LOG FROM AN OLD DIARY - HARD TALK

Today in history - In 2020, I was deeply disappointed to uncover cases of significant misappropriation within business entities, where company funds were diverted for personal use not just by managers, but more painfully, by trusted directors and shareholders.

This often led to delayed or unpaid vendor payments (one of them was me) and staff salaries. Such conduct not only erodes trust and damages business relationships, but also exposes the company to blacklisting, prolonged legal disputes, winding-up proceedings, and, ultimately, potential business failure. It also causes unnecessary suffering to their own families as well as the families of staff, vendors, contractors, and subcontractors.

When directors use company funds for personal lifestyle expenses, the conduct may constitute Criminal Breach of Trust (CBT) under section 409 of the Penal Code, not merely poor governance. A company is a separate legal entity, and directors are fiduciaries entrusted with its assets; shareholding does not confer ownership of company money.

All payouts without proper board approval, valid remuneration structures, declared dividends, or legitimate reimbursement, directors may breach their statutory duties under sections 213 and 218 of the Companies Act 2016. Such dishonest breaches can escalate from civil liability to criminal prosecution and, in aggravated cases, may also trigger exposure under AMLA and corruption-related laws.

I commend the bravery of the staff ironically, the very person who had worked tirelessly to ensure the company’s funds flowed properly and maintained its credit facilities, took my advice and reported the matter to the authorities, ensuring appropriate action was taken. 

I wish this unsung hero well, wherever the person is. Sometimes, it’s alright to “lose” when it means doing the right thing.

This experience serves as a strict reminder to me to always properly screen any company even the very people I intend to work with. Accountability exists and when conscience fails, the law does not.

Being a person who share the responsibility in the company now, I always remind myself constantly especially after prayers - no matter how difficult the situation, I will never take money that is tainted or dishonestly gained.

Those who have worked with me know that after that difficult period, I always made it a point to pay staff their final salaries and personally apologize for having to close the business. 

Today, I am deeply touched many of them have told me they would leave their jobs to come and work with me again.