Former Pokka CEO Alain Ong and 2 Kimly directors charged for disclosure offences

F&B firm Kimly's executive chairman Lim Hee Liat and executive director Chia Cher Khiang and former CEO of Pokka International, Alain Ong, have been charged for disclosure offences under the Securities and Futures Act and the Companies Act. Lim and Chia were each charged with one count for failing to notify the Singapore Exchange of Kimly's acquisition of rival beverage brand Asian Story Corporation (ASC) that was announced on 2 July 2018. 

The Singapore Police Force (SPF) said in a statement that Kimly's acquisition was "an interested person transaction" that should have been disclosed under the SGX Catalist Rules, but was not. Lim was further charged with one count under Section 156 of the Companies Act for failing to disclose his interest in the acquisition of ASC to Kimly. Section 156 states that every director or CEO of a company who is in any way, whether directly or indirectly, interested in a transaction or proposed transaction with the company shall declare the nature of his interest at a meeting of the directors of the company, or send a written notice to the company containing details on the nature, character and extent of his interest in the transaction or proposed transaction with the company. Kimly said in a regulatory update that Lim and Chia have both resigned from the board.

Meanwhile, Ong faces three charges under Section 156 of the companies Act. According to the SPF, it was alleged that Ong, who was also director in Pokka International and Pokka Corporation, had partial beneficial ownership of ASC and failed to disclose his interest to Pokka International and Pokka Corporation on three occasions when ASC entered into transactions with the two Pokka entities.

If convicted, the accused persons face imprisonment not exceeding seven years, a fine not exceeding SG$250,000, or both, under each count of the SFA charges; and imprisonment not exceeding 12 months, or a fine not exceeding SG$5,000, under Section 156 of the Companies Act charge. 

Ong was sued by Pokka in 2019 for SG$10 million in losses. The company alleged that Ong was part of a conspiracy behind the IPO of coffee shop operator Kimly, which had later acquired ASC. Pokka’s filing also said Ong also became a non-executive and non-independent director of Kimly in February 2017, a month before it was listed on the Singapore Exchange. His involvement with Kimly and Asian Story, according to Pokka, was not fully disclosed. According to The Straits Times, the lawsuit was settled last year. Meanwhile, Ong was made to leave the company in 2018. 

That same year, Pokka also ended its endorsement deal with actress and host Vivian Lai, who is Ong's wife. The company said then that the change was being made as part of its "ongoing marketing strategy" but declined to provide more details.

Photo courtesy: 123RF

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