Hong Kong SFC Freezes Suspected Shadow Director Ng Kwok Fai's HK$101 Million in TEAMWAY INTL GP (01239) Case

Stock News12-16

The Hong Kong Securities and Futures Commission (SFC) announced on December 16 that it has obtained a court order from the Court of First Instance to freeze over HK$101 million in cash from the personal bank account of Ng Kwok Fai, a suspected shadow director of TEAMWAY INTL GP (01239). The action was taken under Section 214 of the Securities and Futures Ordinance in legal proceedings related to alleged corporate misconduct.

Previously, Ng and others agreed to pay HK$192 million as compensation for their misconduct, to be redistributed to independent public shareholders of the delisted Kamper Holdings Limited. The current legal proceedings stem from the SFC's investigation into corporate misconduct involving TEAMWAY.

The SFC alleges that Ng and Yang Zhihui acquired control of TEAMWAY in 2015 by purchasing a 75% stake in the company from its founders through nominees. They subsequently acted as shadow directors and transformed TEAMWAY into a "listed shell company" by replacing its original packaging business with new ventures.

According to the SFC's submissions, Ng and Yang, as shadow directors, orchestrated a series of transactions detrimental to TEAMWAY's interests, breaching their fiduciary duties. The SFC further claims that seven former executive directors and three former independent non-executive directors of TEAMWAY approved these transactions and/or allowed Ng and/or Yang to dominate the company's affairs, thereby violating their fiduciary responsibilities. The former company secretary is also accused of negligence or recklessness in handling these transactions.

The SFC is seeking a compensation order against Ng, Yang, and the ten former directors for HK$532 million in losses suffered by TEAMWAY and its subsidiaries. Additionally, the regulator is requesting disqualification orders to bar these individuals and the former company secretary from serving as directors or managing any listed or unlisted corporations in Hong Kong.

The asset freeze against Ng will remain in effect until the conclusion of the legal proceedings involving TEAMWAY or until further court orders are issued.

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