SINGAPORE - As the former chief executive of beverage company Pokka International, Ong Eng Sing had to declare his partial ownership of a drinks company when the two companies entered into a transaction.
But he did not, and on Monday (Aug 22), the 47-year-old Singaporean was fined $15,000 after pleading guilty to three charges under the Companies Act.
Ong, who is also known as Alain, was also disqualified from acting as a director or taking part in the management of a company for two years.
It was previously reported that Ong, whose wife, actress Vivian Lai, used to appear in Pokka advertisements, was asked to leave Pokka International, which is wholly owned by Pokka Corporation (Singapore), in September 2018.
Between 2010 and 2017, he held various positions in the two Pokka entities, including director of both entities, while beneficially owning 40 per cent of shares in drinks company Asian Story Corporation (ASC).
ASC was incorporated on Dec 15, 2009, and its shares were 100 per cent legally owned by a man named Mr Amos Wang Chia Ye.
Ong did not wish to legally own ASC shares in his own name as he was an employee of Pokka when ASC was incorporated, and he did not take any dividends from ASC, Deputy Public Prosecutor David Koh told the court on Monday.
The two Pokka entities entered into three agreements with ASC - a distribution agreement in 2010 and a distribution framework in 2017 with Pokka International, and a manufacturing agreement in 2016 with Pokka Corp.
On all three occasions, Ong did not disclose his interest in these transactions to Pokka International or Pokka Corp.
ASC was acquired by coffee shop operator Kimly for $24 million on July 2, 2018, and a cashier’s order for $9.6 million was issued to Ong by Mr Wang.
Ong was placed on garden leave from Pokka Corp on Sept 19, 2018, following internal investigations.
The following month, the firm’s group chief executive officer made a police report and on Nov 29, 2018, Kimly announced that it had received a notification from Pokka Corp of its intention to terminate its manufacturing agreement with ASC.
Kimly then agreed with Mr Wang and ASC to rescind Kimly’s acquisition of ASC and the full sum received by Mr Wang for the acquisition was returned to Kimly between Jan 8, 2019, and Dec 30, 2020.
Ong had returned $9 million to Mr Wang on Nov 5, 2018, and the remaining $600,000 in January 2019.
In July 2019, Pokka filed a civil suit against Ong, which was settled.
Ong was represented by Mr Timothy Tan and Ms Tara Heng from Trident Law Corporation and in mitigating for their client, they said he was remorseful and regrets having failed to disclose his interest in ASC.
They added that in 2009, Ong was concerned by Pokka losing its market share and that it had gained from the three agreements made with ASC.
They said: “Be it gaining market share, warding off a competitor or expanding Pokka’s capabilities, Pokka had benefited from (the agreements).”
For each offence under the Companies Act, Ong could have been jailed for up to 12 months or fined up to $5,000.