The naivety of the PAP government

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Five years’ jail for man in GST fraud scheme that cheated Iras of over $2m​

Christine Tan

FEB 29, 2024

SINGAPORE – A man who joined a criminal scheme that cheated the Inland Revenue Authority of Singapore (Iras) of over $2 million has been sentenced to five years’ jail.
On Feb 29, Kelvin Yeo Soon Teck, 42, pleaded guilty to two offences under the Companies Act and one charge of forgery. Two other charges of forgery were taken into consideration for sentencing.
The court heard that the fraud took place from September 2015 to April 2016.
In 2015, Yeo got to know a Vietnamese man, Trinh Tien Dung, known as Don, and a 47-year-old Singaporean man, Francis Tan Nuan Seng.
Don, one of the masterminds, got Yeo on board the scheme to defraud Iras.
Known as “missing trader fraud”, this scheme exploits the goods and services tax system for illicit gain.
The police and Iras said in a previous news release that a typical arrangement for this fraud involves a group of businesses that forms a supply chain through which goods are sold.

At each stop along the supply chain, the seller charges GST on the goods sold. But the original seller then disappears without paying the collected GST to Iras, and becomes the “missing trader”.
Meanwhile, the goods sold down the chain are purportedly exported by the last seller in the chain.
Since exports are zero-rated, this last seller does not collect GST on the exports. Instead, it claims a refund from Iras on the GST paid on its purchases of the goods.

The state will suffer a loss if Iras refunds this last seller, as the “missing trader” had not paid the GST it had collected for its sale of the goods at the start of the chain.
Yeo operated two companies involved in the fraud, M_Solution Trading (MSTPL) and Crescendo Hardware Trading (CHTPL). He ran the operations of MSTPL with Tan, according to court documents.
MSTPL, a shell company incorporated after the men hatched their plan, was the “missing trader” in their scheme. It pretended to sell goods to a chain of other businesses, including CHTPL, and collected 7 per cent GST on its “sales”.
CHTPL was a legitimate company that provided wholesale plumbing and piping equipment, but it was used as a buffer company in the fraud and did not have any real dealings with MSTPL.

Don provided details such as stock specifications, quantities and prices to Yeo, who used the information to forge various sales invoices from MSTPL and CHTPL.
In total, the invoices claimed fictitious sales of more than $115 million.
The scheme resulted in about $7.5 million in fraudulent tax claims filed with Iras. Of these claims, Iras paid out about $2 million.
Yeo received between $110,000 and $140,000 as commission for his role in the scheme.
Deputy Public Prosecutors Matthew Choo, Joshua Phang and Lee Da Zhuan asked for between 62 and 70 months’ jail, noting that this was a serious and sophisticated case of tax fraud.
The prosecutors said GST is an important source of revenue for government expenditure on economic and social programmes.
Said the prosecutors in their submissions: “GST fraud thus has a wide-ranging impact, depriving the Government of the revenue to fund these programmes, and also depriving the public of these programmes’ benefits.”
In mitigation, Yeo’s lawyer, Ms Lim Bee Li, said Yeo faced stress and guilt about his involvement in the scheme and had told Don he wanted out.
“When he made an attempt to tell Don, he faced threats that his family and himself would face danger if he did not continue acting under the instructions of Don,” added Ms Lim.
But District Judge Wong Li Tein did not accept this as a mitigating factor.
“The fact that (Yeo) felt that he could not leave was a consequence of allowing himself to be manipulated by Don,” said the judge, adding that there was no evidence Yeo was forced to continue with the scheme.
Tan’s case is still before the courts. A Singaporean man, Sia Hock Chuan, 57, who was the director of MSTPL, was fined $5,000 for his role in the scheme.
Another local man, Luke Giam Zi Hin, 41, and one Louis Tan, were identified in court documents as one of the masterminds and runners of the scheme respectively. It was not stated if Don and these two men have been arrested.
This is the second prosecution in Singapore involving missing trader fraud, said the police and Iras.
In the other case, involving shell company Nagore Trading, nearly $8 million in fraudulent tax claims were filed with Iras, which was cheated of more than $772,000.
Four men linked to the case were sentenced to between five months’ and four years’ jail. The alleged accomplices’ cases are before the courts.

