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Mar 12, 2014 (LBO) - Sri Lanka's Securities and Exchange Commission has asked Touchwood Investments, a forestry company, not to strip fixed assets or destroy data shortly after trading in its shares were suspended for not filing quarterly accounts.
Touchwood was directed to "desist from acquiring, transferring, disposing, pledging, hiring, mortgaging, leasing, creating a charge over or otherwise alienating any non-current assets," in a directive dated March 11, made public today.
It was also directed to "desist in any manner from destroying, concealing, altering, removing, amending, or cause to be destroyed, concealed, altered, amended or removed any information that is in the records or books" of the firm.
Touchwood ran a forestry scheme involving trees such as mahogany and also gained a quotation on the Colombo Stock Exchange and sold shares to stock investors.
Recently investors sued to liquidate the firm to get their money back.
SEC said it was issuing the directive "considering the risk posed to investors in the light of the seriousness of the offences and the circumstances of the winding up application."
SEC officials had earlier said that police criminal investigators were also called in following asset transfers.
SEC said it had also served "notice of action" on a number of existing and other directors.
Controversies over Touchwood's forestry investments schemes and its accounting practices have raged for several years.
Analysts have warned about the promises of fixed returns made by forestry companies for over a decade (Green Blues) .
Its accounts and asset valuation methods were first probed by first probed by Sri Lanka's accounting watchdog in 2006 which ruled in 2007 that accounting methods were "clearly unreliable." The matter ended up in a court battle.
Later in the year its then auditors disclaimed the accounts.
Investors have lost money in forestry companies in many countries including India which brought in rules such as ratings, a trustee and minimum capital and wound up those that did not fall in line.
Touchwood was directed to "desist from acquiring, transferring, disposing, pledging, hiring, mortgaging, leasing, creating a charge over or otherwise alienating any non-current assets," in a directive dated March 11, made public today.
It was also directed to "desist in any manner from destroying, concealing, altering, removing, amending, or cause to be destroyed, concealed, altered, amended or removed any information that is in the records or books" of the firm.
Touchwood ran a forestry scheme involving trees such as mahogany and also gained a quotation on the Colombo Stock Exchange and sold shares to stock investors.
Recently investors sued to liquidate the firm to get their money back.
SEC said it was issuing the directive "considering the risk posed to investors in the light of the seriousness of the offences and the circumstances of the winding up application."
SEC officials had earlier said that police criminal investigators were also called in following asset transfers.
SEC said it had also served "notice of action" on a number of existing and other directors.
Controversies over Touchwood's forestry investments schemes and its accounting practices have raged for several years.
Analysts have warned about the promises of fixed returns made by forestry companies for over a decade (Green Blues) .
Its accounts and asset valuation methods were first probed by first probed by Sri Lanka's accounting watchdog in 2006 which ruled in 2007 that accounting methods were "clearly unreliable." The matter ended up in a court battle.
Later in the year its then auditors disclaimed the accounts.
Investors have lost money in forestry companies in many countries including India which brought in rules such as ratings, a trustee and minimum capital and wound up those that did not fall in line.
