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CNA
3 days ago
- Business
- CNA
Hyflux trial: Ex-CEO Olivia Lum's lawyer grills lead investigation officer
SINGAPORE: The lead defence counsel for Olivia Lum Ooi Lin, the former chief executive officer of now-defunct homegrown water treatment firm Hyflux, on Monday (Aug 11) grilled the investigation officer in charge of a probe into the company's top officers about the way she handled the investigation. Lum, 64, is on trial for two charges under the Securities and Futures Act for leaving out information about Hyflux's Tuaspring project pertaining to its sales of electricity in two key public statements in 2011. Hyflux successfully bid for the project in 2011, in response to a tender conducted by the Public Utilities Board, now known as PUB. The project had been pitched to the market as Hyflux's second and largest seawater desalination plant in Tuas, with the company raising S$400 million (US$310 million) from the issuance of preference shares. However, the company allegedly did not reveal at the time that it would fund the sale of water at a very low price to national water agency PUB, with a new business of selling electricity from a power plant it would build. Hyflux, Singapore's first publicly listed water treatment and seawater desalination company, later suffered massive losses after a fall in electricity prices and entered liquidation in July 2021. The collapse of the company left investors with significant losses, including about 34,000 investors holding perpetual securities and preference shares who were owed a total of S$900 million. DAVINDER SINGH PLACES IO UNDER CROSSHAIRS On Monday afternoon, Lum's lead lawyer Senior Counsel Davinder Singh questioned the prosecution's first witness about the manner in which she had taken statements from Lum. In response to his questioning, lead investigating officer Wei Maojun, Jacqueline from the Commerical Affairs Department (CAD) shared her background: She studied accountancy at Nanyang Technological University before joining PricewaterhouseCoopers as an audit associate. She then joined the CAD in 2014. "So you have never been in the industry? In the market, in listed companies?" asked Mr Singh. "Yes," said Ms Wei. She added: "I may not have had experience in the corporate world, but in my experience as an investigator ... we do (understand) the (SGX) listing rules. Besides that, we did seek views from regulators, experts and the prosecution before ... (framing) the charges," she said. She had agreed earlier to Mr Singh's suggestion that she had been the one who came up with what was defined as the omitted information in the charges faced by Lum. Initially, she said she approached a securities expert, Mr Kevin Gin, before the investigations into the case commenced. She agreed that she had provided Mr Gin with a document called "terms of reference", where she asked Mr Gin to assume certain facts concerning the allegedly omitted information in forming his expert opinion. Mr Singh questioned Ms Wei on when she provided the terms of reference to Mr Gin, but she said she could not remember. "You see it's interesting that you say that about events that took place just two to three years ago. You can't remember, right?" said Mr Singh. "You were the IO in charge of this investigation. And getting expert opinion was an important part of this investigation." The judge intervened and said it would not be fair to ask Ms Wei on the stand like that to test her memory, asking if she could look at some notes or her diary. Mr Singh then showed evidence to Ms Wei that the terms of reference had been given to Mr Gin in December 2023. "It would therefore appear, Ms Wei, that my client was charged in November 2022 about omitting the information, even before you obtained Mr Gin's expert report in relation to the implications of the omission of the information, correct?" asked the seasoned lawyer. Ms Wei agreed. "Therefore, I suggest to you that what happened was that, having come to the view of what the information was, which should have been included but was omitted, you then set about to get an expert to back you up on that, right?" asked Mr Singh. He also put it to Ms Wei that when Lum was charged, Ms Wei "did not even have Mr Gin's expert view on the implications of the omission of the information". Ms Wei disagreed and said the investigators had engaged Mr Gin and sought his view even before investigations commenced. However, she later agreed with Mr Singh when he said it was she who came up with the list of information that should have been disclosed and not Mr Gin. Mr Singh then repeatedly asked Ms Wei about specific questions she had asked Lum during her statement taking. He pointed out that Lum had stated many times that she simply could not recall because it had been nine or 10 years ago. At one point, Mr Singh parsed an answer by Lum in a police statement, saying that Lum was saying it happened 10 years ago and