 

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Jail for man who cheated BCA and gave over $207k in bribes to 2 people to clinch SIA project​

Joseph Ang Kok Leng handed the money to the two men, who were in cahoots, in six separate payments between June and Oct 2019. ST PHOTO: KELVIN CHNG

Shaffiq Alkhatib
Court Correspondent

MAR 01, 2024

SINGAPORE – A man who wanted to secure a project with Singapore Airlines gave more than $207,000 in bribes to a freelance interior designer and an SIA employee.
Joseph Ang Kok Leng, who was a manager at interior design firm Lin ID Group and construction company Lin Builders, handed the money to the two men, who were in cahoots, in six separate payments between June and October 2019.
Separately, he also worked with two other people to cheat the Building and Construction Authority (BCA) in 2020. He was part of a plan to submit false documents to BCA in a move that would allow Lin Builders to bid for projects of higher value.
On Feb 29, Ang, 52, was sentenced to six months’ jail after he pleaded guilty to one count each of graft and cheating.
The freelance designer and the former SIA employee involved in the graft case were dealt with in court earlier.
In September 2023, freelance designer Rex Zhang Jiahao, then 38, was sentenced to eight months’ jail.
Two months later, Lionel Low Jun Jie, then 36, who was an assistant manager of properties (development) at SIA at the time of the offence, was sentenced to 10 months’ jail. He is no longer working for the airline.

In earlier proceedings, the court heard that Zhang and Low had known each other through reservist duties.
At the time of the offence, Low managed ad-hoc renovation projects for SIA, and his duties included conducting quotation or tender exercises.
After receiving quotations or tenders from applicants, he would shortlist contractors for interviews and make recommendations for one to be awarded the project.

Some time from late 2018 to early 2019, SIA conducted a tender for the construction of a two-storey pre-fabricated building with 24 classrooms at its training centre.
In 2018, Low asked Zhang to recommend building contractors for the project.
The two men then agreed for Zhang to find a contractor from whom they could ask for “commissions”.
In late 2018, Ang received a call from Zhang, who asked if he was interested in the project with SIA.
Deputy public prosecutors R. Arvindren and Goh Qi Shuen stated in court documents: “Rex assured Joseph that if he was interested, he could help Joseph qualify for the project by speaking to his contact in SIA, referring to Lionel.”
Ang agreed to be part of the plan.
Low then shared with Zhang that the project had a budget of $2.5 million, as well as other information linked to it, including the expected timelines.
In turn, Zhang disclosed the information to Ang.
The project was later awarded to Lin ID for around $2.17 million. The company was also awarded a separate contract to supply furniture linked to it.
Together, they represented the largest project Lin ID had obtained and completed as at April 2021.
Ang then instructed Lin ID’s employees to prepare the payments to Low and Zhang totalling more than $207,000, which was paid out through six cheques.
In the separate case Ang pleaded guilty to, he worked with two other people linked to Lin Builders to cheat BCA in 2020.
Felicia Low Mun Xin, 35, who was Lin Builders’ chief accountant at the time, and Mohamed Barak Lathif, 51, then its freelance consultant, were each sentenced to four weeks’ jail in 2023.
In 2020, Barak prepared false documents for Lin Builders’ application to BCA to obtain a C1 financial grading, which would allow it to tender for public sector projects worth up to $4 million.
Low and Ang were also part of the plan.
To obtain a C1 grading, the total value of a company’s projects in the past three years should be at least $3 million. Lin Builders’ earlier application in 2019 was rejected as it did not satisfy this requirement.
Due to the false documents, BCA approved Lin Builders’ application for a C1 financial grading in August 2020.
On Feb 29, Ang’s bail was set at $15,000, and he is expected to surrender himself at the State Courts on March 28 to begin serving his sentence.

