Dealership fails to deliver cars; ex-employee charged with misappropriating over $400k

Several parallel importers have been flagged by the Consumers Association of Singapore (Case) in recent months.
PHOTO: Wanbao

After two months of delays and frustration with troubled car dealer Royal Automotive, Ms Jenny Tay was promised a refund of more than $47,000. But to her dismay, the cheque bounced when she tried to deposit it on Monday.

Despite several calls and messages, she could not reach the boss of Royal Automotive.

To make matters worse, Chinese daily Lianhe Wanbao reported yesterday that the lease of Royal Automotive's Woodlands showroom will end this month.

When contacted by The New Paper yesterday, director of Royal Automotive, Mr Syed Khairil, 27, admitted it was facing cashflow issues, but insisted it was still in operation and was looking for a new location for its showroom.

WORKING CLOSELY

On the issue of the bounced cheque, he said it is working closely with the affected customer to resolve her issue as soon as it can.

Royal Automotive's financial problems come even as its former employee, Chua Peng Jun, was charged in court today with criminal breach of trust.

TNP understands that at least 20 victims have made police reports against Royal Automotive.

Similarly, the Consumers Association of Singapore (Case) has received 20 complaints about the car dealer since July.

Executive director of Case, Mr Seah Seng Choon, said the number of complaints against parallel importers is not large, but it has seen more complaints recently.

Last week, Case told The Straits Times that it was considering whether it should flag Royal Automotive because of the number of complaints.

Mr Syed said he will be meeting over 40 customers this week to explain the situation to them.

He said: "We will try our best to help affected parties with the delivery of their cars, but we must operate in line with our legal obligations.

"We continue to be contactable at our office or through Facebook."

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According to checks with the Accounting and Corporate Regulatory Authority (Acra), Royal Automotive was registered last November.

Two affected customers approached by TNP said they were attracted to Royal Automotive because of its lower prices, which are about $10,000 below the market rate.

Ms Tay, who declined to reveal her occupation, had booked a Honda Vezel in May.

She was supposed to get the car by the end of August after trading in her old car.

She said: "I was initially sceptical so I asked them to show me their other invoices. They had proof that they were able to deliver the cars.

"It is a lesson learnt. I will make sure that the car is in the showroom before putting down any money."

A customer, who wanted to be known only as Melvin, 40, also admitted that he should have done more research.

He scrapped his old car in anticipation of a new Honda Vezel by mid-October.

He said: "I work in sales so I really need a car. But I already paid a deposit of $20,000 and I have no choice but to hope for the best."

More dealers flagged recently

Several parallel importers have been flagged by the Consumers Association of Singapore (Case) in recent months.

Case's latest alert on Nov 4 was on TLC Cars, located at Turf Club Road, which received eight complaints.

Most customers complained that they had made partial or full payment for the purchase of a car, but did not receive the car on the promised delivery date.

Consumers have also told Case that the business owner is uncontactable and that the premises of the business had been vacated.

On Oct 31, Case issued an alert about De Auto Boutique and Exodus Global, which received 41 complaints from January to last month.

The complaints were mainly about consumers paying a deposit (from about $5,000 to $30,000) to the company to secure the deal, but failing to receive the car on the promised delivery date.

SMALL NUMBER

Nonetheless, the number of complaints against parallel importers is small compared to the number of complaints about the motorcar industry.

In 2015, the industry had 2,907 complaints, the highest among all the industries, said Mr Seah Seng Choon, executive director of Case.

The majority of the complaints were about defective goods.

Mr Seah said: "Although the number of complaints against parallel importers is not large, we do see more recent complaints of such companies collecting deposits from consumers and either failing to honour the agreement or closing down and leaving consumers in the lurch."

Mr Seah advised consumers to negotiate to pay as low a deposit as possible when purchasing a car and urged them to consider patronising CaseTrust-SVTA accredited motoring companies.

These businesses are committed to fair trading and have taken up a $50,000 insurance bond in the event of unresolved disputes.

Read also: Another car firm leaves buyers high and dry​

Car salesman charged with criminal breach of trust

A former sales representative of local parallel importer Royal Automotive was charged yesterday with misappropriating more than $400,000.

Malaysian Chua Peng Jun, 23, allegedly committed criminal breach of trust of the amount belonging to the importer between May 17 and Nov 9, reported The Straits Times Online.

He is believed to have collected sales deposits totalling $414,564 from customers and issued fake invoices to them.

A police statement on Monday said they had received several reports against a local car dealership company.

According to the reports, the dealer had failed to deliver automobiles to customers after receiving the sales deposits.

Ang Mo Kio police arrested the accused on Sunday. He will appear in court again on Nov 22.

If convicted, he can be jailed for up to 15 years and fined for criminal breach of trust as a servant.

Last Friday, Royal Automotive announced on Facebook that Chua was no longer working for it as a salesman.

linheng@sph.com.sg

This article was first published on November 16, 2016. Get The New Paper for more stories.