Various companies under CoAssets, a financial firm accused of misconduct by its clients, are being investigated for possible offences under the Penal Code and the Securities and Futures Act.
In a statement issued yesterday, the Singapore Police Force's Commercial Affairs Department (CAD) and the Monetary Authority of Singapore (MAS) said the joint investigation, launched on Jan 12, stems from complaints and feedback received from members of the public regarding suspected misconduct by CoAssets Group companies.
Hundreds of CoAssets' retail investors were left reeling in early December amid media reports that the Singapore-based alternative lending platform had transferred US$30 million (S$39.9 million) of its borrowings to a little-known debt recovery firm, Sunfits.
Aggrieved investors filed police reports against CoAssets' co-founders Getty Goh and Seh Huan Kiat, and grouped together on messaging platforms such as Telegram to pursue legal action.
MAS said last month that it will review and take necessary action if CoAssets' licensed subsidiary - CA Funding - had breached regulations. Of the CoAssets Group companies, only CA Funding is regulated by MAS, as a capital markets services licensee.
In March last year, MAS issued a direction to CA Funding to prohibit the company from listing new issuances, signing up new investors and accepting subscription of securities.
These directions were issued after MAS' inspection uncovered lapses in CA Funding's credit assessment process, an inadequate disclosure of information to investors, and a failure to address conflicts of interest arising from dealings that the CoAssets Group companies had with entities related to issuers that CA Funding had listed on its platform.
MAS had also directed CA Funding to appoint an independent external auditor to review the effectiveness of its remedial measures to address these deficiencies.
According to the statement, CA Funding informed MAS in December that it had failed to comply with the minimum base capital requirement under the Securities and Futures Act and intended to cease operations.
As directed by MAS, all customers' monies held by CA Funding have since been returned to investors, yesterday's joint statement said.
MAS is closely monitoring CA Funding's implementation of its cessation plan to ensure that investors are treated fairly, the statement added.