NKF considers civil lawsuit action against former directors being explored
Wednesday • April 12, 2006
Val Chua
Assistant News Editor
val@newstoday.com.sg
CRIMINAL action against the former management team of the National Kidney Foundation (NKF) may still be a question mark, but a separate civil suit is apparently in the works.
The recovering charity — which was embroiled in a saga that forced new regulations on the industry — appointed law firm Allen & Gledhill (A&G) last week to look into possible legal recourse against the NKF's former top hats, according to a report in The Business Times.
The top law firm was appointed after the NKF sought proposals from five firms, said Mr Gerard Ee, the chairman of NKF's new board.
The move comes about four months after independent auditors KPMG issued a damning report on ex-CEO T T Durai and the former board of directors — led by then-chairman Richard Yong — for their roles in Singapore's biggest charity scandal.
A "sizeable" A&G team — led by Senior Counsel K Shanmugam — will use the KPMG report as a basis to pursue possible legal action against the individuals, said Mr Ee.
"They will go through all the documents — not just the KMPG report — and give their advice on who are the individuals and what is the scope.
"It's still open-ended at this stage. What we are enthusiastic about, the lawyers may say 'no point'. But they may see something that we, as laymen, don't," he told Today.
Lawyers have previously said it would be hard for the authorities to pin down criminal wrongdoing based on the KPMG report, although it had unveiled outrageous excesses of the old Durai administration. Criminal investigations by the Commercial Affairs Department are ongoing.
A civil suit initiated by the new board may be plausible, however, based on management lapses and a lack of transparency in the way contracts were awarded, said legal experts.
In particular, two botched contracts — worth a total of $7.5 million — were under scrutiny. Forte Systems and Protonweb — owned by Mr Durai's friend Pharis Aboobacker — had received payments from the NKF even though they had failed to deliver some services. Mr Ee had said in the past that the NKF would pursue legal means to recover these monies.
Yesterday, he hinted that the civil suit — if any — may involve more than just the two botched contracts.
"The lawyers will look at everything. It's not limited to these two contracts," he said, adding that some recommendations by A&G will come up in the next few weeks, in "May or June".
Taking pains to de-link the criminal investigations from the possible civil lawsuit, he also said that the board was not looking into criminal matters, but rather management issues: "The board only looks at civil actions, the criminal part is dealt with by the authorities."
Val Chua
Assistant News Editor
val@newstoday.com.sg
CRIMINAL action against the former management team of the National Kidney Foundation (NKF) may still be a question mark, but a separate civil suit is apparently in the works.
The recovering charity — which was embroiled in a saga that forced new regulations on the industry — appointed law firm Allen & Gledhill (A&G) last week to look into possible legal recourse against the NKF's former top hats, according to a report in The Business Times.
The top law firm was appointed after the NKF sought proposals from five firms, said Mr Gerard Ee, the chairman of NKF's new board.
The move comes about four months after independent auditors KPMG issued a damning report on ex-CEO T T Durai and the former board of directors — led by then-chairman Richard Yong — for their roles in Singapore's biggest charity scandal.
A "sizeable" A&G team — led by Senior Counsel K Shanmugam — will use the KPMG report as a basis to pursue possible legal action against the individuals, said Mr Ee.
"They will go through all the documents — not just the KMPG report — and give their advice on who are the individuals and what is the scope.
"It's still open-ended at this stage. What we are enthusiastic about, the lawyers may say 'no point'. But they may see something that we, as laymen, don't," he told Today.
Lawyers have previously said it would be hard for the authorities to pin down criminal wrongdoing based on the KPMG report, although it had unveiled outrageous excesses of the old Durai administration. Criminal investigations by the Commercial Affairs Department are ongoing.
A civil suit initiated by the new board may be plausible, however, based on management lapses and a lack of transparency in the way contracts were awarded, said legal experts.
In particular, two botched contracts — worth a total of $7.5 million — were under scrutiny. Forte Systems and Protonweb — owned by Mr Durai's friend Pharis Aboobacker — had received payments from the NKF even though they had failed to deliver some services. Mr Ee had said in the past that the NKF would pursue legal means to recover these monies.
Yesterday, he hinted that the civil suit — if any — may involve more than just the two botched contracts.
"The lawyers will look at everything. It's not limited to these two contracts," he said, adding that some recommendations by A&G will come up in the next few weeks, in "May or June".
Taking pains to de-link the criminal investigations from the possible civil lawsuit, he also said that the board was not looking into criminal matters, but rather management issues: "The board only looks at civil actions, the criminal part is dealt with by the authorities."
posted by khimsiu at 2:35 PM
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