Saturday 22 Jun 2024
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KUALA LUMPUR (March 29): Three China-based companies, namely China Stationery Ltd, Xingquan International Sports Holdings Ltd and Maxwell International Holdings Bhd, have been found furnishing false or misleading financial statements to Bursa Malaysia.

This, according to the Securities Commission Malaysia (SC), were among securities law breaches the three companies committed, for which they have been rapped by the SC.

In the case of CSL, SC said it also reprimanded its executive chairman and CEO Chan Fung @ Kwan Wing Yin, former executive director Angus Kwan Chun Jut and former independent non-executive director Herman Widjaja for committing the above offence.

Chan was further reprimanded for causing two of CSL's wholly-owned subsidiaries to be a guarantor for his personal loans, "with the intention of causing wrongful loss to the said subsidiaries".

Chan and Angus were also reprimanded for failing to respond to the SC when served with written notices requesting for information.

Xingquan, meanwhile, was reprimanded together with its executive chairman and CEO Datuk Wu Qingquan, executive director Wu Lianfa, former non-independent non-executive director Ng Sio Peng and former senior independent non-executive director Zhou Li Yi.

Besides furnishing false or misleading financial statements to Bursa, the reprimand was also for falsely recording a loss of renminbi 415.7 million from the sale of inventory by Xingquan's wholly-owned subsidiary, furnishing a false agreement to Bursa between the said subsidiary and a third party, and recording cash and bank balances in eight bank accounts collectively belonging to Xingquan that were false or misleading.

Qingquan and Lianfa were also rapped for failing to respond to the SC when the regulator sought more information.

In the case of Maxwell, it was reprimanded together with its president and executive director at the material time, Li Kwai Chun, and independent non-executive director Su DeMou, and former chief financial officer Tan Swee Song for recording in Maxwell's financial statements a payment of renminbi 45.6 million by Maxwell's wholly-owned subsidiary, which was a false or misleading information.

Li, Su and Tan, together with Maxwell and its former CEO and executive director Xie Zhenan, were also reprimanded by the SC for furnishing false or misleading financial statements to Bursa.

The SC is also of the opinion that the retention of office by four of the directors in the three companies are prejudicial to public interest. The four directors are: CSL's Chan as executive chairman and CEO, Xingquan's Qingquan as executive chairman and CEO, Xingquan's Lianfa as executive director, and Maxwell's Li as non-independent, non-executive director.

"In making this public statement under section 354(3)(f)(ii) of the Capital Markets and Services Act 2007 (CMSA) against the four directors, the SC took into consideration, among others, the seriousness of the breaches committed by these individuals," the SC said.

SC said that the companies are given a period of 30 days from the date the sanctions are meted out to make their appeal.

It also noted that Bursa Malaysia had suspended the trading of Maxwell on May 10, 2018, Xingquan on June 8, 2017, and CSL on Dec 5, 2018.

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