KUALA LUMPUR (April 18): Caely Holdings Bhd announced on Monday (April 18) that the authorities have issued a freeze order on the bank accounts of the lingerie maker, which also said it is not aware of any wrongdoing that led to the authorities’ move.

"The board of directors [of] Caely wishes to announce that the authorities have issued a freeze order to freeze the operation of all the bank accounts of Caely group of companies. The group expects an impact on the financial and operational aspects on the Caely group of companies as a result of the said freeze order,” Caely said in a Bursa Malaysia filing.

Caely, however, did not specify which authorities issued the freeze order on its bank accounts.

According to Caely, its board of directors is unable to ascertain the full financial and operational impact of the freeze order at this juncture. 

"The board is not aware of any wrongdoing and will seek further clarification from the authorities on the issue. The company will make the necessary announcements to Bursa as and when there are further developments on the matter,” Caely said.

In a separate Bursa filing, Caely said its securities trade has been halted between 2:30pm and 3:30pm on Monday (April 18) in conjunction with the announcement on the authorities' freeze order on Caely’s bank accounts.

Prior to the securities trade halt, Caely's share price settled one sen or 2.17% higher at 47 sen, which values the company at about RM121.37 million based on its 258.24 million outstanding shares.

Upon trade resumption, Caely’s share price slumped 13% or six sen to its intraday low at 40 sen. The counter closed at 43 sen at 5pm.

Caely’s announcements on Monday followed a Bursa filing on April 7, 2022 and another on April 11, 2022 on the appointment of forensic auditor Virdos Lima Consultancy (M) Sdn Bhd to carry out an independent forensic audit on allegations of suspicious and irregular transactions at Caely’s wholly-owned subsidiary Caely (M) Sdn Bhd (CMSB).

On April 7, 2022, Caely said: "The board of directors of Caely wishes to announce that Virdos Lima Consultancy, forensic auditor has been appointed to carry out an independent forensic audit on allegations of suspicious and irregular transactions at CMSB.”

Caely, however, did not elaborate on the allegations of suspicious and irregular transactions at CMSB and provided more details on the independent forensic audit process.

As such, Bursa had on April 8, 2022 requested Caely to provide additional information on the company’s announcement on April 7, 2022.

According to Caely’s filing on April 11, 2022, Bursa’s April 8, 2022 request had included queries on circumstances leading to the forensic investigation, specific areas and scope of the forensic investigation to be undertaken, targeted date of completion of the investigation and financial and operational impact of the matters on the company.

On circumstances leading to the forensic investigation, Caely said: "One of the independent non-executive directors [of Caely] received an anonymous package containing documents raising concerns on several suspicious transactions involving CMSB.”

Caely said the specific areas and scope of the forensic investigation to be undertaken include obtaining and analysing evidence of alleged misconduct among current and former CMSB personnel involving CMSB’s suspicious transactions besides assessing the veracity of advances made by CMSB to determine if any irregular and inappropriate payments have been made.

"The targeted date of completion of the investigation [is] May 31, 2022. The company is unable to ascertain the financial and operational impact at this juncture until the forensic audit investigation is completed.

"The company shall update accordingly on the forensic audit investigation progress. Upon receipt of the forensic audit report, the company will take all necessary recourse available under the law upon taking further legal advice," Caely said.