 

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Jail for ex-director of construction firm over fabricated quotes to Gardens by the Bay​

Tan Hong Chian pleaded guilty to 10 charges under the Prevention of Corruption Act and was sentenced to four weeks’ jail. ST PHOTO: KELVIN CHNG

Shaffiq Alkhatib
Court Correspondent

MAR 18, 2024

SINGAPORE - A director of a construction firm continued with his predecessor’s dishonest ways and became involved in the submission of 48 fabricated supporting quotations to Gardens by the Bay.
Tan Hong Chian, 59, was the director and sole decision-maker of Full House Building Construction when the firm was awarded 25 jobs, worth nearly $96,000 in all, under the dishonest scheme.
On March 18, he pleaded guilty to 10 charges under the Prevention of Corruption Act and was sentenced to four weeks’ jail.
He is no longer a director at Full House, but a search with the Accounting and Corporate Regulatory Authority reveals he is still a shareholder there.
His predecessor and sister-in-law at the time of the offences, Goh Siew Ling, then 51, was sentenced to 13 weeks’ jail in April 2023 after she pleaded guilty to 20 charges under the Prevention of Corruption Act.
In earlier proceedings, Deputy Public Prosecutor Vincent Ong said Goh, also known as Margaret, was a director at Full House from July 2013 to June 2018.
DPP Ong told the court: “Margaret was the key mover and genesis of the conspiracy, whose directions set the entire scheme into motion and perpetuated it across different employees in Full House through her instructions. She is by far the most culpable person involved in the conspiracy.”

She was linked to 88 fabricated quotations. As a result, Full House was awarded 49 jobs, worth nearly $766,000 in all, from 2017 to 2018.
On July 4, 2017, Gardens by the Bay awarded the firm a two-year term contract for building improvement and maintenance work.
The contract had set out a schedule of rates (SOR) that listed the agreed rates for specified common building improvement and maintenance work. For such jobs, Full House would invoice Gardens by the Bay according to the SOR.

There was other work with no rates specified, known as “star rate items”. For such jobs, Full House had to independently obtain three quotations from other firms. It was allowed to submit its own quotation as one of the three.

These submitted quotations would then be reviewed by Gardens by the Bay staff. If they were in order, the staff would make recommendations to their director for approval.
From July 2017, Full House did not obtain genuine quotations from other firms for star rate items, after Goh hatched a scheme to fabricate two quotations that were priced higher than the one from Full House.
As part of the ruse, two of her subordinates would prepare two fictitious quotations using soft-copy templates of other contractors’ company letterheads, which Goh provided.
The subordinates would intentionally price the two quotes higher than the one from Full House.
Full House’s quotation and the two fictitious ones would then be submitted to Gardens by the Bay staff.
On multiple occasions, the job was awarded to Full House.
In 2018, Tan became a director at Full House after buying out its other shareholders, identified as his brother and Goh.
He continued committing similar offences from July to December 2018. Among other things, Tan worked with his then subordinates on a case involving fabricated quotations for painting work at the attraction.
The fabricated quotations contained statements that were false, stating that two other companies had each purportedly quoted sums of more than $6,000 for the job, when in fact both firms had no intention of performing the task.
Full House, which issued a quotation of $3,600, later clinched the job, the court heard.
Tan’s bail was set at $15,000 on March 18, and he is expected to surrender himself at the State Courts on April 4 to begin serving his sentence.

 

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Jail for man who conspired with ex-contractor to steal 140 laptops from National Cancer Centre​

Over the course of investigations, the police recovered 40 out of the 140 laptops which were sold. PHOTO: SINGAPORE POLICE FORCE
Christine Tan

APR 08, 2024

SINGAPORE - A man conspired with a former IT contractor to steal 140 laptops meant for National Cancer Centre Singapore (NCCS) staff, and sold them for more than $68,000.
The former contractor, Mohamed Shahrizal Shaik Mohamed, 31, and his accomplice Muhammad Fairuz Jasni, 38, then gambled the proceeds away.
On April 8, Fairuz was sentenced to 34 months’ jail on two charges of abetting housebreaking and theft.
Shahrizal has been charged. His case is scheduled for a pre-trial conference on April 11.
At the time of the first theft in February 2023, Shahrizal was a desktop support engineer with CTC Global, an IT vendor in charge of buying and installing new laptops and other IT equipment for NCCS. Fairuz was Shahrizal’s friend.
The company bought the laptops at $1,088 each and kept them in an office in NCCS. The room is usually locked, and CTC Global employees have to get a contractor’s pass and a key from a security desk to enter it.
On Feb 16, 2023, Fairuz contacted a user on e-commerce platform Carousell who specialised in selling laptops and said he had more than 10 laptops to sell.

