On June 10, former Silver Bird Group Bhd managing director Datuk Jackson Tan Han Kook and former CEO Derec Ching Siew Cheong were acquitted of 134 charges of cheating and allegedly using forged documents to swindle a bank of almost RM67.4 mil.
This is the culmination of a case that first came up in 2012, when the duo were jointly charged in 2012, when they claimed trial for cheating Malayan Banking Bhd (Maybank) by using forged papers to apply for the bank’s acceptance facilities for three companies.
Both men were charged under Section 471 of the Penal Code for using false documents, as well as under Section 420 of the Penal Code for cheating.
Under the first section, both would have been liable to a fine, as well as a jail term that may extend up to seven years, while the latter would have seen both again be liable to a fine, as well as a jail term not shorter than a year, and no longer than 10 years, with whipping.
The documents referred to as false in the charges were invoices totalling over RM67.4 mil, which were allegedly delivery orders made out to Stanson Marketing and Koperasi Permodalan Felda Quality.
The initial trial was judged by Sessions Court Judge Mohd Nasir Nordin, with the duo acquitted as the defence managed to raise reasonable doubt in 2016.
The prosecution then appealed that decision to the High Court, which dismissed the appeal, with the decision upheld by a three-member Court of Appeal bench on June 10, 2020, led by Justice Datuk Kamardin Hashim, who noted that the bench had found no merit in the prosecution’s appeal.
This is also the final appeal by the prosecution, considering the case was first heard in the Sessions Court, and parties are only allowed a two-tier appeal process.
Tan said the charges had caused a lot of stress to him and his family. “The truth has set me free,” he told business publication The Edge.
Minority Shareholder Watchdog Group (MSWG) CEO Devanesan Evanson said that there were two perspectives that this had to be viewed from.
“The first, being obvious in hindsight, is that there was something wrong with the company. The facts also show this clearly. A listed company, from a resilient sector no less, suddenly has financial issues, is declared PN17, is delisted, and subsequently shut down. The management, and to a smaller extent, the board of directors, should be held responsible, because obviously someone was not on the ball,” Devanesan told FocusM.
The second perspective, he said, was that this is a court decision, with the decision made based on the facts and the way the prosecution approached the case.
“The courts have acquitted Ching and Tan, and there could be many reasons why the courts ruled that the acquittal stands. The evidence may not have been strong enough, or there could have been some technicality, such as the wrong section being used to address the case,” said the MSWG CEO.
“Ultimately, the court has made its decision, and that has to be taken into consideration. We need to read the judgment to better understand the reason for acquittal beyond there being no merit to the prosecution’s appeal.”
What happened to Silver Bird?
Silver Bird, a company known for its “High 5” brand bread loaf, came under scrutiny for missing RM112 mil from its finances in 2012, which later turned out to be a much larger sum of RM297 mil. Of course, this was extremely detrimental, especially in the financial sense, for the company.
This gap in the finances saw the chairman of the board at the time, Datuk Gan Khuan Poh, relieving Tan and Ching, as well as the general manager of accounts and finances, Lai Poh Mei, of their positions.
The termination was then followed by a lawsuit from Ching, who filed a suit for wrongful termination and for RM2 mil in losses he suffered from the forced sale of his stake in Silver Bird, which he noted arose from the “board’s mismanagement” and PN17 status after the termination.
This led to a counter-suit from Silver Bird to the tune of RM125 mil against Tan, Ching and Lai in August 2012 for fraud and for conspiring to defraud the company, with Silver Bird also naming Triremis (M) Sdn Bhd, Triremis Asia Sdn Bhd, Bill Davis & Associates Sdn Bhd and its distributor Asia Food Link Sdn Bhd (AFL) as defendants in the suit.
However, Tan and Ching were acquitted of the charges of criminal breach of trust in December 2015, which followed the group coming into financial difficulties following the discovery of the hole in the finances. Silver Bird was then forced to downsize before it fell into PN17 status.
Subsequently, the group was delisted in 2014, despite efforts from Covenant Equity Consulting Sdn Bhd and Suncsi Holdings Sdn Bhd who had injected RM16 mil into Silver Bird, who was known as High-5 Conglomerate Bhd by then in July 2013.
Following its delisting, the group continued to face financial difficulties, subsequently shutting down in June 2016, following the court order from AmanahRaya Real Estate Investment Trust requiring the group to leave the premises where it was operating from, namely its headquarters in Shah Alam, by July 17, 2016. – June 11, 2020
