FRAUD AND WHISTLE BLOWING POLICY AND PROCEDURE (the “Policy”)

 

 

PURPOSE

 

mm2 Asia Ltd. (the “Company”), its subsidiaries and associated companies (together with the Company, the “Group”) does not tolerate any malpractice, impropriety, statutory non-compliance or wrongdoing by staff in the course of their work.  This Policy is established to facilitate the development of controls that will aid in the detection and prevention of fraud and other irregularities against the group. It is intended to provide a framework to promote responsible and secure fraud and whistle blowing without fear of adverse consequences. 

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The Group is committed to the highest possible standards of ethical, moral and legal business conduct and intends to promote consistent organisational behaviour by providing guidelines and assigning responsibilities for the development of controls and conduct of investigations.  In line with the Group’s commitment to open communication and good corporate governance, this policy aims to facilitate the development of controls that will aid in the detection and prevention of fraud and also provide a framework by which employees and external parties may raise concerns in confidence about wrongdoing, malpractice, possible irregularity, or fraudulent activity within the Group and offer reassurance that they will be protected from reprisals or victimisation for whistle blowing in good faith and without malice.

 

Management is responsible for the detection and prevention of fraud, misappropriations and other irregularities.  Fraud is defined as the intentional, false representation or concealment of a material fact for the purpose of inducing another to act upon it to his or her injury.  Each member of the Management team will be familiar with the types of improprieties that might occur within his or her area of responsibility and be alert for any indication of irregularity.

 

 

SCOPE

 

This Policy applies to all directors, officers, employees, including full-time, part-time and contract employees of the Group (“Internal Parties”) and all shareholders, consultants, vendors, contractors, outside agencies doing business with employees of such agencies and/or any other parties with a business relationship with the Group (“External Parties”), whether located in Singapore, Malaysia or elsewhere.

 

 

POLICY

 

This Policy is intended to cover concerns over irregularities, wrongdoing or malpractice within or by the Group (“Alleged Wrongful Act”), including, without limitation:-

 

• incorrect financial reporting;

• questionable accounting or auditing matters;

• unlawful acts;

• breach of a legal obligation;

• breach of or failure to implement or comply with any Group policy or Code of conduct;

• endangerment to the health and safety of any individual;

• damage the environment;

• professional or ethical malpractices;

• concealment wrongdoings or malpractices;

• breach of fundamental internal control;

• impropriety, corruption, act of fraud, theft, misappropriation and misuse of properties, assets, resources, funds, securities or supplies of the Group;

• action amount to improper conduct;

• abuse of power and authority;

• dishonest or fraudulent acts;

• impropriety in handling or reporting of money or financial transactions;

• profiteering as a result of insider knowledge of the Group’s activities;

• disclosure of confidential and proprietary information to outside parties;

• acceptance or the seeking of material value from contractors, vendors, or persons providing services/materials to the company. Exception: Gift less than $100 in value;

• destruction, removal, or inappropriate usage of records, furniture, fixtures and equipment;

• serious conflict of interest without disclosure;

• fraud against investors, or the making of fraudulent statements to the Singapore Exchange Securities Trading Limited, member of the investing public and regulatory authorities;

• acts to mislead, deceive, manipulate, coerce or fraudulently influence any internal or external accountant or auditor in connection with preparation, examination, audit or review of any financial statements or records of the Group;

• serious or improper matters which may cause financial or non-financial loss to the Group, or damage to the Group’s reputation;

• constitute violations of this Policy;

• are intended to conceal any of the above

 

 

SAFEGUARDS

           

Harassment or Victimisation

 

The Group prohibits discrimination, victimisation, retaliation or harassment of any kind against a whistleblower who submits a complaint or report in good faith.  Discrimination, victimisation, retaliation or harassment of the complainant in retaliation for raising concerns over any Alleged Wrongful Act will not be tolerated and appropriate steps will be taken to ensure the complainant suffers no detriment or retaliation as a result of raising concerns over Alleged Wrongful Act.

 

Victimisation includes termination of employment; demotion; suspension; written reprimand; retaliatory investigation; decision not to promote; receipt of an unwarranted performance rating; withholding of appropriate salary adjustments; elimination of the employees' position, absent an overall reduction in work force, reorganisation, or a decrease in or lack of sufficient funding, monies, or work load; or denial of awards, grants, leaves or benefits for which the employee is then eligible, or discrimination or threats of any form.

