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On 20 September 2024, five former and current directors of Raffles Education Corporation Limited (now known as Raffles Education Limited) (“REC”), a company listed on the SGX Mainboard, were charged for disclosure related offences under the Securities and Futures Act (Chapter 289, 2006 Revised Edition) (“SFA”).

Investigations revealed that REC’s subsidiaries, Raffles Iskandar Sdn Bhd and Raffles K12 Sdn Bhd, had not made repayment of credit facilities extended by Affin Bank Berhad (“Affin Bank”). As a result, between 3 February and 16 April 2021, Affin Bank sent REC and its two subsidiaries, Letters of Demand claiming that the subsidiaries had defaulted on payment and seeking immediate repayment of the entire outstanding credit facilities, which amounted to at least RM 407 million in total. 

Despite the Letters of Demand, no repayment was made. REC and its subsidiaries were further served Writs of Summon and Statements of Claim (collectively, “Writs”) dated 17 May 2021, which were filed in the High Court of Malaya at Kuala Lumpur, Malaysia.

Under Rule 703(1)(a) of the SGX Mainboard Rules, REC was allegedly required to announce the Letters of Demand and Writs when they were first received, which was information necessary to avoid the establishment of a false market in REC’s securities. However, REC did not do so, and only belatedly announced the Writs on 29 July 2021.

The five directors each face two charges under Section 331 and punishable under Section 204(1) of the SFA, for their roles in connection to REC’s alleged reckless non-disclosures of the Letters of Demand and the Writs. The details of the charges are as listed below:

If convicted of an offence under Section 331 and punishable under Section 204(1) of the SFA, each person faces imprisonment for a term which may extend to seven years, or a fine of up to S$250,000, or both, for each charge.