honestbee issued demands for breach of fiduciary duties against ex-CEO and director

Sng and Wong made property deals and companies that the firm paid for.

Troubled delivery business honestbee has sought legal advice and taken action against their ex-CEO Joel Sng and ex-director Jeffrey Wong through letters of demands for breach of fiduciary duties, an announcement revealed.

“Since their departures, honestbee has been investigating various transactions entered into by the company whilst Sng was CEO and Wong was Director of honestbee. honestbee has since discovered numerous irregularities that call for further investigation,” the firm said in a statement.

honestbee cited a case where Sng purchased a house in Japan last 2015 under his name and the company amounting to about $1.59m (US$1.1m), on top of other running costs of the property. It was noted that it had “no apparent real benefit or commercial advantage for honestbee”.

In February 2018, Sng also attempted “belatedly” to regularise the purchase of the Niseko platform by entering into an agreement with honestbee where Sng indicated that in December 2015, he had been appointed to provide commissionaire activities by acting on behalf of the platform.The purchase was not disclosed to the then-Board or shareholders of honestbee until September 2018.

Earlier, both Sng and Wong started a company called The Cub in May 2013 with both individuals owning 70% and 30% respectively. In October 2017, The Cub entered into a tenancy agreement with LHN Space Resources, the landlord of habitat by honestbee, for the site at 34 Boon Leat Terrace and the unit above habitat by honestbee.

honestbee paid for all security deposits, transaction costs (including stamp duty), tenancy agreement, monthly rent and expenses totalling approximately $51,000 a month from October 2017 to October 2018, and its architectural design fees for the premises on behalf of The Cub.

Prior to September 2018, Sng did not disclose the Cub payment arrangement to the then-board or shareholders of honestbee.

“Since October 2017, the tenanted premises were left empty and in fact were of no real use to honestbee. There was no real benefit or commercial advantage for the company to make payment of the tenancy transaction expenses and rent, as well as any other fees or payments for the premises, on behalf of The Cub,” honestbee stated.

Another case they cited is the e-wallet solution, PayNow, that Sng incorporated in January 2017. honestbee entered into a share subscription agreement and a partnership deal with the said firm, where the delivery platform subscribed for 20% of the ordinary shares in PayNow, with Sng owning the remaining 80% of the ordinary shares.

honestbee paid $1m for the ‘share subscription’, paying further sums between August 2017 and February 2018 totalling approximately $6.4m for the purported purchase of Sng’s shares in PayNow. These payments were said to be made at Sng’s instructions, which he did not disclose to the board or shareholders.

The firm later found out that PayNow did not have a minimum viable product that was ready to launch at that time, it was only in rudimentary stage. honestbee further paid approximately $7.4m in total to subscribe and acquire Sng’s 100% shareholding of PayNow.

It is believed that the above transactions have caused loss and damage to the Company, and “have no doubt contributed to the financial difficulties of honestbee,” honestbee said. “The company has not received any substantive response from either Sng or Wong. honestbee intends to and will raise and pursue any other questionable transactions that may come to light in the course of its investigations.”