When the buyer asked the origin of the devices, Fairuz said they were from a company which had a surplus of laptops due to a cancelled project.
The next day, Shahrizal and Fairuz stole 10 laptops and sold them to the buyer for $600 each. Court documents did not say how they committed the theft.
On Feb 25, 2023, they stole a second time. Shahrizal went to the office room at noon, packed 25 laptops into two boxes and took them out of the room on a trolley.

Deputy Public Prosecutor Lim Ying Min said: “As (Shahrizal) was responsible for deploying laptops to other departments, his actions did not rouse the suspicion of his colleagues.”
Shahrizal then met Fairuz at the NCCS carpark and loaded the boxes into a car. Fairuz then sold the laptops to the same buyer for $15,000 in total.
CTC Global fired Shahrizal three days later due to poor work performance, but that did not deter the two men from stealing again.
They planned for Fairuz to enter the NCCS building. Shahrizal told Fairuz where the office room was and how to get the contractor’s pass and key.

On March 25, 2023, a Saturday, Fairuz managed to get a contractor’s pass using a false name and requested the key to the office room.
He stole 105 laptops in four trips on that day, and Shahrizal helped to load them onto a van. Fairuz sold them all to the same buyer on the same day for $450 each, or $47,250 in total.
CTC Global staff discovered the missing laptops when they returned to the office the following Monday, and called the police.
The police arrested Fairuz and Shahrizal, who still had $4,500 and $16,000 on them respectively from the proceeds of the crime.
Over the course of investigations, the police recovered 40 out of the 140 laptops that were sold. It is not clear where they recovered those from.
Separately, Fairuz admitted to paying a 17-year-old girl $400 for sexual services, and asking another 16-year-old girl if she wanted to have sex with him. Both offences took place in 2020.
Three other charges relating to theft and one charge of possessing an obscene film were taken into consideration for his sentencing. In total, he was sentenced to 37 months’ jail.

 

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Jail for syndicate member linked to nearly $8 million worth of fraudulent tax claims​

The GST-related offences involved fraudulent claims and the syndicate had forged at least 183 sales invoices. PHOTO: ST FILE

Shaffiq Alkhatib
Court Correspondent

Aug 01, 2024

SINGAPORE - A man admitted being a high-ranking member of a syndicate that exploited the Goods and Services Tax (GST) scheme administered by the Inland Revenue Authority of Singapore (Iras).
Ang Chee Keong, 48, was also involved in two other unrelated criminal schemes, including a phishing scam.
The GST-related offences involved fraudulent claims and the syndicate had forged at least 183 sales invoices, which falsely stated that a firm called Nagore Trading made at least $56 million in sales.
These later formed the basis for nearly $8 million worth of fraudulent tax claims, and Iras paid out more than $772,000 to the offenders.
The prosecution said: “A ‘paper exercise’ (had been) conducted to create a forged paper trail of sham transactions, on which basis fraudulent claims for tax refunds were later made.”
On Aug 1, Ang was sentenced to five years and eight months’ jail after he pleaded guilty to multiple charges including cheating.
Deputy public prosecutors Ryan Lim, Eric Hu, Matthew Choo and Lee Da Zhuan stated in court documents that the two masterminds of the scheme linked to Nagore were Singaporean Luke Giam Zi Hin, 40, and Vietnamese Trinh Tien Dung.

Nagore was used to perpetrate the scheme from Feb 4, 2015 to Jan 28, 2016, but court documents did not disclose the outcome of the pair’s cases.
The DPPs said that in 2014, a man took instructions from Dung and approached Ang to join the scheme which involved setting up of shell companies, but no actual trading would be conducted between them.
Instead, the companies would simply issue forged invoices purportedly showing sales and purchases.

