TECHNOLOGY provider Trek 2000 maintains that it is uninvolved in legal charges against the company&rsquo s founder as well as former chairman emeritus and chief executive Henn Tan, as the matter is &ldquo in his personal capacity&rdquo .

 

Responding to an Aug 15 article from The Business Times, the group said there was no financial impact to the company from these charges - and that the financial position of the company &ldquo continues to be healthy&rdquo .

 

Based on Trek&rsquo s financial statements for the first half of the fiscal year ended June 2022, the group sank into a net loss of US$6.4 million from its earnings of US$504,000 the previous year.

 

Revenue fell 64.2 per cent to US$7.4 million from US$20.7 million in H2 FY2021, which the group attributed mainly to the Covid-19 lockdown in China - its main market - along with volatility in foreign exchange rates.

 

Gross profit margin for the half year decreased to 4 per cent from 7.5 per cent, due to lower sales demand faced in the global market.

 

In a bourse filing on Tuesday (Aug 23), Trek said it remains unaware of any financial misappropriation from the charges faced by Tan, who earlier this month pleaded guilty to 5 charges of engaging in conspiracies to falsify accounts, forge documents to cover his tracks as well as cheat the external auditors.

 

The company highlighted that its board has &ldquo taken decisive steps to identify the lapses in internal controls and governance systems&rdquo since the charges first came to light in 2016.

 

&ldquo After thorough reviews by independent CPA (certified public accounting) firms were concluded up to 2019, the board of directors and the company&rsquo s new executives worked diligently to implement all the recommendations made and strengthen the internal control and governance systems of the company,&rdquo it said.

 

Adding that a new management team has been in place since early 2018, Trek emphasised that its former management staff who were charged are no longer involved in the day-to-day operations of the company.

 

Tan stepped down from his role as chief executive following objections by the Singapore Exchange in 2018, but remained as chairman emeritus until 2020.

 

Trek&rsquo s management team is now helmed by his son and the group&rsquo s deputy chairman, Wayne, who is said by the company to have &ldquo worked diligently to ensure continuity to business operations&rdquo .

THE Singapore Exchange Regulation (SGX RegCo) has reprimanded the former chief executive officer (CEO) and former executive director of Trek 2000 International for breaches of the listing rules.

 

Singapore-listed companies are advised to consult SGX RegCo before appointing former executive chairman and CEO Henn Tan and former executive director Poo Teng Pin as directors or executive officers.

 

The decision was made following an inquiry and review of the company' s past transactions, conducted by RSM Corporate Advisory. The review concluded that agreements entered into by Trek 2000 with T-Data Systems (S) and S-Com Solutions (Hong Kong) were interested person transactions (IPTs).

 

Trek 2000 did not make the requisite disclosures on these IPTs nor seek independent shareholders' prior approval for them. SGX RegCo noted that Mr Tan and Mr Poo pleaded guilty to negligently failing to make immediate announcements on IPTs.

 

RSM also noted that Trek 2000' s management had not put in place guidelines, controls and review procedures for identifying interested persons and IPTs, as well as for valuing, approving and reporting IPTs.

 

SGX RegCo said that it is of the view that Mr Tan and Mr Poo had " failed to act in the interest of shareholders as a whole by failing to safeguard the interest of the company and shareholders" .