SINGAPORE (Apr 3): YuuZoo Corporation has been informed by the Commercial Affairs Department (CAD) of investigations into a potential offence under Singapore's Securities and Futures Act.

In addition, YuuZoo was informed that Thomas Zilliacus, the company’s chairman, also received a notice from CAD relating to investigations into the same matter.

YuuZoo says it received a notice dated Monday from CAD requiring the e-commerce company to provide the white-collar crimes division of the Singapore Police Force access to certain documents or information relating to the company, its subsidiaries and associates from financial years 2013 to 2016 including all records and correspondences relating to franchises, franchising arrangements and the operating companies in which shareholdings interest were held.

Last night, Singapore Exchange Regulation (SGX RegCo) said it had reported YuuZoo to the "relevant authorities" for possible breaches of the Securities and Futures Act.

See: SGX reports YuuZoo to 'relevant authorities' for possible breach of Securities and Futures Act after issuing notice of compliance

This followed the issue of a second notice of compliance to the e-commerce company in less than a month.

In Monday's notice of compliance, SGX RegCo ordered independent auditors Ernst & Young Advisory (EY) to provide it with a copy of the executive summary of its initial findings on YuuZoo as soon as it is finalised. The findings in the interim report is also to be released immediately via SGXNet upon its receipt.

YuuZoo says CAD has not disclosed to the company any further details on the investigations but will cooperate fully with the CAD in its investigation and will make announcement as and when there are further significant developments with regard to the matter.

On July 2017, YuuZoo announced it was engaging an independent auditor to investigate claims of poor corporate governance in the e-commerce company.

See: Scrutinising YuuZoo’s deals

See also: Shares in YuuZoo down 1.4% at 6.9 cents after initiating plans to investigate BT claims

As directed by the exchange, the scope of the review was to include revenue recognition from franchise sales, receivables from YZ Group and RM Bidder LLC as well as impairment of intangible assets run relation to Etisalat and receivables from related parties.

According to SGX RegCo, auditor EY said in its draft report dated Feb 23 it was not given the necessary access to information and data required to perform the review. In addition, EY said the review was restricted by scope exclusions imposed by YuuZoo.

These actions "were inconsistent with the spirit of the independent review," said SGX RegCo.

SGX RegCo had issued YuuZoo with its first notice of compliance on Mar 5, asking the group to get its statutory auditors to vouch for the accuracy and reasonableness of some other numbers in its unaudited FY2017 income statement.

See: SGX hits YuuZoo with compliance notice to explain variance in numbers

YuuZoo was also asked to explain why certain metrics recently announced in its FY17 earnings fell short. The exchange had noted there were a number of errors in the announcement and had asked the company to make the relevant amendments and reproduce the revised announcement.

Trading of shares in YuuZoo were suspended since Mar 19 after the statutory auditors of YuuZoo informed the company and SGX that they are "unable to obtain sufficient appropriate audit evidence" to provide an opinion as required in the Mar 5 notice of compliance.

See: SGX slaps trading suspension on YuuZoo