Singapore: The State Court fined Li Baozhu, the sole director of Corp Nergy Pte Ltd, $6,500 for failing to exercise reasonable diligence in her duties under the Companies Act. Previously, on October 11, 2023, ACRA had canceled Li’s registration as a Registered Qualified Individual (RQI) and Corp Nergy’s registration as a Registered Filing Agent (RFA) for the same reasons.
RQIs and RFAs offer corporate secretarial services for businesses, including company incorporation, annual return filing, and other obligations under the Companies Act. With the cancellation of her RQI and RFA registrations, Li is barred from operating as a corporate service provider (CSP).
Li had incorporated three local companies by falsely declaring to ACRA that a certain local resident had consented to be a director of these companies. The Companies Act requires that all Singapore-registered companies have at least one local resident director.
Investigations revealed that Li relied on a third party to secure the individual’s consent, which was never given. Li did not verify the prescribed consent form or take any steps to confirm that the individual had agreed to be a director before proceeding with the incorporations.
ACRA views the misuse of identities for director appointments very seriously. Corporate service providers who breach their obligations, whether negligently or otherwise, risk regulatory sanctions, including the cancellation of their registrations. Directors of such providers may also face prosecution for failing to exercise reasonable diligence. The maximum penalty for this offense is a fine of up to $5,000 or imprisonment for up to 12 months.
Source: ACRA
