Midas Holdings' former CEO charged under the Companies Act

Mainboard-listed Midas Holdings' former chief executive has been charged with an offence under the Companies Act (CA), for allegedly failing to use reasonable diligence in the discharge of his duties as a director of Midas.

The charge relates to Chew Hwa Kwang Patrick's "failure to exercise reasonable supervision over the financial affairs of Midas' subsidiaries", Jilin Midas Aluminium Industries Co (JMA) and Luoyang Midas Aluminium Industries Co (LYMA), the Singapore Police Force (SPF) said in a press release on Thursday (Feb 10).

"Chew had allegedly ceded control of his legal representative stamps for JMA and LYMA, which were then used to enter into loans or stand as loan guarantors in the name of the two subsidiaries," the SPF added.

The value of these loans and guarantees - that were entered into between 2015 and 2017 - amounted to RMB 159.5 million (about S$32.7 million) and RMB 264.5 million respectively.

Railway parts maker Midas flagged the discovery of the loans and guarantees in February 2018.

If convicted for an offence under Section 157(1) of the CA, per Section 157(3) of the CA, Chew faces imprisonment for a term which may extend to a maximum of 12 months, or a fine of up to S$5,000.

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The stock has been suspended from trading since February 2018.