What are the consequences of making a false declaration?
Case Background
- The Kuantan Magistrates' Court heard a company law case
- A director was charged for making a false declaration
- Regarding a director's resignation in a statutory document submitted to SSM
Relevant Law
- The charge was brought under Section 591 of the Companies Act 2016
- For making a false or misleading statement in a statutory document
Possible Penalties
- Upon conviction
- The director may face:
- Up to 10 years' imprisonment
- A fine of up to RM3,000,000
- Or both
Key Lessons from the Case
1. Directors and Officers Cannot Avoid Responsibility
- Even if they are not the person submitting the document
- They may still be held liable if they knew of or allowed the false declaration
2. Company Secretaries Must Exercise Due Care
- Company secretaries are responsible for submitting and certifying statutory documents
- They must ensure that all information is true, accurate, and complete
3. False Declarations Come at a High Cost
- They can result in serious legal consequences
- And may severely damage a company's credibility, reputation, and public trust
Summary
- All statutory documents must be truthful and accurate
- Directors and company secretaries should always fulfil their compliance responsibilities
- Integrity and compliance are the foundation of good corporate governance