Former Hyflux CEO Olivia Lum faces more charges over failings related to financial statements
SINGAPORE: Former Hyflux chief executive officer Olivia Lum Ooi Lin was on Friday (May 5) charged with additional offences for failing in her duties as a director with respect to the firm's financial statements.
The charges relate to her approval of financial statements between 2017 and 2018, where bank deposits were not disclosed as restricted bank balances.
Lum was also charged in November last year for disclosure-related offences related to the Tuaspring project as well as failing to ensure Hyflux’s compliance with accounting standards.
Investigations into the water treatment firm were launched in June 2020 by the authorities - the Singapore Police Force (SPF), the Monetary Authority of Singapore (MAS) and the Accounting and Corporate Regulatory Authority (ACRA) - in the wake of a debt restructuring saga that left tens of thousands of retail investors frustrated.
The once-iconic Singapore business finally wound up in July 2021.
On Friday, three charges were levelled at Lum for failing to exercise reasonable diligence in the discharge of her duties as a director. She had approved the release of financial statements where bank deposits - which Hyflux had undertaken not to withdraw from - were not disclosed as restricted bank balances.
One count related to Hyflux’s unaudited financial statements for the third quarter and nine months ended Sep 30, 2017. The amount involved was US$33.5 million, or about S$45.6 million at the prevailing exchange rate on Nov 9, 2017.
Another count was linked to the company’s unaudited financial statements for the financial year ended Dec 31, 2017. This also involved US$33.5 million, or about S$44.1 million at the prevailing exchange rate on Feb 27, 2018.
The third count was with respect to Hyflux’s unaudited first quarter financial statements for the period ended Mar 31, 2018. The amount here was US$47.5 million, or about S$63.7 million at the prevailing exchange rate on May 9, 2018.
For each of these charges, Lum could get up to a year in jail or be fined up to S$5,000.
An independent director of Hyflux, Lee Joo Hai, was also charged under the Securities and Futures Act on Mar 13.
“The charge relates to his negligence in connection with Hyflux’s intentional failure to disclose information relating to the Tuaspring Integrated Water and Power Project when such disclosure was required under the Singapore Exchange listing rules,” SPF, MAS and ACRA said.
Lee, who left Singapore before investigations started, was arrested in Malaysia on Mar 12, with the assistance of the Royal Malaysia Police.
If convicted, Lee could face up to seven years in jail, a fine of up to S$250,000 or both.
SPF, MAS and ACRA also said on Friday that the Public Accountants Oversight Committee has issued orders against Hyflux's auditors KPMG, in relation to "relevant financial statements for the financial years ended between 2013 and 2017".
"We are unable to share any further information due to ongoing civil proceedings related to this matter," the agencies added.
Editor's note: An earlier version of this article referred to bank deposits omitted in financial statements. That is incorrect. The bank deposits, which Hyflux had undertaken not to withdraw from, were not disclosed as restricted bank balances. We are sorry for the error.