Singapore
Data Register fined S$200,000 for flouting Companies Act
The company sent out 139,833 business letters seeking information from companies in late 2013, and gave the impression that it was linked to ACRA.
By Vanessa Paige Chelvan
03 Jun 2016 05:27PM
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SINGAPORE: Business services firm Data Register was fined S$200,000 on Friday (Jun 3) for failing to include its company name and registration number on 139,833 letters sent out in late 2013.
These letters were “engineered” to create the impression that they were from the Accounting and Corporate Regulatory Authority (ACRA), and caused 21,780 recipients to unwittingly subscribe to Data Register for an annual fee of S$490, the court heard.
Data Register - previously known as Company Register - states on its website that it aims to “link companies and businesses within the region”. It pleaded guilty earlier this year to 500 charges under the Companies Act, with another 604 taken into consideration during sentencing.
The firm had admitted to sending thousands of letters to businesses, asking them to verify details with it or risk being deleted from the “Singaporean Company Register” database in October and November 2013.
This led to widespread confusion, and ACRA received an “unprecedented” number of complaints, the authority said.
Because the letters in question bore letterheads stating “Singapore Company Register” and other similarities to correspondence issued by ACRA and other Government agencies, many business were duped.
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In court on Friday, the District Judge agreed the letters would have confused businesses, saying the letters were “plainly calculated to give a misleading impression” that they had “originated from a Government agency” – ACRA.
Though ACRA had begun investigations into Data Register’s practices, the latter still continued to send out letters in 2014 to solicit new subscriptions and demand payment from existing subscribers.
“These are hardly the acts of a company … that is remorseful or had intended to act in good faith”, chief executive of ACRA Kenneth Yap told the court on Friday.
Mr Yap added this was an “open-and-shut case in which there is overwhelming evidence”, but carried on for years. Data Register finally elected to plead guilty on the eve of the trial, he said.
In February 2016, after Data Register had been charged with 1,104 counts, the firm wrote to “eligible subscribers” – those who had not yet used the firm’s services – to offer them the opportunity to terminate their subscription and a refund of subscription fees. Eligible subscribers had a 10-day window to take up the offer.
Mr Yap, who personally prosecuted the matter, urged the court on Friday to impose a fine of S$400 on each of the 500 proceeded charges, amounting to a total of S$200,000.
Mr Yap said Data Register’s “unsolicited business letters” containing “vague and threatening contents” had affected ACRA’s public reputation and standing, as Data Register’s letters “gave rise to a reasonable inference that the letter was issued by ACRA”.
Mr Yap also pointed out that Data Register’s actions had led to ACRA having to expend substantial resources to deal with thousands of enquiries and complaints, and that a large number of businesses had been harmed and inconvenienced.
The requirement to state a company’s name and registration number in business correspondences is mandated under section 144 of the Companies Act. ACRA said this is to ensure that members of the public are aware of the identity of the corporate entity that issued the letter in question, and to prevent entities from impersonating or purporting to represent another company or Government agency.
A check on Data Register’s website on Friday showed the firm had
included an “important note”, stating they are “not the Government agency (ACRA) … and have no relation to (ACRA) whatsoever”.
The firm could have been fined up to S$1,000 per charge.
Source: CNA/ly
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