THE latest clarification by Perak-based lingerie manufacturer Caely Holdings Bhd that the current freeze on its bank accounts by the Malaysian Anti-Corruption Commission (MACC) is the doing of one of its previous board members is a big lesson to listed entities that are engaged in boardroom tussle.
While discontentment between the two warring factions may be unbearable, both rivals must strive to ensure that sanity should prevail by not allowing unfounded suspicion to get the better of them.
As in Caely’s case, a simple report to the graft buster is all it takes for the company’s bank accounts to be frozen, the result of which has inflicted so much hardship with regard to payment of staff salaries and money owing to its vendors for the past two months.
In allaying misconception that the freezing of its bank accounts is not related to any misconduct of the company’s new board, Caely said is currently working closely with the authorities to unfreeze the said accounts.
“The company and the new board of directors have taken up the reign and to their best endeavour assist MACC with its investigation to clear all queries and/or doubts towards the company and/or its previous board of directors,” Caely pointed out in a media statement.
On its part, the company said it has also lodged a police report and will further escalate to Bursa Malaysia Securities Bhd and the Securities Commission (SC) for further investigation.
As revealed by Caely chairman Datuk Loh Ming Choon, the MACC report was lodged by the group’s founder Datin Fong Nyok Yoon over the wrongdoings by a former director which subsequently led to the freezing order by the MACC.
Whether Fong, 62, who is also Caely’s non-independent and non-executive director was aware of the consequence of her action prior to her lodging of the report or has even regretted her action is a tad too late now given the company has been ‘financially strapped’ – literally – following the freeze on its bank accounts.
As shared by Loh, the group has been facing insufficient cash flow since then as several directors and shareholders chipped in with interest-free loans to pay staff and suppliers.
“The loans from the directors and shareholders are based on the current needs of the day-to-day operations and they will be reimbursed the money accordingly,” he told a media briefing yesterday (June 16). “The first package given by the directors and shareholders was about RM600,000 to RM700,000 to cover the salaries of factory workers and other staff.’
On a bigger picture, the bank account freeze is only one of the ‘turbulences’ faced by Caely in recent times. The company’s board has reiterated that the extraordinary general meeting (EGM) held on June 15 to remove nine directors from the existing board is invalid.
Towards this end, the company’s board has lodged a police report yesterday (June 16) against the three requisitionists – namely, Leong Seng Hui, Kok Kwang Lim and Valhalla Capital Sdn Bhd – given the move to proceed with the EGM was sub judice and akin to contempt of court.
This means that it is status quo for the existing board which saw two new board members in executive vice chairman Datuk Jovian Mandagie, 36, and independent non-executive director Sandraruben Neelamagham, 35, whose appointments took effect on Tuesday (June 14). Jovian is the son-in-law of Prime Minister Datuk Seri Ismail Sabri Yaakob.
More recently, the company’s forensic auditor Virdos Lima Consultancy (M) Sdn Bhd said its investigation into allegations of suspicious and irregular transactions within the company has stalled following the unavailability of key information.
At 10.47am, Caely was up 1 sen or 2.56% to 40 sen with 27,400 shares traded, thus valuing the company at RM103 mil. – June 17, 2022
