Jail for former division head of thumb drive inventor Trek 2000 for cheating, falsifying accounts
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SINGAPORE – With auditors closing in on a fictitious sale, the head of one of the divisions of the company that invented the thumb drive assisted in a conspiracy to cover up the deed.
On Monday, Foo Kok Wah, 55, former president of the operations, sales and customised solutions division of Trek 2000 Group, was sentenced to two months’ jail.
He had pleaded guilty earlier to one charge of instigating another employee to falsify documents and another charge of cheating.
Foo is the fourth person to be sentenced in relation to this case.
Henn Tan, 65, the founder and former chief executive of Trek 2000 International, was sentenced to 16 months’ jail in October 2022.
Former chief financial officer Gurcharan Singh, 66, was sentenced to 11 months’ jai
According to deputy public prosecutors Suhas Malhotra, Ryan Lim and Sivanathan Jheevanesh, sometime between November and December 2015, Tan, Singh and Poo became aware that the group’s financial performance for financial year 2015 would be poor.
The trio, whom Foo reported to, entered into a conspiracy to falsify the group’s financial statements for FY2015 by recording a fictitious sale worth US$3.2 million (S$4.2 million) by Trek Technology (Singapore) to Unimicron.
“The motive was to inflate the group’s reported revenue and net profit for FY2015, and thereby make the group’s financial position appear better than it actually was,” said the prosecutors.
Several actions were committed to effect the recording of this fictitious sale, including the creation of false tax invoices and delivery orders.
In early February 2016, the company auditors, Ernst & Young (EY), queried the sale and asked Trek 2000 to provide supporting documentation and proof of payment.
Though the trio committed several actions to deceive EY into believing the fictitious sale was a genuine transaction, they realised it would be difficult to maintain that Unimicron was the counterparty to the sale.
They decided to change their story and tell EY that Colite Technology Inc, a company incorporated in Taiwan, not Unimicron, was the counterparty to the fictitious sale.
Foo was brought into the plan and tasked to assist in addressing EY’s concerns.
On or around March 11, 2016, he instructed an accounts assistant to create a credit note to reverse the false invoices that Trek Technology (Singapore) had previously created to support the recording of the fictitious sale to Unimicron.
He also instructed another employee to create a tax invoice and corresponding delivery order reflecting that Trek Technology (Singapore) had made the sale to Colite, instead of Unimicron.
On March 21, 2016, EY issued a letter to Trek 2000 International’s board and its audit committee that set out inconsistencies in the supporting documentation for the fictitious sale, and incriminating documents it found in the computers of Poo, Singh and Foo.
After the auditors requested the board to provide a written response to the issues raised, Tan directed Singh, Poo and Foo to create a false chronology setting out the background to the fictitious sale and to provide false documents to support it.
On April 12, 2016, EY issued another letter stating that Trek 2000’s response was unsatisfactory and requested further clarification and information. EY also said it would be notifying the relevant authorities.
EY made a report to the Accounting and Corporate Regulatory Authority on April 20, 2016, which reported the matter to the Commercial Affairs Department of the police.
Before sentencing Foo on Monday, Principal District Judge Victor Yeo Khee Eng said that while Foo was the least culpable of the four co-accused, he could not agree with Foo’s lawyer’s submission for a fine.
Judge Yeo said an offence of this nature is undoubtedly serious, and all four men, who held themselves out as holding key management positions of the group, had no qualms in undermining the statutory audit regime and defrauding the auditors, the company’s stakeholders and investors.
He added: “As rightly submitted by the prosecution, such offences clearly have the potential to affect the integrity of and undermine public confidence in the financial market, and ultimately harm Singapore’s reputation as a leading global investment hub and financial centre.
“Hence, a deterrence sentence is necessary to send a clear message that such offences, if discovered, would be met with a severe sentence to deter like-minded offenders from committing such offences.”
