Two former directors of Kimly, former Pokka International CEO charged with disclosure offences

SINGAPORE – Two former directors of Kimly were charged on Friday (Nov 12) with disclosure offences related to the listed coffee shop operator’s acquisition of drinks manufacturer Asian Story Corporation (ASC) in 2018.

On Friday, the police said the former head of Pokka International was also charged with disclosure offences linked to the same manufacturer.

Kimly’s former executive chairman Lim Hee Liat and former executive director Chia Cher Khiang were charged under the Securities and Futures Act in connection with the acquisition of ASC which was announced on July 2, 2018.

In November 2018, it was reported that Kimly was backing out of its $16 million acquisition, following an investigation by the authorities. Kimly and ASC received letters from the Commercial Affairs Department and the Monetary Authority of Singapore, requesting for documents.

The police said on Friday (Nov 12) that Kimly’s acquisition was allegedly an interested person transaction, given Lim’s partial beneficial ownership of ASC.

This meant that the transaction should have been disclosed under the Singapore Exchange Catalist Rules, but purportedly was not.

Lim was also charged with one count under the Companies Act for allegedly failing to disclose his interest in the acquisition of ASC to Kimly.

In a regulatory update on Thursday (Nov 11), Kimly, which also runs food courts, said Chia and Lim had notified the board of their resignations.

Kimly’s board has requested the two to remain as employees to assist and facilitate the board and management in the transition, pending the conclusion of court proceedings, the group said.

The former chief executive of Pokka International Alain Ong Eng Sing faces three charges under the Companies Act.

Ong, who was also a director in Pokka International and Pokka Corporation (Singapore), allegedly had partial beneficial ownership of ASC, and failed to disclose his interest to the two Pokka entities on three occasions when they and ASC entered into transactions.

In September 2018, it was reported that Kimly hired Ong after he was asked to leave Pokka International. While he was the CEO there, his wife, actress Vivian Lai, was a long-time celebrity endorser of the Pokka brand.

In a clarification statement to the SGX on Sept 30, 2018, Kimly neither confirmed nor denied the appointment of Mr Ong.

If convicted for offences under the Securities and Futures Act, they can be jailed up to seven years, fined up to $250,000, or both.

If convicted for offences under the Companies Act, they can be jailed up to 12 months or fined up to $5,000.