A ‘sobering’ experience: CEO on Embed being hauled to court over CPF arrears
Fintech’s sports partners monitoring developments as it faces salary disputes and axed deal with Income Insurance
[SINGAPORE] Being hauled to court and facing enforcement action over unpaid Central Provident Fund (CPF) contributions has been a “sobering” experience, said Embed Financial Group Holdings (EFGH) chief executive Dennis Ng, as major sporting partners monitor their ties with the local fintech firm.
Embed hit the headlines earlier this week when Income Insurance abruptly terminated the proposed sale of its digital insurance platform, Hive, to EFGH. The deal was called off after the authorities launched enforcement actions against EFGH for allegedly failing to make mandatory CPF contributions for six employees.
According to a joint statement on Tuesday (Sep 8) from the Ministry of Manpower (MOM), the CPF Board, and the Tripartite Alliance for Dispute Management (TADM), criminal prosecution was initiated against EFGH after it missed statutory deadlines for CPF payments.
MOM is investigating the firm for potential Employment Act violations concerning non-payment of wages, while TADM has received salary claims that are currently under mediation.
In response to questions from The Business Times, Ng acknowledged the operational strain and human impact of the development: “First, I want to acknowledge the human impact of what has happened. I am not going to minimise that or hide behind corporate language,” he said. “We regret the delays, and EFGH will settle the outstanding CPF contributions in full.”
Ng also tackled criticisms of its tie-ups with several sporting events amid its troubles.
Sporting partners monitor situation
Earlier this year, EFGH was named partner for the BYD Singapore International Marathon in December, and announced a five-year sponsorship partnership with the Singapore National Olympic Council (SNOC).
EFGH also extended its sponsorship of the Tour de France Singapore Criterium for three more years after coming on board in 2025, with the race returning on Nov 7 and 8.
Ng said: “EFGH has not withdrawn from these partnerships, and remain committed to honouring the responsibilities we have undertaken.”
He added that the sports commitments were maintained under separate contractual obligations and were not funded at the expense of staff.
A spokesperson for SNOC expressed concern over the unfolding event: “EFGH has updated us on the situation. We regret that this has occurred and are concerned by the developments. We hope that the outstanding matters can be resolved in the interests of all parties.”
Similarly, Leon Lai, CEO of Singapore International Marathon, noted that organisers are reviewing their steps: “We are aware of reports concerning EFGH. These relate to EFGH’s employment matters and it would not be appropriate for us to comment. While we are in the process of determining next steps with EFGH, we would like to reiterate that (it) has no bearing on the operations of BYD Singapore International Marathon presented by adidas.”
“The event remains fully funded and is proceeding as scheduled, and we remain focused on delivering the event for our participants in December.”
A spokesperson from the Tour de France EFGH Singapore Criterium also confirmed that plans remain unchanged: “We are aware of the matter concerning EFGH. The Tour de France EFGH Singapore Criterium will proceed as planned. Our team remains fully focused on delivering another successful event, and all plans remain on schedule. We will share further updates should there be any developments.”
US listing and future trajectory
Founded two years ago, EFGH is currently a pre-revenue startup navigating regional expansion across Asia and Africa. The startup is also pursuing a public listing in the US via a business combination with a special purpose acquisition company (Spac).
Ng confirmed the Spac transaction remains active.
“The proposed listing is part of our longer-term plan to capitalise and scale the business. The CPF issue is a serious operational matter that we intend to resolve fully. The listing continues through its established regulatory and transaction processes,” he said.
Ng declined to give details on how many months or number of staff were affected by the CPF arrears, adding that the matter remains before the courts, and employment claims are subject to confidential mediation.
According to a Straits Times report, the prosecutor said EFGH owes S$312,484 in CPF contributions. To date, the firm has paid S$300 to the CPF board.
Representing EFGH in court on Wednesday, Lynn Goon, group head of the CEO office, asked for an extension until the end of the month for agreements to be signed, and said EFGH has secured funding from foreign investors. The court granted her request for more time, ordering EFGH to pay $100,000 by the next court hearing on Sept 30.
When asked for the reasons behind the non-payment of CPF, Ng told BT: “I know this leaves some questions unanswered but it would not be right to get ahead of the legal process or compromise the privacy of those involved. What I can say clearly is that EFGH treats the matter seriously and intends to settle the outstanding CPF contributions in full.”
Addressing the disruption to the Hive platform acquisition, Ng said: “On Hive, we respect Income Insurance’s decision. The circumstances surrounding the transaction involve discussions between the two organisations, and we do not believe it would be appropriate to address those discussions publicly. Our focus is on bringing the matter to a proper and respectful conclusion.”
EFGH, a digital financial infrastructure company, was founded two years ago by Ng, whose previous jobs included senior positions in Prudential, Allianz and Citi.
