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I know when some of you read the title, the first thing come up in your mind is:

Who is Chong Ket Pen?

Chong Ket Pen or Dato’ Sri Chong Ket Pen was the Executive Director at Protasco Berhad (Protasco), owning 15.5% shares of the company. In order to maintain his position as the Group Marketing Director at Protasco, he approached Global Capital Limited Indonesia (GCL) in a deal to get Tey Por Yee as investor while in return nominating him as the Board member in Protasco.


Chong Ket Pen

Chong Ket Pen also assure GCL that Board of Protasco will agree to undertake a new business subsidiary in the Oil and Gas (O&G) sector. In response to it, Tey Por Yee proposed a deal to Protasco and that is how he searched and found PT Anglo Slavic Utama (PT ASU) with the contract.

PT ASU was The O&G new business subsidiary that Chong Ket Pen meant. He agreed to acquire a major share of PT ASU and appointing PT ASU as the company to secure the O&G contract. At that time, PT ASU was awarded license by Pertamina for a land in Aceh to be developed for oil production for a two-year period.

GCL and Chong Ket Pent – in his own personal capacity, came into the signing of the Investment Guarantee Agreement on November 3rd, 2012. Then on 26 November 2012, Tey por Yee became the largest shareholders of Protasco with 27.11% shares, nominee under the personal capacity of Chong Ket Pen.


Then what’s happened next?

On December 28th, 2012, Chong Ket Pen arranged for Protasco and PT ASU to enter into a Sales and Purchase Agreement (SPA), which was governed by an arbitration clause and stated: Protasco to acquire 76% of equity interest in PT Anglo Slavic Indonesia (PT ASI) for USD 55 million (Rp800 billion), from its parent company PT ASU. Chong Ket Pen has to complete the deal in six months, but he delayed the deal from six from months to 18 months, inducing PT ASU to accept a revised deal of merely a USD 22 million deal or 63% equity.

Kenny Chong Ther Nen, the son of Chong Ket Pen who was entrusted by his father to execute the logistics of the deal, colluded with PT ASU Former Director Tjoe Yudhis Gathrie to forge false documents, to make it look as if PT ASU has failed to comply to the terms of the SPA. Furthermore, Chong Ket Pen together with Tjoe Yudhis Gathrie also fabricated misleading allegations against PT ASU to put blame on PT ASU’s alleged failure, and therefore the SPA was terminated.

The SPA termination has caused PT ASU to have insufficient capital to proceed with the oil production in Aceh and experiencing major opportunity losses. Apart from that, Pertamina has also ended the award of PT ASU over the land in Aceh as it has passed the 2-year award period.

The Case

The Indonesia-based company is claiming USD 88 million from Chong Ket Pen over his act of contract breach, including loss of investment and future profits for the stake in Protasco Bhd; loss of margin to finance the acquisition of shares up to USD 18 million; liability of USD 55 million to PT ASU – as guarantor for Chong Ket Pen pursuant to the Investment Guarantee Agreement; and USD 15.5 million as payment for the profit guarantee under the Investment Guarantee Agreement.

Subsequently, it was discovered that Chong Ket Pen had made the proposal for the transaction of Protasco Bhd’s shares without disclosing to the Board that he has personal interest in obtaining control over the company, through the Investment Guarantee Agreement.


Following this discovery, Chong Ket Pen maneuvered by putting the blame on Global Capital Ltd’s investors, Tey Por Yee and Ooi Kok Aun, putting them under the limelight in 2014 on allegations of criminal breach of trust due to the non-disclosure of interest in a transaction involving USD 20.3 million. They, however, were granted a discharge not amounting to an acquittal by the sessions.

Global Capital Ltd came into the thought that Chong Ket Pen has failed to ensure that Protasco Bhd was profitable, with a profit before tax of USD 7.1 million and USD 8.3 million in the third and fourth year under the Investment Guarantee Agreement. Aside from that, a total of USD 26.2 million profit was also guaranteed over the four years.

In October 2018, GCL filed a lawsuit against Chong Ket Pen to AG Chambers for Rp1.28 trillion, in breach of contract to the Personal Guarantee Agreement, which Chong Ket Pen has signed with GCL on 3 November 2012.

PT ASU has filed a report to the Indonesian police on fraudulence committed by Chong Ket Pen and Tjoe Yudhis Gathrie, againist PT Anglo Slavic Utama (PT ASU).

I think Chong Ket Pen might face a lawsuit in Malaysia as Bursa Malaysia public information also revealed that Chong Ket Pen has been drawing unrealistic remunerations from Protasco Bhd at the peak of USD 576,000 in 2017 and USD 1 million in 2016 respectively, after he gained control over the company. This suggested that Chong Ket Pen entered into business transactions and decisions on operation, remuneration, payments of dividends and salaries for his own benefit at the expense and the best interests of the company.

Furthermore, it was also reported that Protasco Bhd had recently lost a huge contract, as its subsidiary HCM Engineering Sdn Bhd received a letter of termination from Turnpike Synergy Sdn Bhd (TSSB) due to delays in the project, suggesting a USD 622,000 earnings impact. Following this, CIMB IB Research has therefore maintained its “Reduce” rating on Protasco Bhd at MYR 20 cents with a lower target price of MYR17 cents (from MYR 30 cents). Weak job execution and poor contract visibility is likely to weigh on its shares price.

Lesson learned!

Chong Ket Pen: His Fraudulence’s Story

December 23, 2018

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