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Founder of Trek 2000, firm that invented thumbdrive, fined S$80,000 for not disclosing S$14 million of transactions

Founder of Trek 2000, firm that invented thumbdrive, fined S$80,000 for not disclosing S$14 million of transactions

Henry Tan, also known as Henn Tan, pleaded guilty in a district court to two charges under the Securities and Futures Act. (Photo: TODAY/Nuria Ling)

SINGAPORE: A man who founded mainboard-listed tech company Trek 2000 International, the firm behind the invention of the thumbdrive, was fined S$80,000 on Monday (Aug 24) for failing to disclose US$10.5 million (S$14.4 million) worth of transactions.

These transactions were between the Trek 2000 group and another firm Tan was the sole shareholder for, as well as a firm his son held majority shares in.

Henry Tan, 63, also known as Henn Tan, pleaded guilty to two charges under the Securities and Futures Act, with four other charges taken into consideration.

The well-known figure in Singapore's tech innovation scene faces several other pending charges, mostly for falsification of accounts relating to Trek 2000's financial statements.

The court heard that Tan was the chairman and chief executive officer of Trek 2000 and was an executive director as well as its largest shareholder.

Trek 2000 was incorporated as a private limited company in 1999 and converted into a public company the following year before listing on the Stock Exchange of Singapore Dealing and Automated Quotation System, and being transferred to the main board of the Singapore Exchange Securities Trading Limited in 2002.

Trek 2000 was an investment holding company with a portfolio of technology-related intellectual properties, including the thumbdrive or USB flash drive, which it invented in or around 2000.

Under the Securities and Futures Act, the firm was required to disclose certain transactions by interested persons. The company was required to immediately announce the latest transaction and all future transactions it entered into with an interested person during a financial year if the aggregate value of such transactions amounted to 3 per cent or more of the group's latest audited net tangible assets.

Tan's son, Wayne Tan Joon Yong, held 80 per cent of the shares in T-Data Systems, between September 2012 and March 2014. 

The net tangible assets for Trek 2000 and its subsidiaries for the financial year ending Dec 31, 2012 was US$35.1 million (S$48.2 million) and 3 per cent of this was US$1.05 million.

Trek 2000 and its subsidiaries entered into various transactions with T-Data between January 2013 and February 2013, with a value exceeding US$1.05 million after a sale of more than 208,000 pieces of wafer components to T-Data.

Trek 2000 was required to make an immediate announcement of this transaction and every subsequent transaction with T-Data of S$100,000 and above in the financial year, but failed to do so.

In total, Tan's company and its subsidiaries entered into US$12.3 million worth of transactions of wafer, USB and other components with T-Data in the financial year of 2013.


Investigations showed that Tan knew that his son held shares in T-Data, and had in fact arranged for T-Data to be incorporated in 2007 with the wife of co-accused Poo Teng Pin, an executive director of Trek 2000 and the research and development director of the firm and its subsidiaries.

Tan instructed Poo's wife to transfer 80 per cent of T-Data's shares to Wayne and this was done in September 2012.

Tan also attended meetings where the topic of interested person transactions was discussed, but did not reveal his son's shareholding in T-Data.

Tan incorporated another firm, S-Com Solutions (Hong Kong) Co Limited, in October 2005 and was its sole shareholder.

Trek 2000 and its subsidiaries entered into various transactions with S-Com HK in 2010, with a value exceeding US$1,1149,119 or the threshold of 3 per cent of the group's audited net tangible assets.

In total, there were six transactions made with a total value of US$882,256 between the group and S-Com HK in the financial year of 2010. 

However, Tan did not disclose these transactions to the group. The offences were discovered during investigations by the Commercial Affairs Department into separate offences committed by the management of T2000.

Poo was fined S$20,000 in June for his role in the offences.


Deputy Public Prosecutor Tan Ee Kuan asked for a fine of at least S$90,000, saying that Tan was more culpable than his co-accused Poo as he attended meetings where the issue of whether Trek 2000 had entered into any interested person transactions was raised and discussed.

He also saw statements where the phrase "no IPTs for the period under review" was included in meeting minutes and circulated to him, but did not disclose his son's shareholding.

Defence lawyer Daniel Cai of Drew & Napier asked instead for a fine of S$40,000, saying that his client's charges were "under the least culpable limbs" of the act.

He said Tan should receive "identical sentences" as his co-accused Poo because they were both senior executives.

He added that Tan had entered a "timely plea of guilt" and did not have any personal gain from the transactions, which had been entered into "for the company's benefit".

Tan had also taken steps to immediately remedy procedures afterwards and has no prior convictions.

The judge agreed with prosecutors that Tan could be sentenced on a scale higher than that for Poo, noting that he faces more charges and has a higher degree of culpability.

Tan will return to court next month for other charges, mostly for falsification of accounts by making false entries in the company's financial statements.

He could have been jailed for up to seven years, fined up to S$250,000 or both for each charge of failing to disclose transactions by interested persons under the Securities and Futures Act.

Source: CNA/ll(hs)


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