 

At the appropriate time, the party making the report/complaint may need to come forward as a witness. If an employee or outside party makes an allegation in good faith but it is not confirmed by the investigation, no action will be taken against him or her. If, however, an employee has made an allegation frivolously, maliciously or for personal gain, disciplinary action may be taken against him or her. Likewise, if investigations reveal that the outside party making the complaint had done so maliciously or for personal gain, appropriate action, including reporting the matter to the police, may be taken. The Policy is also not a route for taking up personal grievances. These should continue to be taken up directly with Division or Department heads.

 

 

 

Confidentiality

 

All information received will be treated as confidential.

 

The Policy is meant to protect genuine whistleblowers’ from any unfair treatment as a result of their report.  Every effort will be made to protect the complainant’s identity, if so requested, so long as is compatible with a proper investigation.

 

Exceptional circumstances under which the information provided by the whistleblower including the identity of the complainant could or would not be treated with strictest confidentiality include:-

 

(a) Where the Group is under a legal obligation to disclose information provided;

 

(b) Where the information is already in public domain;

 

(c) Where the information is given on a strictly confidential basis to legal or auditing professionals for the purpose of obtaining professional advice;

 

(d) Where the information is given to the Police or other authorities for criminal investigation.

 

In the event we are faced with a circumstance not covered by the above, and where the complainant’s identity is to be revealed, we will endeavour to discuss this with the complainant first.

 

Anonymous Allegations

 

This Policy encourages employees to put their names to allegations because appropriate follow-up questions and investigations may not be possible unless the source of the information is identified.  Concerns expressed anonymously will be investigated, but consideration will be given to:

 

• the seriousness of the issue raised;

• the credibility of the concern; and

• the likelihood of confirming the allegation from attributable sources.

 

Malicious Allegations

 

Employees who raise a concern in good faith, which is shown to be unsubstantiated by subsequent investigation, will not have action taken against them. However, an employee who makes an allegation maliciously, in bad faith or knowing it to be untrue or unfounded, may be subject to disciplinary action. Likewise, if investigations reveal that an External Party making the complaint had done so maliciously or for personal gain, appropriate action, including reporting the matter to the police, may be taken.

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REPORTING PROCEDURES

 

Authorisation

 

The Audit Committee and the Administrator as authorized by the Audit Committee will have:

 

• Free and unrestricted access to all Group companies’ records and premises, whether owned or rented.

 

• The authority to examine, copy and/or remove all or any portion of the contents of files, desks, cabinets and other storage facilities on the premises without prior knowledge or consent of any individual who might use or have custody of any such items or facilities when it is within the scope of their investigation.

 

Reporting

 

Notwithstanding this policy, if any employee is not satisfied with the action take, or if the employee feels unable to raise a concern within the Group, the employee may report to the relevant competent authorities.

 

Concerns over or reports of Alleged Wrong Acts should be reported in writing to:

 

The Non-Executive Chairman

 

By hand or by post to:

 

Six Battery Road #10-01,

Singapore 049909      

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However where for some reason it is inappropriate to report to the Administrator or where necessary, the complainant may report directly to the Chairman of the AC as follows:

 

Chairman of the Audit Committee

 

mm2 Asia Ltd.

 

By hand or by post to:

 

Six Battery Road #10-01,

Singapore 049909

 

OR

 

By email to the Audit Committee

 

Email address: auditcommittee@mm2asia.com

 

To ensure that complaints can be submitted confidentially` or anonymously, the complainant can address his complaint in a sealed envelope marked “Private and Strictly Confidential”. The envelope shall be forwarded unopened to the Audit Committee Chairman.

 

The Group also recognises that the complainant may wish to seek advice and be represented by the complainant’s trade union officer.

 

The Complainant should not:

 

• contact the suspected individual in an effort to determine facts or demand restitution.

 

• discuss the case, facts, suspicions, or allegations with anyone unless specifically asked to do so by the Administrator/Audit Committee.

 

• attempt to personally conduct investigations or interviews/interrogations

 

Timing

 

All reports should be made as soon as practicable to enable the Group to take action.

