KUALA LUMPUR — The High Court today upheld the conviction and sentence of former Axis Incorporation Berhad (Axis) board adviser Lee Koon Huat for abetting the company in submitting false financial statements to Bursa Malaysia.
High Court judge Noor Ruwena Md Nurdin dismissed Lee’s appeal against his conviction and sentence, ruling that the prosecution had proven all four charges against him beyond reasonable doubt.
The court affirmed the Sessions Court’s sentence of six months’ imprisonment and a RM200,000 fine for each charge, amounting to RM800,000.
However, the High Court granted Lee a stay of execution of his imprisonment pending further proceedings but rejected his application to suspend payment of the fine.
Lee was required to pay the RM800,000 fine by today, failing which he would face imprisonment in default of payment, according to the Securities Commission Malaysia (SC).
Lee was initially charged in the Sessions Court on March 26, 2013, under Section 122C(c), read together with Section 122B(a)(bb) of the Securities Industry Act 1983.
The four charges involved abetting Axis in furnishing false financial statements concerning its revenue for the 2007 financial year.
Evidence presented during the trial established that Lee had instructed the inflation of the company’s reported revenue in its four unaudited quarterly financial results for that year.
On April 11, 2022, Sessions Court judge Azman Ahmad found Lee guilty on all four charges following a full trial and imposed the sentences, with the imprisonment terms to run concurrently.
Three former Axis executive directors – Lee Han Boon, Saipuddin Lim Abdullah and Koh Tee Jin – had also been charged with knowingly permitting the submission of false financial statements relating to the company’s revenue for the 2007 and 2008 financial years.
All three pleaded guilty midway through the prosecution’s case through plea bargaining applications and received prison sentences ranging from one day to 12 months. Lee Han Boon and Koh Tee Jin were also fined RM200,000 each.
The trial subsequently proceeded against Lee alone.
The SC said the High Court agreed with its submission that the sentence was appropriate given Lee’s role in the offences.
It said the court’s decision reaffirmed the importance of accuracy and integrity in financial reporting by public-listed companies and reiterated its commitment to taking firm enforcement action against those involved in disseminating false or misleading information to investors.
—SC
