BT EXCLUSIVE

Confusion over whether ex-CEO still has role in Yuuzoo

Singapore

CONFUSION has arisen over whether social-media company YuuZoo's Singapore chief executive officer (CEO) Mohandas continues to play a role in the company.

Mr Mohandas, who goes by one name, told The Business Times yesterday that he does not; he had resigned on March 5 and that the resignation took effect yesterday, he said.

A letter of resignation dated March 5 and seen by BT said he had resigned from "all other official positions or directorships" undertaken for all subsidiaries of YuuZoo, in addition to his stepping down from the CEO and executive director role.

However, before the market opened yesterday, a bourse filing submitted by lead independent director Anthony Williams said the company had redesignated Mr Mohandas from executive chairman to non-executive director of the company.

In another regulatory filing, also submitted yesterday, before the one about the redesignation, YuuZoo Networks Group (YNG) Corp, formerly YuuZoo Corporation, announced the closure of all its Singapore-based subsidiaries and termination of all its Singapore-based employees.

That filing, also submitted by Mr Williams, provided "non-executive director" Mr Mohandas' details as a contact for queries.

In it, YuuZoo said the closures and staff layoff were a "direct consequence" of its trading suspension.

The group said it was unable to pay local salaries, including that of its Singapore CEO, as it was unable to access cash funds seized by the Inland Revenue Authority of Singapore's (Iras), which were returned via a cheque some months later, after it emerged that no taxes were owing.

In the interim, YuuZoo's account was closed by its bank, which subsequently turned down its request to open a new account. Because of this, YuuZoo said, it was prevented from accessing the returned funds.

YuuZoo added that other Singapore-based banks also rejected its request to open an account.

The company said it has written to SGX to request that its share trading suspension be lifted so it can raise new funds that have been committed, and so shareholders can make trading decisions in the company.

YuuZoo was in the news over the weekend as well: It had vacated its Singapore flagship office in Science Park Road without settling its rent. The BT report said that several days before that, Mr Mohandas had resigned on account of unpaid salary.

Meanwhile, YuuZoo says it will carry on operating from other offices around the world. Attempts by BT to contact the company on Monday were unsuccessful.

YuuZoo's shares were first suspended in March last year. Its auditor at the time, RT LLP said a disclaimer had been issued to YuuZoo, in response to questions posed by SGX, because the auditor had been "unable to form an opinion due to limitation of scope".

YuuZoo added that SGX had refused to accept its response, and had called in the Commercial Affairs Department (CAD) to investigate the company.

"The CAD investigation, which has been going on for a full year, has not revealed any wrongdoing by the company. This is as expected, as the company since the beginning of the investigation has shown it has not committed any breach of the rules SGX asked CAD to investigate," the earlier of YuuZoo's two filings to SGX on Monday said.

When contacted by BT, a Singapore Exchange Regulation (SGX RegCo) spokesman said YuuZoo has been referred to the regulatory authorities including the CAD, and criminal investigations are ongoing.

Meanwhile, the company has not complied with a notice of compliance SGX issued on April 2 last year and a directive dated July 17 the year before.

In the April 2 notice of compliance, SGX had asked that YuuZoo instruct independent reviewer Ernst & Young Advisory (EY) to finalise its interim report and make known its initial findings to both the SGX and the company's audit company. The July 17, 2017 directive listed the areas that the independent review should cover, among other things.

SGX RegCo said in its statement to BT yesterday evening: "Pending these, the state of affairs at the company is unclear and the company's shares therefore remain suspended."

READ MORE: YuuZoo: A ghost trapped in suspension