FTEC’s former MD ordered to restitute RM2.5m in IPO funds

KUALA LUMPUR: Kenneth Vun @ Vun Yun Liun, former managing director and shareholder of FTEC Resources Bhd, has been ordered by the High Court to restitute to the company RM2.496 million, the amount of the company’s funds he had caused to be misused for his personal benefit.

The Securities Commission (SC) said in the landmark court ruling on Nov 11, Vun was also restrained from directly or indirectly managing FTEC funds and any of the group’s companies for two years after he had complied with the restitution order, unless with prior SC approval.

“This is the first time ever a company director has been ordered by the court to restitute company funds,” the SC said in a statement yesterday, calling the scoring of “another milestone in its relentless efforts to enhance corporate government”.

FTEC has been renamed Mangotone Group Bhd.

The SC said the judgment marked a major success for the regulator which had sued Kenneth Vun on Sept 26, 2007.

It said its investigation into the utilisation of the FTEC public issue proceeds showed that Vun had utilised a portion of the proceeds for his own benefit and personal use, constituting a breach of the conditions set by the SC when it approved its listing.

The SC said the civil action was brought under Section 100 of the Securities Industry Act 1983, which allows the court to make a restitution order upon application by the SC if it found a person to have contravened a relevant requirement.

“The SC views the judgment as a timely reminder to directors of listed companies that they must not treat company funds as their own and that they must at all times discharge their duties with honesty, integrity and accountability,” it said.