that she could not recall primarily because of the time gap. Ms Wei replied: "Possibly." "Not possibly, primarily," said Mr Singh. "You had trouble with two years ago." Ms Wei responded that it was not for her to speculate how Lum felt. CONFIDENTIALITY AGREEMENT At another point, Mr Singh pointed Ms Wei to one question she had asked Lum during the statement recording, where Ms Wei asked Lum why Hyflux had not disclosed the "extent of the significant revenue exposure". Lum had said "I cannot remember why we didn't do so". She then added: "I also want to let you know that we have to abide (by) a confidentiality agreement signed with PUB, so there were limitations on the extent of disclosure we can make as well." Mr Singh questioned Ms Wei on whether she was aware about this confidentiality agreement. "Did you yourself check and confirm there was this confidentiality agreement?" asked Mr Singh. "I don't recall whether we did check whether there is a confidentiality agreement," answered Ms Wei. "But it's an important point that she made, right? And yet you didn't check it?" asked Mr Singh. "We asked if PUB would have concerns if they wanted to disclose (certain things), so in a way we did check," said Ms Wei. "But that's not answering my question," countered Mr Singh, repeating his question again. Ms Wei later said the investigators did ask for a few agreements between PUB and Hyflux, and they understood that as part of the agreement, there was "some confidentiality involved", with regard to the proposal and the purchase of water agreement. Mr Singh had earlier told the court that he would take at least the whole afternoon to cross-examine Ms Wei. Once he is done, the lawyers for the other accused former leaders of Hyflux will take their turns cross-examining Ms Wei on Tuesday. The others on trial are Cho Wee Peng, 56, former Hyflux chief financial officer; as well as former independent directors of Hyflux Gay Chee Cheong, 68; Teo Kiang Kok, 69; Murugasu Christopher, 66; and Lee Joo Hai, 69. The trial is set to continue until Wednesday this week, before resuming next Monday. Trial dates have been set as far as January next year. If convicted of consenting to Hyflux's intentional failure to disclose the electricity sale information to the securities exchange, Lum can be jailed for up to seven years, fined up to S$250,000, or both.
Malay Mail
5 days ago
- Business
- Malay Mail
After years of delays, Singapore's biggest corporate scandal trial starts tomorrow
SINGAPORE, Aug 10 — The trial of Hyflux founder and former chief executive Olivia Lum Ooi Lin, former chief financial officer Cho Wee Peng, and several former board members will finally start tomorrow, nearly three years after they were charged under the Securities and Futures Act. Seven individuals were accused of failing to disclose key information about the Tuaspring Integrated Water and Power Project, which later became central to Hyflux's financial collapse. Six defendants will contest the charges in a 56-day trial running until Feb 5, 2026, while one former independent director has already pleaded guilty, Singapore's The Straits Times reported. The case follows Hyflux's 2021 winding-up order, which left about 34,000 investors — including some from Malaysia — with total losses of around S$900 million in perpetual securities and preference shares. Prosecutors will proceed on 11 charges against the six defendants, including two of the six counts faced by Lum, while four other charges against her will be considered during sentencing if she is found guilty. The first charge alleges that Lum consented to Hyflux withholding information about Tuaspring when disclosure was required under Singapore Exchange rules to prevent a false market in its securities. Prosecutors say Lum failed to inform the exchange that Tuaspring was Hyflux's first step into the electricity market and that the plant's profitability depended heavily on electricity sales revenue. If convicted of this charge, the 64-year-old faces a maximum penalty of seven years in prison, a S$250,000 (RM824,000) fine, or both. The second charge accuses her of omitting the same information in Hyflux's April 13, 2011, offer statement for S$200 million worth of 6 per cent preference shares, an offence that carries up to two years' jail, a S$150,000 fine, or both. Cho, 56, who also served as Hyflux's group executive vice-president, faces charges of conniving in the omission of Tuaspring-related information. Four former independent directors – Teo Kiang Kok, 69; Christopher Murugasu, 66; Gay Chee Cheong, 69; and Lee Joo Hai, 69 – each face two charges of neglect and omission of material details about Tuaspring. Another independent director, Rajsekar Kuppuswami Mitta, pleaded guilty on Aug 7 to neglect in a 2011 announcement that named Hyflux as the 'preferred bidder' for Tuaspring without disclosing it was entering the electricity business, and was fined S$90,000 and barred from directorship for five years.
