Demand for Revamping of SGX
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Tens if not hundreds of China companies have came to the tiny island of Singapore for listings, only for them to shut down after a few years when fraudulent activities occurred within the Chinese organisations (notable ones like China Milk Product Goods Ltd, China Hongxing Sports Ltd and China Fibretech Ltd). Many Singaporeans had already lost their monies -- some even their retirement and children education funds -- to these crooks from overseas.
While the same scenario happened to the United States of America (USA) during the past decade, they had learnt their lessons by conducting more stringent checks and screenings before approving their listings. However, with Midas Holdings being the latest victim, this can’t be said for Singapore.
On 8th February 2018, the trading of shares of Midas Holdings Limited was halted and subsequently suspended. Kindly refer to the sequence of events in the link below which lead to this horrific incident:
As per the timeline in the above link, on 22nd January 2018, Mazars LLP, the auditors of Midas Holdings Limited, found out during its auditing of the company that Midas’ shareholdings in 3 subsidiaries were frozen by China court orders. However, these were not reported to the Board of Directors (BOD). There was also no request of a trading halt of Midas shares immediately (as per Singapore Securities and Futures Act) until 8th February 2018.
These violation of rules and regulations also come with unidentifiable married deal (Read: https://www.businesstimes.com.sg/companies-markets/hot-stock-midas-up-on-s77m-married-deal-say-sources within the period of 22nd January to 8th February 2018 allowed optimistic investors and traders to buy up the shares of Midas.
However, these optimism turned into depression for these people. At least 18,000 investors, had their monies trapped. And these could have been amounted to millions of dollars (SGD).
It was found out that the ex-Chairman, Mr Chen Wei Ping, who has since been booted out of office by SGX, was suspected of being involved in fraud relating to loans (Read: https://www.theedgesingapore.com/midas-says-former-exec-chairman-chen-wei-ping-under-investigation-china-fraud The former CEO, Mr Patrick Chew, had even resigned way before his Chairman counterpart did, an indication of shrieking responsibilities after damaging his blood-and-sweat company inside-out.
A group of trapped investors have congregated together since then, trying to pursue what was going on behind the scenes. Emails after emails were sent to Singapore Exchange Limited (SGX), Monetary Authority of Singapore (MAS), the China embassy in Singapore, even the Prime Minister’s Office (PMO) was not spared, but all we received were standard and computerised answers which none of us wanted. Police reports were made – the Commercial Affairs Department of the Singapore Police Force was notified. But more than three months have passed since the first police report, yet no updates were provided at all till today.
To make matters worse, Midas' auditors issued a statement that the "audit reports for Midas from 2012 to 2016 can no longer be relied upon", "in light of the findings in the course of their audit work for the financial year ended 31 December 2017".(Read: https://www.businesstimes.com.sg/companies-markets/midas-board-says-company-cannot-operate-as-going-concern-auditors-turn-their-back
Securities Investors Association (Singapore), the SIAS, had given Midas the "Most Transparent Company" award for 5 years (2012 - 2016). And the aftermath of this disgusting and laughable episode was that SIAS president David Gerald withdrew all these awards given to Midas, and made a statement which is "irresponsible and unprofessional":
"There was no clue of any wrongdoings by Midas at the time the awards were presented. After all, Midas was a favourite with local equity analysts with broking firms. What must be understood clearly by everyone is that there is no guarantee that a company or a person exhibiting good conduct today may continue to do so in the future. It is also not humanly possible for SIAS or anyone to predict the future perfectly."(Read: https://www.straitstimes.com/business/companies-markets/sias-withdraws-most-transparent-company-award-from-midas
For a chairman to make these excuses and sweep all his actions away irresponsibly and unapologetically, reflects on the arrogance of a powerful man sitting high up the ivory tower. Yet with all these sickening events happening, none of the government or non-government related organisations had responded as to the ongoing investigations we investors yearned for. We have been kept mouth-shut of any solutions presenting to us, and all of us are anxious, because not only our monies are at stake, the reputation of Singapore as a financial hub will be harmed.
With the Chinese government heading towards anti-corruption, and an island country flying its flag up high in the global stage known for having zero tolerance level of corruption activities, it is sad to see there is no progress at all in these investigations.
We demand the Governments of both countries to give the investors an answer, not keeping quiet and hiding away from us, hoping we will sweep this case under the carpet and resume their comfortable life up in the ivory tower.
We also demand to see the relevant Singapore authorities revamp and restructure SGX to give minority shareholders a role to play to enhance oversights of these listed companies.
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