SC sues Stone Master deputy MD for wrongful loss
PETALING JAYA: Securities Commission Malaysia (SC) has filed a suit against Stone Master Corp Bhd deputy managing director Datin Chan Chui Mei for allegedly causing wrongful loss to the company.
The claim revolves around Stone Master's agency agreement with 23 foreign companies for exclusive rights to market and promote, in Malaysia and Singapore, products belonging to the foreign companies. Stone Master paid several local representatives of the 23 foreign companies a sum amounting to RM11.59 million in the form of a nonrefundable deposit. The SC alleged of the RM11.59 million, a sum of RM11.54 million was subsequently paid by the local representatives to Chan’s personal account, in breach of sections 179 and 317A(1) of the Capital Markets and Services Act 2007 (CMSA).
Section 179 prohibits a person from using any manipulative device for the subscription, purchase or sale of any securities, while under Section 317A, a director or an officer of a listed corporation shall not do anything with the intention of causing wrongful loss to the listed corporation.
The SC had, on Sept 28, 2016, obtained an injunction from the Kuala Lumpur High Court to restrain Chan from dealing with the RM11.54 million in her bank accounts. In granting the injunction, the High Court also ordered her to provide a detailed account of the RM11.54 million, which she had received.
In the suit, the SC is seeking various orders, including an order that Chan, contravened Sections 179 and 317A of the CMSA; makes restitution to persons aggrieved by the contravention; pays the SC the said sum of RM11.54 million to be held in trust for Stone Master and be barred from being a director of a public-listed company for a period of five years.
The SC is also seeking to impose a civil penalty of RM1 million against Chan. The High Court has fixed Oct 14, 2016 for her to respond to the injunction application.