Federal Court makes landmark ruling in Transmile case

PETALING JAYA: The Federal Court has ruled that principal officers and directors are liable if the companies they represent furnish misleading information.

In a landmark decision, it ruled on Wednesday that the provisions making them liable, contained in Section 122(1) of the Securities Industry Act 1983 (SIA), did not violate the federal constitution.

The Federal Court’s decision implied that the charges made against Transmile Group Bhd’s former chief executive officer Gan Boon Aun by the Securities Commission for corporate offences were valid. 

It, therefore, ordered Gan’s case to be remitted to the Sessions Court for continuation of the trial.

Gan was charged in 2007 by the SC for abetting Transmile in making a statement that was misleading in a material particular relating to the company’s revenue in its quarterly report on unaudited consolidated results for the financial year ended Dec 31, 2006.