SINGAPORE (June 5): Allied Technologies said it was Low Yew Shen, a partner at Elitaire Law LLP which was handling the firm’s proposed placement exercise, who had recommended law firm JLC Advisors to the company to act as its escrow agent in October 2017.
However, Allied Tech said Low did not explicitly recommend Jeffrey Ong Su Aun, the managing partner of boutique law firm, to any member of the company although it was a paralegal from Elitaire who had attached Ong’s and JLC’s profile for the company’s review, added Allied.
Ong, 42, disappeared before news broke that $33 million held in escrow on behalf of Allied Tech by his law firm had gone missing. Ong had also resigned as chairman of Annica Holdings on May 20 via email to the company, citing personal reasons.
Allied Tech on May 24 announced it had reasons to believe that the $33 mil payout from its escrow account with JLC, instructed by Ong, “might have been unauthorised”. JLC had also informed Allied Tech it is investigating the matter and has reported the matter to the authorities.
See: CAD seizes Allied Tech documents for investigations; retains director's electronic belongings & passport
See: Allied Tech files police report over unauthorised $33 mil payout by JLC MD Ong
In its filing on Wednesday night, Allied Tech’s management said it had considered appointing Elitaire Law as the escrow agent but as the proceeds from the proposed placement was sizeable, the then management was of the view that it would be more prudent to engage a sizeable law firm.
“Hence, Elitaire Law LLP recommended JLC as one of the options to be the escrow agent,” said Allied Tech in its response to queries by the Singapore Exchange.
Among the other responses, Allied also said it was former CEO, group managing director and major shareholder Hsu Ching Yuh who had introduced and recommended Pok Mee Yau, a partner at JLC, after the board spoke to the law firm, asking for them to recommend a suitable candidate, preferably with legal knowledge, to join the board.
Allied said it was cognisant that Pok was one of the salaried partners at JLC but as Pok was not one of the signatories for the release of the escrow monies, no concerns were raised.
Pok as appointed independent director at Allied Tech on Oct 31, 2017, after the escrow agreement was entered into on Oct 23, 2017.
Since the incident, Pok, another Allied Tech executive director Lim Jin Wei, and executive director Kenneth Low Si Ren have recused themselves due to conflicts of interest.
See also: Allied Tech recuses three directors, including JLC partner
In last night's filing, Allied Tech also answered questions raised on the disposal of entire stake in Allied Machineries (Shanghai) Co (AMSH) and Allied Technologies (Suzhou) Co. (ATSU).
Allied Tech said the purchaser of AMSH was Carapace Daybreak, whose sole director and shareholder at the material time was Chang Kuo-Yung who was introduced to the company by former CEO Hsu, a fellow Taiwanese.
As for ATSU, the purchaser is Madam Hong Siou-Jhu, a businesswoman residing in Taiwan who was mainly involved in business relating to the manufacturing and sale of electronic components and related products and had wanted to expand her business into China.
The purchaser was again introduced to the company by Hsu.
Allied also confirmed that the total of $1.18 million paid to Hsu over four instalments between April 4 2018 and Jan 22 was for compensation after the latter had resigned from the company with effect from Dec 27 2017.
This was under a termination agreement dated Dec 18 2017 signed between the company and Hsu which had been discussed and approved by the board.
See also: Allied Tech's $130 mil purchase of dorm operator aborted amid news of missing funds
Allied Tech shares last traded at 1.1 cents on May 2, before it requested for a trading halt on May 3 and recommended on May 8 that the trading halt be converted to a voluntary trading suspension with immediate effect.
