PERAK-based lingerie and apparel manufacturer Caely Holdings Bhd, which is embroiled in allegations of corruption, misconduct and misuse of funds, has appointed four retired senior police officers to its board of directors — the first listed company on Bursa Malaysia to appoint that many law enforcement officers at this level.

Their appointments come amid an investigation into alleged misappropriation of funds in the group by the Bukit Aman Commercial Crime Investigation Department (CCID).

The Edge was told that the investigation into the case is still ongoing despite recent changes in the board that saw the removal of all seven members, including its then group executive chairman Datuk Mike Loh Ming Choon.

According to people familiar with the investigation, officers had raided the offices of Caely on Sept 14 based on a police report lodged with the Bukit Aman CCID by Datin Seri Jessie Wong Siaw Puie, who was Caely’s executive vice-chairman until she was removed from her post following a Kuala Lumpur High Court ruling on Aug 29.

During the raid, CCTV camera footage, taken on an earlier date, showed the driver of an executive director carting boxes of documents, believed to contain evidence of the alleged misappropriation of funds, out of the office to his car, the people said.

This led to the police detaining the driver under Section 201 of the Penal Code for disposing of or hiding evidence of a crime with the intention of avoiding punishment under the law. On Sept 16, the driver handed over the boxes of documents to the police, they added.

Coincidentally, Caely’s founder Datin Fong Nyok Yoon — who is named as one of 12 defendants in a recent lawsuit over alleged misappropriation of RM30.55 million in funds from its wholly-owned subsidiary Caely (M) Sdn Bhd (CMSB) — tendered her resignation as non-executive director on Sept 15, a day after the police raid.

The raid is the latest in a string of lawsuits and police reports against former and current shareholders, as well as directors of the company. On Aug 29, the High Court ruled in favour of three requisitionists of Caely’s extraordinary general meeting (EGM) held on June 15, namely Leong Seng Wui, Kok Kwang Lim and Valhalla Capital Sdn Bhd, and ordered the resolutions carried out during the EGM to take effect as of that date. This saw Loh and six other directors booted out of the board and the appointment of four new directors — Leong, Datuk Kang Chez Chiang, Ng Keok Chai and Krishnan Dorairaju.

Leong was previously executive director at Macpie Bhd, now known as XOX Networks Bhd, and former group chief operating officer of 1 Utopia Group. He is now group executive director of Green Packet Bhd.

Filings with Bursa showed that Ng, who was appointed as executive director following the ruling, was redesignated as executive chairman effective Aug 29. Ng, 63, was a former assistant commissioner of police and his last-held position was that of principal assistant director in the forensic accounting investigation division of Bukit Aman CCID. He had served the police force for over 36 years and also held directorships in Green Packet, Dynaciate Group Bhd, Hong Seng Consolidated Bhd and Ingenieur Gudang Bhd.

Kang, 64, who now holds the position of independent non-executive director at Caely, was formerly a deputy commissioner of police. He had served the police force for over 39 years, holding many key appointments, including head of the Intelligence Section and Narcotics Crime Investigation Department, Kuala Lumpur Police Contingent. He is also a director of Advance Information Marketing Bhd.

On Sept 27, Caely appointed two more police officers to its board. Chong Seng Ming, 61, previously a police inspector, is currently a practising lawyer, while Datuk Pahlawan Mior Faridalathrash Wahid, 60, has more than 40 years of experience as a police officer in various roles dealing with crimes and the criminal justice system, Bursa filings showed.

Source: RM31 mil lawsuit still on despite change at board level

Back then, Loh and the former board had filed a civil lawsuit on Aug 26 in the High Court in Ipoh against Fong and her husband Datuk Chuah Chin Lai, who was the group’s managing director from October 2002 to April 2021, to demand the return of RM30.55 million allegedly misappropriated by the couple.

The suit further alleges that Fong and Chuah, with the help of 10 other individuals and groups who collectively own 50.01% of Caely shares, conspired to cover up the misappropriations and breaches of fiduciary duties, and to obstruct Caely’s further in-depth investigations by attempting to remove the current directors by calling for an EGM, and appointing their nominees to the board.

In addition to Fong and Chuah, those named in the suit as defendants include Penang-based businessman Datuk Seri Goh Choon Kim, who is the largest shareholder of Caely with a 21.05% stake as at May 30, 2022; Leong; Kok and Valhalla Capital.

But the lawsuit has been withdrawn by the group under the new board, a person familiar with the matter told The Edge.

According to the source, Loh and several other directors who were recently ousted are, however, not giving up. They are continuing with the lawsuit as shareholders of Caely, instead of on behalf of Caely and CMSB.

“When they (Leong, Kang, Ng and Krishnan) took over the board, the first thing they did was to call back the lawsuit because they didn’t want the lawsuit to continue. They have also withdrawn (Caely’s former attorney) Messrs Bachan & Kartar from the case. However, the previous board is continuing the lawsuit as shareholders of the company and has appointed Bachan & Kartar to lodge the lawsuit against the 12 defendants,” the source said.

Meanwhile, in a statement last Wednesday, Ng said the new board of Caely has vouched that they will leave no stones unturned and will provide full assistance on the ongoing investigation into the alleged misappropriation of RM30.55 million in funds from CMSB.

He added that the group has “initiated internal inspections and will engage independent forensic specialists to conduct investigations in order to support and facilitate the investigations conducted by the authorities such as the police, the Malaysian Anti-Corruption Commission, Bursa and others to protect the best interests of the stakeholders from the possible misconducts or wrongdoings of the former board”.