-finance staff on stand as Airocean trial resumes
By Lee Su Shyan 28 January 2010
A closely watched trial that addresses the extent of the liability of independent directors of listed companies has resumed in the Subordinate Courts.
Former finance staff at Airocean have taken the stand in the trial in which three directors of the company have been charged with making a ‘misleading’ public statement in 2005.
Two former independent directors - Ong Seow Yong and Peter Madhavan - and former chief operating officer Johnson Chong have been charged with making a misleading public statement in November 2005.
The statement was made to the Singapore Exchange as the company responded to a Straits Times report that then-CEO Thomas Tay was under a Corrupt Practices Investigation Bureau (CPIB) probe.
The board said that the CPIB investigation in September 2005 was related to practices ‘in some other companies in the air cargo industry’.
The prosecution’s case was that this was a misleading statement likely to stabilise the company’s share price.
The case has attracted attention of corporate-watchers keen to learn the extent of the liability of independent directors and the scope of their duties.
Former finance director Doris Koh and former finance manager Ang Lay Hua have been on the stand over the past three days.
Under questioning by Mr. Madhavan’s lawyer Wendell Wong of Drew and Napier, the two have said that up to the date of the release of the announcement, they were of the view that the CPIB investigation did not involve Airocean and its subsidiaries.
The defence has been advancing the argument that the Nov 25 statement was not misleading.
Tay has been found guilty of attempted bribery. He had also admitted to failing to notify SGX of his involvement with the investigation and to having given false information about it to The Straits Times which had a material impact on Airocean’s share price.
The other Airocean independent director Ong Chow Hong pleaded guilty last year to the charge of failing to use reasonable diligence in the discharge of his duties as a director of Airocean.
This is not the first time that an independent director has been charged with breaches of the Securities and Futures Act, but it marks the first time that an independent director has gone on trial.
In 2008, four former Chuan Soon Huat directors, including an independent director, pleaded guilty to failing to disclose that executive chairman Lee Tian Teck, who had suffered two strokes, was no longer discharging his duties.
The Airocean trial continues before District Judge Liew Thiam Leng.
Ex-finance staff on stand as Airocean trial resumes
ReplyDeleteBy Lee Su Shyan
28 January 2010
A closely watched trial that addresses the extent of the liability of independent directors of listed companies has resumed in the Subordinate Courts.
Former finance staff at Airocean have taken the stand in the trial in which three directors of the company have been charged with making a ‘misleading’ public statement in 2005.
Two former independent directors - Ong Seow Yong and Peter Madhavan - and former chief operating officer Johnson Chong have been charged with making a misleading public statement in November 2005.
The statement was made to the Singapore Exchange as the company responded to a Straits Times report that then-CEO Thomas Tay was under a Corrupt Practices Investigation Bureau (CPIB) probe.
The board said that the CPIB investigation in September 2005 was related to practices ‘in some other companies in the air cargo industry’.
The prosecution’s case was that this was a misleading statement likely to stabilise the company’s share price.
The case has attracted attention of corporate-watchers keen to learn the extent of the liability of independent directors and the scope of their duties.
Former finance director Doris Koh and former finance manager Ang Lay Hua have been on the stand over the past three days.
Under questioning by Mr. Madhavan’s lawyer Wendell Wong of Drew and Napier, the two have said that up to the date of the release of the announcement, they were of the view that the CPIB investigation did not involve Airocean and its subsidiaries.
The defence has been advancing the argument that the Nov 25 statement was not misleading.
Tay has been found guilty of attempted bribery. He had also admitted to failing to notify SGX of his involvement with the investigation and to having given false information about it to The Straits Times which had a material impact on Airocean’s share price.
The other Airocean independent director Ong Chow Hong pleaded guilty last year to the charge of failing to use reasonable diligence in the discharge of his duties as a director of Airocean.
This is not the first time that an independent director has been charged with breaches of the Securities and Futures Act, but it marks the first time that an independent director has gone on trial.
In 2008, four former Chuan Soon Huat directors, including an independent director, pleaded guilty to failing to disclose that executive chairman Lee Tian Teck, who had suffered two strokes, was no longer discharging his duties.
The Airocean trial continues before District Judge Liew Thiam Leng.