This article first appeared in The Edge Malaysia Weekly on May 29, 2017 - June 4, 2017

LOSS-making marble and granite manufacturer Stone Master Corp Bhd’s extraordinary general meeting on May 30 to remove two directors may expose alleged irregularities in the company.

Stone Master executive director and vice-president Datuk Karen Lee Fong Yin requisitioned the EGM to remove group managing director Datuk Koh Mui Tee and executive director Datuk Lee Hwa Cheng, with immediate effect.

Resolutions will also be tabled at the EGM to appoint eight directors, namely Ma Jee Choong, Datuk Abdul Aziz Mohamed, Low Eng Tack, Datuk Ng Boon Siong, Tan Wee Hock, Ananda Kumar Ramayah, Foo Chooi Wai and Leong Kam Soon.

Fong Yin is the single largest shareholder with a 22.29% stake in Stone Master. She is believed to be in the same camp as Datuk Yii Ching Siew, the second largest shareholder with a 9.45% stake, who relinquished his position as executive director and president in March. The duo surfaced as substantial shareholders in August 2014.

When contacted, Koh, who does not own a single share in Stone Master, says he intends to “stay on and expose all the wrongdoings” in the company, which seems to be facing some corporate governance issues.

“They [Yii and Fong Yin] are going to [oust me from the board]. But I want to stay on and continue to fight for justice. If I resign, or if I am going to be removed, all these malpractices and power plays will be buried,” he tells The Edge.

Koh was first appointed as independent director of Stone Master in August 2014, before he was re-designated as executive director four months later. He was then further re-designated managing director in July 2015.

Koh reveals that Stone Master received letters early this month from minority shareholders who claimed they were told by anonymous sources that there have been unlawful activities and ­wrongdoings in the company.

“[These letters] have compelled the company to reply, which we did, and also to proceed with investigation and legal action,” he says, adding that the minority shareholders wanted the public to be informed of this matter for good reasons.

Letters sighted by The Edge ­indicate that Yii and Fong Yin had allegedly misappropriated RM167,623 and RM125,345 collectively for their own salary advances from February to August 2016.

“The two of them said they need money, and they promised to pay back the company as soon as possible, but this didn’t happen”, Koh says, adding that he was in no position to stop the duo, or he would have been fired “a long time ago”.

Yii had also allegedly misappropriated RM60,000, RM42,000 and RM80,000 for his travelling ­expenses, allowance and office rental advances for the same period.

“Yii authorised the payment vouchers, and signed on the cheque as one of the signatories. Unfortunately, in my position, I can be removed anytime if I don’t comply. So, I was forced to sign the cheque and issue the payment to them,” Koh says.

Letters from the minority shareholders also reveal that Yii had allegedly created a false valuation report for Stone Master’s office premises to allow him to charge the company “unreasonable” rent.

Stone Master is located at the third floor of Medan Klang Lama 28, Kuala Lumpur.

“The fourth floor was used by Yii’s own businesses, but not for Stone Master’s. Using his influence, he made the company rent the floor from him at a higher-than-usual market rent,” Koh says.

Likewise, he says, the rent for the third floor had also been grossly inflated.

Koh says Yii has two active businesses, namely Chinese magazine The Entrepreneur and healthy fibre drinks ToxOut.

“Most of the time, Yii is not doing anything for Stone Master; in fact, there is no need for the use of the fourth floor,” he says.

It is learnt that Koh and Stone Master chief financial official Yong Tiong Fatt have made police reports about the alleged malpractices.

Copies of the minority shareholders’ letters were sent to the Minority Shareholder Watchdog Group, Securities Commission ­Malaysia, Bursa Malaysia, Bank Negara Malaysia, the Malaysian Anti-Corruption Commission, the Commercial Crime Investigation Department of Royal Malaysian Police and the Attorney-General’s Chambers.

At press time, Fong Yin could not be reached for comment.

Last December, Stone Master was classified as a Practice Note 17 (PN 17) issuer, after its shareholders’ equity dropped below 50% of its issued and paid-up capital.

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