Fashion Valet Investment Agreements Barred Use of Funds for Dividends, Court Hears

The Sessions Court hearing the criminal breach of trust case involving Fashion Valet founders Datin Vivy Sofinas Yusof and Datuk Fadzarudin Shah Anuar was told that investment funds received by the company could not be used to pay dividends to shareholders. Corporate lawyer Anne Wong Wai Yee, a prosecution witness who helped draft the company’s shareholders’ agreement, testified that the agreement contained no provision allowing such payments. The couple are facing charges involving RM8 million in investment funds from Khazanah Nasional and Permodalan Nasional Berhad (PNB).

Witness Details Restrictions on How Khazanah and PNB Investments Could Be Spent

Wong said the agreement specified that the funds were intended for technology development, consumer acquisition, store and warehouse expansion, and product and brand acquisition. These allocations accounted for 30%, 30%, 20% and 20% respectively. She added that dividend declarations required approval from a majority of directors, including representatives appointed by two investment partners.

The founders are accused of authorising RM8 million in payments from Fashion Valet’s corporate account to 30 Maple Sdn Bhd without board approval in August 2018. Both have pleaded not guilty. Wong clarified that her role was limited to preparing and coordinating agreements, and she had no personal knowledge of the alleged fund transfers or dividend distribution. The trial is scheduled to resume on November 20.

A corporate lawyer told the Fashion Valet trial that investment agreements prohibited the use of funds for dividends without the required approvals.

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