The Singapore Exchange (SGX) has reprimanded Catalist-listed Oriental Group, as well as eight connected individuals - a current director, six past directors including its former chairman and chief executive officer, and a former group financial controller - for misconduct in relation to three fund-raising activities and unauthorised transactions.
The reprimand follows several breaches of listing rules by the company and the individuals, including misleading and inaccurate announcements on the fund-raising exercises, unauthorised corporate guarantees extended in favour of interested persons and/or unauthorised interested person transactions, said SGX in a statement last Friday.
As a result, too, Singapore-listed companies will need to get the Singapore Exchange Regulation's (SGX RegCo) nod before any of these individuals can be appointed as a director or to the management team.
Those who earned the rebuke of the regulator included the troubled firm's former non-executive chairman Wu Dingrong, former executive director and former CEO Lee Wan Sing, former executive director Sun Lu, former non-executive director Richard Ong Wee Chuan, and former independent directors Tan Song Kwang and Koh Choon Kong.
Oriental's present independent director Chua Hung Meng and former group financial controller Lee Ong have also been admonished for breaching Catalist rules.
By way of background, the regulator said the company appointed a special auditor and an independent reviewer to review these "irregularities" that took place in Singapore and China. Details of the review were disclosed in an announcement back in early December last year.
The listing rule breaches relate to several transactions undertaken by the steel trader and manufacturer that were announced between 2012 and 2015, including two share placement exercises, an issue of convertible loan notes, unauthorised corporate guarantees and interested person transaction as well as backdating of invoices for the purchase of IT equipment.
For instance, in a share placement exercise announced in 2012 that was placed out to 32 subscribers to raise some $21.5 million, the company, as authorised by Mr Lee Ong, had announced that the exercise was completed in April 2013 when in fact the full sum was received by the firm only three years later, said SGX in the statement.
In another $5 million share placement deal to eight subscribers announced in July 2015, the company said it was completed in August of the same year even though, as discovered by the special audit, there was still an outstanding sum from one subscriber that was concealed under a "ruse" involving a transfer of shares. It was revealed by the audit that Mr Lee Ong had assisted Mr Lee Wan Sing with the share transfers.
In the light of the 2013 internal audit findings, the regulator said the company's board and audit committee had failed to take the necessary steps to ensure adequacy of the group's internal controls.
SGX RegCo has also referred the breaches to the appropriate authorities.
Oriental Group is currently under judicial management and the counter has been suspended since March 2016.
Two weeks ago, it sought to extend the deadline for the second time from SGX to submit a proposal for trading resumption. It received the regulator's nod and now has until July 26, from the previous June 15 deadline, to do so.