SINGAPORE (May 24): Precision engineering firm Allied Technologies said in a regulatory filing on Thursday it will file a police report over an unauthorised payout of $33 million from its escrow account held with law firm JLC Advisors.
Allied Tech also wants JLC to provide documentary evidence and a statement of accounts of the escrow funds as well as to update it as to the whereabouts of JLC managing director Jeffrey Ong Su Aun.
Allied Tech said it took action after JLC on Wednesday wrote to Allied Tech saying it has reasons to believe that the payout, instructed by Ong, “might have been unauthorised”. The law firm also told Allied Tech it is investigating the matter and has reported the matter to the authorities.
In response to Allied Tech’s Thursday filing, Singapore Exchange Regulation (SGX RegCo) issued a second notice of compliance, saying it will object to any appointment of Ong as a director or executive officer of any company listed on the SGX until the matters have been resolved.
SGX RegCo also ordered a special auditor to report the audit findings to it directly.
Ong had resigned from his position at Annica Holdings as non-executive and independent director with immediate effect on Monday, citing personal reasons. However, Annica had been unable to arrange for an exit interview with Ong.
See: Annica chairman Ong quits just as JLC senior partner goes missing with $33 mil of clients' money
See also: Law Society moves to take control of money held with JLC
In its first notice of compliance issued on May 8, SGX RegCo instructed Allied Tech to appoint the special auditor after the latter’s auditors had flagged concerns related to the $33 million in funds which were being held in escrow by JLC without any formal agreement.
In its Thursday filing, Allied Tech said JLC failed to release the balance of its escrow funds despite repeated demands since March 23, which included a letter of demand on May 17 by law firm Rajah & Tann.
“This is notwithstanding that at all material times, JLC Advisors’ managing director, Mr. Ong Su Aun, Jeffrey, had repeatedly represented to the Company that the release of the escrow funds would be forthcoming ...or that JLC would not comply with the Company’s request to release the escrow funds in accordance with the Escrow Agreement,” wrote Allied Tech.
Allied Tech also clarified that the amount to be repaid is actually $33.2 million and not $33.4 million as stated in JLC’s letter.
On Wednesday, Allied Tech announced the termination of a memorandum of understanding related to a proposed acquisition of shares in Aik Chuan Construction.
See also: Allied Tech's $130 mil purchase of dorm operator aborted amid news of missing funds
The proposed $130 million takeover was to be paid with $30 million and $50 million in cash, with the balance to be paid through new Allied Tech shares.
