21 May 2020
The Securities and Futures Commission (SFC) has presented a petition to the Court of First Instance to wind up Combest Holdings Limited (Combest) and to disqualify the company’s executive directors, Mr Liu Tin Lap and Mr Lee Man To, and a suspected shadow director, Mr Ng Kwok Fai under the Securities and Future Ordinance to protect the interest of Combest’s shareholders, creditors and the investing public.
The SFC has also applied to the Court of First Instance for the appointment of provisional liquidators over Combest and the application will be heard on 30 and 31 July 2020 while the first hearing of the SFC’s petition will be on 12 August 2020.
The SFC’s investigation found evidence to suggest that Ng, Liu and Lee caused Combest and one of its subsidiaries to enter into two overpriced acquisitions.
The SFC also alleges that Combest overstated its revenue by more than 84% to 99% during various accounting periods between 2016 and 2019 by including in its financial statements revenue generated by the artificial and/or fictitious businesses acquired in the above-mentioned overpriced acquisitions, which are currently still the main businesses of the company. The overpriced acquisitions and the artificial and/or fictitious businesses have caused losses of more than $293 million to Combest.