Scan Associates discloses reason for suspending director

New high for Dagang NeXchange Bhd

KUALA LUMPUR: Scan Associates Bhd director Yeoh Eng Kong, who was suspended for more than five months to facilitate an investigation against him, had been penalised for seeking an extension of time to submit a regularisation plan without the board’s knowledge and approval.

This was the ICT security solutions company's answer to Bursa Malaysia Securities’ query on the details of Yeoh’s breach of duties as director.

Scan had suspended Yeoh as director for two months in September last year but extended the period of his suspension twice, as an investigative committee set up by the company needed more time to analyse and conclude the case against him.

The suspension was finally uplifted with effect from Feb 17, the day after the committee concluded that Yeoh had indeed breached his duties as a director.

In its announcement on the withdrawal of the suspension earlier this week, Scan did not disclose how Yeoh breached his duty as a director but said it would not take any further action against him, as “his suspension period is adequate and deemed to serve the purpose.”

In the latest announcement on Friday, Scan explained that Yeoh had sought for a time extension to regularise the company’s financial position via his letter to Bursa Securities dated May 16, 2016, even though the majority of the board had decided not to appeal for such an extension.

The Guidance Note 3 company noted that Yeoh, who is its largest shareholder, had full knowledge of the board’s decision.

Scan’s securities were at first scheduled to be de-listed on May 31, 2016.

In September last year, Scan announced that it had submitted an application to Bursa Securities for an appeal against the de-listing and sought a one-year extension for the submission of a regularisation plan to Bursa Securities.

In December last year, the regulator agreed to give an extension until May 31 this year for it to submit a regularisation plan.

Scan so far has not explicitly said that the investigative committee had been dissolved. One of the matters that it was supposed to probe was related to “the preparation of the company’s subsidiaries’ audited financial statements.”

In the initial announcement on Yeoh’s suspension on Sept 9 last year, Scan said the board decided to form a committee to investigate “the possible serious breach of duties of a director and the preparation of the company’s subsidiaries’ audited financial statements.”

Scan’s external auditor Baker Tilly Monteiro Heng had in June last year tendered its resignation as auditors of the company and its subsidiaries. The reasons given were the outstanding amount of professional fees and the receipt of the writ and statement of claim filed by Yeoh on May 16.