KUALA LUMPUR (Oct 13): The Securities Commission Malaysia (SC) has reprimanded China Automobile Parts Holdings Ltd (CAP) as well as its current and former directors and chief financial officers for various breaches of the securities laws.
SC said CAP’s prospectus for its initial public offering (IPO) contained financial statements of its wholly-owned subsidiary QuanZhou FenSun Automobile Parts Co Ltd that were false or misleading.
This was due to the overstatement of FenSun’s bank balances, said the regulator in a statement.
CAP was listed on the Main Market of Bursa Malaysia Securities Bhd on Jan 30, 2013.
“Between 2013 and 2018, CAP had furnished false or misleading financial statements to Bursa Malaysia due to overstatement of FenSun’s bank balances.
“Further, CAP failed to disclose litigations in relation to bank loan defaults by FenSun and did not recognise outstanding liabilities of FenSun’s bank loans in its financial statements,” said SC.
SC reprimanded CAP’s former managing director Li Guo Qing, former non-independent non-executive vice chairman Ong Juan Tee and current executive chairperson Wang Yu Yun for causing the submission and authorising the issuance of CAP’s prospectus that contained financial statements that were false or misleading, and knowingly permitting the furnishing of false or misleading financial statements to Bursa Malaysia.
It also reprimanded CAP executive director Chen Xunze and two of CAP’s former chief financial officers, Lai Fong Ling and Chai Wai Teck, for knowingly permitting the furnishing of false or misleading financial statements to Bursa Malaysia.
“All persons in breach did not file any appeal against the SC’s reprimand within the prescribed time provided under the Capital Markets and Services Act,” said SC.
The regulator also expressed its opinion that the retention of office by Wang and Chen is prejudicial to public interest.
CAP’s share price closed unchanged at one sen for a market capitalisation of RM13.62 million.