Hearing of Hyflux founder, ex-CEO Olivia Lum, ex-CFO and directors starts Monday

[SINGAPORE] The trial of Hyflux founder and former chief executive Olivia Lum, ex-chief financial officer (CFO), and four independent directors is slated to begin on Monday (Aug 11).

Their trial comes after former director Rajsekar Kuppuswami Mitta, 68, was fined S$90,000 as well as barred from directorship following his guilty plea on Thursday over Hyflux’s failure to disclose information relating to the Tuaspring integrated water and power project in 2011 as required under Singapore Exchange (SGX) listing rules.

Lum also allegedly failed to ensure that Hyflux made disclosures required under the accounting standards for its financial statements for the financial year ended Dec 31, 2017. PHOTO: ST

Lum and the other five accused persons will be jointly tried in the hearing before District Judge Toh Han Li. The trial is scheduled to take place over 57 days until February 2026, court records showed.

Lum, 64, faces six charges: four counts of Companies Act violations and two counts of breaching the Securities and Futures Act.

She was first charged in November 2022, together with the water treatment firm’s ex-CFO Cho Wee Peng and four board members, including ex-director Rajsekar, for disclosure-related offences under the Securities and Futures Act.

She was accused of consenting to the non-disclosure of information relating to the Tuaspring integrated water and power project in 2011, despite such information being required under the listing rules, while the directors were allegedly negligent in the matter.

BT in your inbox

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

She also allegedly failed to ensure that Hyflux made disclosures required under the accounting standards for its financial statements for the financial year ended Dec 31, 2017.

In May 2023, she was subsequently slapped with three counts of breaching the Companies Act, while another independent director, Lee Joo Hai, was charged in March that year over Hyflux’s non-disclosures.

Former CFO Cho will be on trial after being charged with one count of violating the Securities and Futures Act due to allegedly conniving in Hyflux’s intentional failure to disclose information relating to Tuaspring.

Independent directors Teo Kiang Kok, Gay Chee Cheong, Christopher Murugasu, and Lee each face two charges of breaching Securities and Futures Act.

Olivia Lum, 64, ex-CEO

Lum, 64, faces six charges: four counts of Companies Act violations and two counts of breaching the Securities and Futures Act. PHOTO: BT FILE

Charged with six counts: four counts of Companies Act violations and two counts of breaching the Securities and Futures Act

The Securities and Futures Act charges are:

For consenting to Hyflux’s intentional failure to disclose information relating to the Tuaspring Integrated Water and Power Project despite listing rules require it. She could be jailed for up to seven years, fined up to S$250,000, or both, if convicted of this non-disclosure offence.
Over Hyflux’s omission to disclose the information about Tuaspring in the 2011 offer information statement issued for the offer of S$200 million, 6 per cent preference shares on Apr 13, 2011. She faces a jail term of for up to two years, fined up to S$150,000, or both, if found guilty.

The Companies Act charges are:

Failure to ensure that Hyflux made disclosures required under the accounting standards for its financial statements for the financial year ended 2017. She could be fined up to S$50,000 if convicted of this offence.

Those deposits, which the company had undertaken not to withdraw, were with Mizuho Bank.

The financial statements released on Nov 9, 2017, for the third quarter and for the nine months ended September 2017 disclosed restricted bank balances amounting to about S$73.7 million, without the inclusion of US$33.5 million.
Those released on Feb 27, 2018, for the financial year ended December 2017 disclosed restricted bank balances of about S$67 million, which the authorities said should have included the Mizuho Bank deposits of US$33.5 million.
For the statements published on May 9, 2018, for the first quarter ended March 2018, restricted bank balances amounting to about S$65.7 million were disclosed, with US$47.5 million allegedly omitted.

She could be jailed for up to one two year or fined up to S$5,000 for each of these three offences.

Out on bail of S$100,000.

Represented by Senior Counsel Davinder Singh.

Cho Wee Peng, 56, ex-CFO

One count of violating the Securities and Futures Act, due to conniving in Hyflux’s intentional failure to disclose information relating to Tuaspring.

Faces a jail term of up to seven years, fined up to S$250,000, or both, if convicted of this non-disclosure offence.

Out on bail of S$160,000.

Represented by Rajah & Tann lawyers.

All four independent directors were charged with two counts of flouting the Securities and Futures Act:

Neglect in connection with Hyflux’s intentional failure to disclose information relating to Tuaspring, when such disclosure was required under the listing rules. Each faces a jail term of up to seven years, fined up to S$250,000, or both, if convicted.
Liable for Hyflux’s omission to state the material information relating to Tuaspring in the 2011 Offer Information Statement issued for the offer of S$200 million, 6 per cent preference shares on Apr 13, 2011. Each faces a jail term of for up to two years, fine of up to S$150,000, or both, if found guilty.

They are all represented by Shook Lin & Bok lawyers.

Gay Chee Cheong, 68, director