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Hin Leong responds to PwC's report, says Mr Lim was unwell
THE boss of stricken oil trading firm Hin Leong Trading was not given a "reasonable opportunity" to respond to fraud allegations laid out in a recent report by PricewaterhouseCoopers (PwC) Advisory Services, his family said in a press statement on Thursday night.
PwC, the court-appointed interim judicial manager (IJM) for Hin Leong, alleged in a report filed with the Singapore High Court on Tuesday that the company had misled banks into lending it money. The oil trader also overstated its assets by at least US$3 billion and used fictitious profits to hide US$808 million in trading losses over the last 10 years, PwC alleged.
But the statement argued that Mr Lim had not been given a reasonable opportunity to put forward facts and arguments in justification of his conduct and to respond to any criticism against him.
PwC said in its report that it had not been able to interview Mr Lim, who is in his late 70s, as it had been told by Davinder Singh Chambers (DSC), the lawyers for the Lim family, that Mr Lim is "suffering from various medical conditions, in deteriorating health and unfit to be questioned for prolonged periods of time".
But the Lim family objected to this description as it had provided PwC with copies of medical certificates from a specialist in respiratory medicine, a cardiologist and a psychiatrist, certifying Mr Lim unfit for work for various periods in April, May and June.
"None of this was disclosed in the report," the statement said. It was signed by Hin Leong's founder Lim Oon Kuin, better known as O.K. Lim; his son Evan Lim Chee Meng; and his daughter Lim Huey Ching.
The family also took issue with the fact that PwC had not applied to have its report sealed or kept confidential.
PwC became the IJM for Hin Leong on April 27 and was given a June 22 deadline to submit a report to the court, including a preliminary assessment of the financial irregularities that Mr Lim had admitted to in an affidavit filed on April 17. In the affidavit Mr Lim had revealed that the oil trader had suffered about US$800 million in futures losses over the years, which were not reflected in its financial statements.
In his April 17 affidavit Mr Lim also proposed that Hin Leong's debt restructuring be intertwined with that of Ocean Tankers, a separate entity that is owned by the Lim family. The restructuring plan would "likely" include an injection of assets by the Lim family, such as their shares in the Xihe Group and Universal Group Holdings, Mr Lim wrote at the time.
In May, the family hired nTan Corporate Advisory and DSC to act for them.
On May 20, the IJMs had sent an open letter to DSC seeking the family's confirmation that they remain committed to all efforts to rehabilitate Hin Leong and that they would inject their personal assets into and as part of the restructuring.
PwC said in its report that it did not receive a reply from DSC.
The Business Times has written to Mr Evan Lim for clarification on the restructuring terms, and to ask if the family will be responding to the specific allegations put forth in the PwC report.