KUALA LUMPUR (Jan 3): Serba Dinamik Holdings Bhd wanted to stop the disclosure of the factual findings update (FFU) on its special independent review (SIR) partly because it referred to documents seized by the Securities Commission during its raid on the company, said Bursa Malaysia Securities Bhd in its civil suit against the oil and gas engineering company.

In the written submission filed by Bursa Securities’ counsel Datuk Loh Siew Cheang, the plaintiff disputed Serba Dinamik’s claim that the FFU is hearsay documentary evidence which is not admissible.

Further, the counsel also disputed the assertion that the FFU is unverified and therefore cannot be disclosable material information, saying the defendant is “engaging in a game of words”.

“As a matter of fact, the damning documents in the FFU in the form of exhibits/appendices are the defendant’s documents seized by the Securities Commission during a raid that lasted three days and the SIR refers to those documents.

“In substance, it is these documents the Defendant (Serba Dinamik) wants to keep as a mystery and secret,” Loh said in the submission.

The lawyer added that “Where the authenticity of recorded transactions cannot be verified, it is indisputably material information requiring immediate public disclosure”.

In its suit, Bursa Securities is seeking a court order to force Serba Dinamik to disclose the FFU of the SIR dated Sept 30, 2021, which was conducted by Ernst & Young Consulting Sdn Bhd (EY Consulting) on its financial accounts.

The legal action was taken due to Serba Dinamik's "failure to comply" with the stock exchange's directive on Oct 22 for the disclosure.

In the submission, Loh also said that “Bursa in its capacity as regulator is not asserting or seeking to establish the truth of the statements”.

“Bursa in its capacity as regulator is not seeking, like a private litigant in a civil dispute, for orders to set aside the transactions, or declare the transactions invalid.

"Prior to the issue of the Disclosure Directive, Bursa took actions under the Main Market Listing Requirement to monitor and secure compliance with the MMLR by the Defendant," Loh said.

He added that the MMLR, in paragraph 2.23, empowers Bursa to issue the Disclosure Directive.

"Bursa’s case is predicated upon the Defendant’s refusal to comply with the Disclosure Directive issued to it. This is the Defendant’s contravention," Loh added. 

Hearing for the suit continues before judicial commissioner Wan Muhammad Amin Wan Yahya in the High Court on Jan 11. 

Serba Dinamik also has a suit against Bursa Securities to nullify the SIR, arguing that the directives by the stock exchange to appoint EY Consulting for the SIR was in excess of its power, among others.

The issue in Serba Dinamik first came up when its external auditor KPMG raised certain issues involving its financials for the 12 months ended Dec 31, 2020. The matter snowballed into litigation by the company against the auditor, prompting regulators to step in, including a raid by the SC on the company's office.

Shares of Serba Dinamik have been suspended from trading since Oct 22, after it refused to disclose the FFU. The group's shares last settled at 35 sen, giving it a market capitalisation of RM1.3 billion.