 

Evidence

A report should be sufficiently detailed, setting out the background and history of events and reasons for the concern so as to provide the necessary information to Chairman of the Audit Committee as to the nature of the Alleged Wrongful Act.  Although the employee is not expected to prove the truth of an allegation, the employee is encouraged to provide such evidence as to demonstrate that there are sufficient grounds for concern. If the complainant is not comfortable about writing in, the complainant can telephone or meet the appropriate officer in confidence at a time and location to be determined together.

 

How the Complaint will be Handled

 

The action taken will depend on the nature of the concern. Initial inquiries will be made to determine whether an investigation is appropriate, and the form that it should take. Some concerns may be resolved without the need for investigation.

 

The Group assures you that any concern raised on information provided will be investigated, but consideration will be given to these factors:

 

• Severity of the issue raised;

 

• Credibility of the concern or information;

 

• Likelihood of confirming the concern or information from attributable sources.

 

If investigation is necessary, the Audit Committee of the Company will direct an independent investigation to be conducted on the complaint received without regard to the suspected wrongdoer’s length of service, position/title, or relationship to the Group. 

 

Great care would be taken in the investigation of suspected improprieties or irregularities so as to avoid mistaken accusations or alerting suspected individuals that an investigation is under way. A report on that complaint, findings of investigation and a follow-up report on actions taken shall be submitted to the Board of Directors.

 

Report to Complainant

 

Subject to legal and investigative constraints, the complainant will be given the opportunity to receive follow-up notification on his/her concern within 2 weeks of the complaint:

 

• acknowledging that the concern was received;

• indicating how the matter will be dealt with;

• giving an estimate of the time that it will take for a final response;

• telling him/her whether initial inquiries have been made;

• information about the outcome of any investigations;

• notifying them of reason(s) should it be decided that no action is to be taken.

 

However in order to avoid damaging the reputations of persons suspected but subsequently found innocent of wrongdoing conduct and to protect the company from potential civil liability, investigation results may not be disclosed or discussed with anyone other than those who have a legitimate need to know.

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Further Information

The amount of contact between the complainant and the body investigating the concern will depend on the nature of the issue and the clarity of information provided.  Further information may be sought from the complainant.

 

Subject to legal constraints the complainant will receive information about the outcome of any investigations.

 

Monitoring of Investigation and Complaints

 

Upon receiving a complaint, the Administrator shall:

 

1. determine whether the matter falls within the scope of this Policy and whether an investigation is appropriate;

 

1. conducts an investigation, refer the matter to management for investigation or refer the matter to the AC for its investigation

 

The Administrator shall maintain a record of all complaints received together to the actions taken thereto and this report shall be presented to the AC at its meetings.

 

The Audit Committee shall review the report and directed further actions to be taken as it deems necessary.

 

Notwithstanding the above, where necessary and appropriate, the Administrator shall immediately provide such detailed information about the complaint to the Chairman of the AC.

 

The Audit Committee will with the assistance of the Administrator maintain a record of complaints raised under this policy, the actions taken and the outcomes (but in a form which does not endanger confidentiality and where applicable, protect identity of the complainant) and will report the same to the Board of Directors.

 

Decisions to prosecute or refer the examination results to the appropriate law enforcement and/or regulatory agencies for independent investigation may be made in conjunction with the legal counsel and management, where appropriate, and the Board shall have the final decisions on disposition of the case.

 

Decisions to terminate an individual may be made in conjunction with designated representatives from HR Department, the management and legal counsel, where appropriate, and the Board shall have the final decisions on disposition of the case.

 

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Dissemination of Policy

 

A copy of this Policy and any subsequent amendments or modification thereof, shall be made available by the administration department / HR department to all directors, officers, employees, including full-time, part-time and contract employees of the Group, through publication at the notice board/website of the Group companies or such other means as may be approved by AC.

 

Maintenance of the Policy

 

The Board, acting upon the recommendations of the Audit Committee, has the responsibility for ensuring the maintenance, regular review and updating of this policy. Revisions, amendments and alterations to this policy can only be implemented upon approval by the Audit Committee and the Board of Directors. Changes will be notified in writing to the employees when they occur.

 

 

 

                                               

Name: Tan Liang Pheng

CHAIRMAN OF THE BOARD