KUALA LUMPUR (Oct 21): A sub-editor with national news agency Bernama told the High Court on Monday that she stopped receiving returns on her RM50,000 investment in Trillion Cove Holdings Sdn Bhd, one of three companies that was raided by Bank Negara Malaysia (BNM) in November 2021.
Trillion Cove is one of the companies in which Datuk Allan Goh Hwan Hua — founder of MyAirline, the low-cost carrier that collapsed on Oct 12 last year — is a director.
A Prema, 62, said she had invested RM50,000 in Trillion Cove on Nov 16, 2020, at what she called a subscription price.
“After the raid by BNM which was conducted at or around November 2021, all the plaintiffs in this suit had stopped receiving monthly returns or payments from QA Smart Partnership PLT, Trillion Cove and I-Serve Online Mall Sdn Bhd pursuant to Section 44(1) of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLATFPUA) on Nov 11, 2021.
“Subsequently, seizing orders were issued by the Attorney General Chambers against the Goh, I-Serve Online, QA Smart Partnership and Trillion Cove pursuant to Section 50(1) of AMLATFPUA on Jan 28, 2022,” she added.
Prema said on Nov 15, 2021, BNM had released a statement on its website entitled 'Joint Enforcement Action against Companies Suspected to be Involved in Financial Crime Activities' where it is stated that on Nov 11, 2021, a joint enforcement action was taken against I-Serve Online and its related affiliates for suspicion of committing various offences, including under the Financial Services Act 2013 (FSA) and the AMLATFPUA.
She said this followed 22 premises linked to I-Serve Online and its related affiliates located in Kuala Lumpur and Selangor being raided which resulted in the freezing of 45 bank accounts in seven banks and seizing of cash totaling RM118.7 million.
The sub-editor said BNM on Sept 1 last year further released a statement that it had issued compounds on I-Serve Online and six other related entities for breaches of the FSA 2013 and the AMLATFPUA 2021.
“According to the BNM statement, seven entities including i-Serve and QA Smart Partnership were investigated between June 2018 and September 2021 for illegal deposit taking activities,” she replied to questions from lawyers Sonia Mathew, Rajesh Nagarajan and Sachpreetraj Singh Sohanpal and Jusstina Xavier.
Collectively referred to as the 'I-Serve Group', Prema said I-Serve Online and QA Smart Partnership and five other entities were compounded RM50 million on Nov 16, 2022, for accepting deposits without a licence pursuant to Section 137 (1) of the FSA 2013 and money laundering pursuant to Section 4(1) AMLATFPUA.
Goh the man behind the illegal deposit taking
Like the previous witness, Koh Kok Chong, a 64-year-old sales manager who testified on Oct 14, Prema further alleged that Goh is the controlling mind of I-Serve Online, QA Smart Partnership, Trillion Cove and Bright Moon Venture PLT.
Prema further said Goh is a director of Trillion Cove and a shareholder in I-Serve Online.
She added that the four companies in question operated as a single economic unit whereby Goh is the controlling mind of those companies.
The witness contended that there was co-mingling of the investments between the four companies and Goh, and as result of BNM viewing the deposit taking as illegal under Section 137(1), whatever agreement they had with those investment companies would be deemed illegal and void ab initio.
Prema is testifying on behalf of the 15 plaintiffs who had filed a suit against Goh, I-Serve Online, QA Smart Partnership, Bright Moon Venture PLT, in which they sought RM8 million in repayment of their investments.
The plaintiffs said failure to make the payments on the returns was a breach of agreement and they are seeking their full investment amount as well as arrears of the monthly payments.
The plaintiffs also claimed that I-Serve had made undertakings and representations "expressly or by conduct" that it is jointly liable with Bright Moon Venture, QA Smart Partnership and Trillion Cove to make the payouts on behalf of the three companies.
Goh and the company in their defence claimed the plaintiffs could not file the legal action as the sum demanded were part of the monies seized by BNM under AMLATFPUA.
Goh further claimed that he should not be made a party in the dispute and the legal action was unsustainable as they were “vague, imprecise and lacking in material particulars”.
One of the companies, namely Trillion Cove, is now placed under the Insolvency Department following winding-up proceedings.
Witness does not agree compound is not admission of guilt
When cross-examined by Tina Francis for Goh, Prema agreed the BNM statement did not involve her investments made in Trillion Cove and following the raid by the authorities, she did not make any additional investments.
Prema said while she agreed there were three webinars organized between November and December 2021 to brief investors about the raid, she disagreed that investors were informed of the settlement with BNM over the compound payment as she claimed the sum or compound was not discussed.
She also disagreed with the notion that the compound of RM50 million imposed for illegal deposit taking was “not an admission of guilt” and described such notion as baseless and unsubstantiated.
Replying to questions from lawyer V Varunnath for QA Smart Partnership and Bright Moon Venture, Prema agreed there was no action by her against the two companies but said there was co-mingling of funds.
Replying to questions from counsel Chethan Jethwani for I-Serve Online, Prema denied that her investments constituted deposits.
Chethan further argued that while Prema and other plaintiffs are seeking to declare the contract void and a return of their invested sum, Section 270 of FSA stipulates the contract cannot be declared void because of the companies’ contravention on not having a licence to collect deposits, to which the witness disagreed.
She maintained that Goh had represented all companies and he should be held liable as with other companies.
The hearing before Judicial Commissioner Leong Wai Hong continues on Tuesday.