Two Company Directors Jailed 20 Days For Defying Mareva Injunction

KUALA LUMPUR, July 15 (Bernama) -- The High Court today sentenced two directors of an investment firm to 20 days in jail for contempt of court after they were found guilty of failing to comply with a Mareva injunction issued in a civil suit involving breach of contract.

Judicial Commissioner Yusrin Faidz Yusoff handed down the sentence against the directors of Alpha Capital (M) Bhd, Syed Mahadzir Fadaak Syed Jamil Fadaak, and his wife, Erna Elliyana Rosli, for defying the court orders dated Sept 5 and Nov 22 last year.

However, Yusrin allowed a stay of the execution of the jail sentence for two months from today, to give time for the couple to fully comply with the Mareva order issued on Sept 5, 2024.

"In the totality of the circumstances, the court is not persuaded that the fine would be sufficient for a just sanction.

"The great concealment of the material information, the failure to comply over an extended period and the strategic nature of the non-disclosure demand a stern response," said Yusrin in delivering his decision.

In addition to the jail sentence, the court also ordered the couple to pay a fine of RM10,000 each within seven days, failing which they would face an additional seven days in prison.

Last month, the court found Syed Mahadzir Fadaak and Erna Elliyana guilty of contempt for failure to adhere to the Mareva injunction filed by their investors in September last year.

Today's decision stemmed from an interlocutory application in a civil suit filed by the 64 investors against Alpha Capital for failing to pay monthly dividend returns, involving a collective sum of RM19,831,440.50. 

A Mareva injunction is a temporary order preventing the defendant from disposing of assets until a decision is made in the case between the plaintiff and defendant.

Earlier in court, both Syed Mahadzir Fadaak and Erna Elliyana apologised, claiming they had no intention to disrespect the court.

"We did not intend to be in contempt of court, we do not understand what was being requested (in the Mareva injunction).

"The audit is currently in progress, but we have only received a draft audit report because we are unable to make payments to the audit company as all our bank accounts have been frozen," said Syed Mahadzir Fadaak.

Lawyers Sachpreetraj Singh and Simran Kaur appeared for the 64 investors, while the couple was represented by lawyer Ganesh Magenthiran.

-- BERNAMA