A missing sum of around $33 million belonging to Allied Technologies and held by law firm JLC Advisors in an escrow account is believed to have been paid out on the instructions of its managing partner Jeffrey Ong Su Aun, who has been uncontactable for days.
In a statement filed last night with the Singapore Stock Exchange, Catalist-listed Allied Technologies said it received a letter from JLC Advisors on Wednesday saying the funds of $33.4 million were purportedly paid out.
The law firm also said it has reasons to believe Mr Ong instructed the payout and it "might have been unauthorised".
The letter, which carried JLC's letterhead, stated that the law firm is investigating the matter and has lodged reports with the relevant authorities, which added that the amount stated as held by JLC on escrow is also incorrect and should be around $33.2 million.
Allied Tech said that despite repeated demands for repayment since March 23, including a letter of demand issued by its lawyers from Rajah & Tann on May 17, JLC has failed to release the balance escrow funds and has breached its obligations under the Escrow Agreement.
It added: "This is notwithstanding that at all material times, JLC's managing director, Mr Ong Su Aun, Jeffrey, had repeatedly represented to the company that the release of the escrow funds would be forthcoming, and had never once stated that the escrow funds were missing, that it had already been paid out or that JLC would not comply with the company's request to release the escrow funds in accordance with the escrow agreement."
Allied Tech said the authorised joint signatories for fund disbursements from the escrow account comprise its executive director Kenneth Low Si Ren and independent director Lim Jin Wei.
Both have individually confirmed to the Board that other than the company's March 23 demand letter, they have not given any instructions to JLC to release the balance sum in the account.
The precision-engineering firm said it has instructed its lawyers to respond to the JLC letter to clarify the situation.
It is also requiring the law firm to provide documentary evidence and a statement of accounts of the escrow funds as well as an update on Mr Ong's whereabouts.
Allied Tech has also asked its lawyers to make a police report, report the matter to the Law Society, and commence legal proceedings to protect its interests.
"The company is monitoring the situation closely and will take rigorous steps to protect its interests. The company will continue to provide further updates to shareholders on subsequent material developments," it added.
A police spokesman said investigations are ongoing.
The missing $33 million could be a record amount for lost monies in cases linked to lawyers, such as David Rasif, who is still at large after running away with $11.3 million of his clients' money in 2006.
Laws were passed in 2011 to prevent conveyancing lawyers from absconding with their clients' funds, ceasing the practice of banking money from property transactions into law firms' client accounts.
This article was first published in The Straits Times. Permission required for reproduction.