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JES International to take possible legal action against former CEO
CHINESE shipping firm JES International could be taking legal action against its former CEO and chairman Jin Xin, after it uncovered financial irregularities related to him. At the same time, it has started proceedings against a former employee who absconded with the group's administrative records and seals.
In a periodic review of its financials, the group discovered that unauthorised payments had possibly been made to Mr Jin, and that "questionable" transactions had taken place between the group and companies in which he had undeclared interests.
While it had intended to conduct an in-depth investigation of these matters, it subsequently found out that its financial records - including account books, cheque books and financial seals - had been removed from its possession by Mr Jin's relatives, said JES on Thursday.
This has left the group in limbo.
"The company is at present unable to conduct a more in-depth investigation into its findings," it said in an announcement, adding that it is also looking into possible actions against Mr Jin's relatives to recover all company property, including the financial records in their possession.
At the same time, four of the group's subsidiaries have started legal proceedings against a former administrative officer with Jiangsu Eastern Heavy Industries Co, who had access to and held on to the group's administration records, as well as the seals of all of JES's Chinese subsidiaries. The employee, Ju Li Li, had absconded with these after Mr Jin's resignation, which was announced in March.
Once the legal proceedings against Ms Ju have concluded, and the group regains possession of the administrative and financial records, it would conduct a more thorough investigation, said JES.
"In the event that the company's investigation into its financial records shows that there may be financial irregularities in the group's accounts, the company will accordingly engage an independent third party auditor to conduct a special audit on the company's financials."
The firm also assured shareholders that it will "not hesitate to take all necessary action against Mr Jin" if the financial irregularities are attributed to him. This would include making a police report in Singapore and starting legal action against him.