Court of Appeal Upholds RM84.64 Million Fraud Judgment Against Former Protasco Directors

In brief: On 7 July 2026, the Court of Appeal affirmed one of the larger directors'-liability judgments in recent Malaysian corporate history. A three-member bench chaired by Justice P Ravinthran dismissed the appeals of former Protasco Bhd directors Tey Por Yee and Ooi Kock Aun, upholding the High Court's order that they pay the construction and road-maintenance group RM84.64 million in damages over a fraudulent US$27 million investment in an Indonesian oil and gas venture.

This article concerns Malaysian company law and civil litigation.

What was the case about?

The background stretches back more than a decade. Protasco had paid US$27 million towards an investment involving Indonesian entities, including PT Anglo Slavic Utama and PT Anglo Slavic Indonesia. The High Court found that Tey and Ooi secretly controlled those companies and several related entities, failed to disclose their interests while sitting on Protasco's board, and caused the money Protasco paid to be diverted through companies under their control. In short, they were on both sides of the deal without telling anyone. Having awarded the company RM84.6 million with interest in 2023, the High Court held that the pair had breached their duties as directors and fraudulently induced Protasco into the investment — and the Court of Appeal found no basis to disturb any of that.

Why does it matter for company directors?

For company law, the decision is a strong reaffirmation of the core fiduciary duties every director owes: to avoid conflicts of interest, to disclose any personal stake in transactions the company enters into, and not to profit secretly at the company's expense. A fiduciary duty simply means the director must put the company's interests ahead of his own. Where a director conceals beneficial ownership — meaning he really owns or controls something even though his name is not on the papers — and steers company money towards entities he controls, the courts will trace the wrongdoing and can impose personal liability for the full loss.

What does it mean for litigators?

The judgment matters for litigators too. Fraud is notoriously hard to prove: the standard of proof is exacting and the evidence is usually buried in layers of corporate structures across borders. Protasco's success, sustained now at two levels of court, shows that Malaysian courts are willing to piece together complex cross-border shareholding trails and draw firm conclusions about concealment. It is a helpful precedent for boards and shareholders considering recovery actions against errant directors, and a sobering one for anyone advising on nominee or undisclosed-interest arrangements.

What about enforcement?

There is also an enforcement angle worth remembering: Protasco has previously pursued bankruptcy proceedings against the two men, so the battle may now shift from establishing liability to actually collecting the judgment sum — which, with interest and costs, is well north of the headline figure.

What happens next?

The questions to watch are whether Tey and Ooi attempt a final leave application to the Federal Court, and how the enforcement and bankruptcy chapters unfold. For corporate clients, the case is a timely study for board training on the disclosure of interests under the Companies Act 2016.

Frequently asked questions

What fiduciary duties does a company director owe?

A director must act in the company's best interests, avoid conflicts of interest, disclose any personal stake in the company's transactions, and not make secret profits at the company's expense. Put simply, the director must put the company's interests ahead of his own.

Can a director be personally liable for company losses?

Yes. As this case shows, where a director conceals a personal interest and diverts company money to entities he controls, the courts can trace the wrongdoing and impose personal liability for the full loss — here, RM84.64 million plus interest.

What can companies learn from the Protasco decision?

That disclosure of interests is essential, and that Malaysian courts are willing to follow complex cross-border structures to hold directors accountable. It is a useful basis for board training on directors' duties under the Companies Act 2016.

Last updated: 11 August 2026.

This article is published by Khaw Ewe Seng & Co., Advocates & Solicitors (Penang) for general information about Malaysian law. It is not legal advice, and it does not create a solicitor–client relationship. For advice on a specific matter, please consult a qualified lawyer.