Ang, a Singaporean, agreed to take part in the scheme and another man incorporated Nagore on Dec 20, 2014, with a paid-up capital of $50,000.
Among other things, between Feb 4, 2015 and May 27, 2015, Ang engaged in a conspiracy with his accomplices to forge 106 sales invoices purportedly issued by Nagore for supposed sales to three other firms.
The group continued committing similar offences before Nagore ceased operations on Jan 28, 2016.
The DPPs said: “The accused persons decided that there was an increased risk of detection, should Nagore continue to issue forged sales invoices, given that Nagore had already been operating for close to a year.”
In an unrelated case, the DPPs said that Ang was also involved in a phishing scam, adding: “The accused and his co-conspirators used a machine known colloquially as an ‘SMS Blaster’, mounted in the back of a car, to broadcast SMSes in Singapore’s Central Business District.
“These messages, which appeared to be from (a bank), sought to induce recipients to follow a link to a website, where they would then be asked to enter their (bank) card details.”
Court documents stated that Ang and his co-conspirators then sought to “bind” these cards to payment applications on untraceable “burner” phones, and eventually use them to add value to digital wallets.
On Aug 11, 2022, Ang and his conspirators obtained details for at least four cards and were able to extract $120 from one card held by an unknown victim.
Another 50 cents was charged to a card held by another victim.
“Fortunately, their criminal scheme was short-lived, as the phishing website was shut down by the police a short time after their operation began, said the DPPs.

Ang was also part of a third criminal scheme involving fraudulent transactions on online marketplace Carousell.
For these offences, his co-conspirators obtained bank card details from a certain Telegram group.
Using accounts controlled by themselves, they would cause “buyers” to make sham purchases from a “seller” using those card details.
As a result, banks were defrauded into paying the “seller” the proceeds of those sham purchases.
Over 10 days in August 2022, Ang’s co-conspirators attempted to pay themselves $108,268 using the card details they obtained, and duped the banks into paying out $61,382.
Ang was involved in laundering more than $21,000 of these proceeds.

 

[Loofydralb]

Chinks don't cheat can never get rich.

 

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7 months’ jail for doctor who submitted false claims, cheated MOH of over $11,000​

Wong Choo Wai was the owner of the Bedok Day & Night Clinic and the Jurong Day & Night Clinic at the time of the offences. ST PHOTO: KELVIN CHNG

Shaffiq Alkhatib
Court Correspondent

Aug 30, 2024

SINGAPORE – A doctor who submitted more than 100 false claims linked to a government initiative and cheated the Ministry of Health (MOH) of more than $11,000 in total was sentenced to seven months’ jail on Aug 30.
Wong Choo Wai, 53, has made full restitution. His offences involved the Community Health Assist Scheme (Chas), aimed at helping patients receive subsidies for medical as well as dental treatments at participating general practitioner and dental clinics.
Before handing down the sentence, Principal District Judge Thian Yee Sze stressed that the case involved public funds, which must be protected as they are taken from taxpayers.
On June 14, Wong, the owner of the Bedok Day & Night Clinic and the Jurong Day & Night Clinic at the time of the offences, pleaded guilty to two cheating charges involving more than $7,000.
The Singaporean also pleaded guilty to one count of making false entries in his patients’ clinical records.
Five other charges, including those relating to the remaining amount, were considered during sentencing.
MOH rolled out Chas in 2000, with two polyclinic groups – SingHealth Polyclinics and National Healthcare Group Polyclinics – administering it on the ministry’s behalf.

On behalf of his Bedok clinic, Wong signed an agreement with SingHealth Polyclinics on Feb 15, 2012, to be part of Chas. On June 15 that year, he signed a similar agreement with the National Healthcare Group Polyclinics on behalf of his Jurong clinic.
Under Chas, Wong’s clinics had to provide the subsidies to the patients upfront during their visits. The clinics would then claim the subsidies on a reimbursement basis from MOH. The subsidies were disbursed through the polyclinic groups.
As part of the initiative, participating clinics must submit their claims through an online portal known as eChas within a month from a patient’s visit.

The clinical and financial details of the claims must also be submitted. These included information such as the patients’ personal data, the dates of visits, the types of conditions treated and the cost breakdown of the claims.
Deputy public prosecutors Ng Jean Ting and Louis Ngia stated in court documents that medical facilities did not have to include case notes, receipts and patient consent forms when they submitted their claims.
However, clinics that took part in Chas had to maintain accurate and complete clinical as well as financial records and supporting documents. These must be presented to MOH Holdings (MOHH) – the appointed auditor by MOH for Chas claims – when MOHH performed audits of the claims that the clinics had submitted.
On at least 40 occasions in 2015, Wong used the eChas portal to submit false claims to MOH, which was duped into disbursing $1,755 to his Bedok clinic. He had falsely claimed to have treated certain patients.
Wong committed similar offences on at least 76 occasions in 2016, and MOH was deceived into delivering $5,872.
On at least 21 occasions between August and December 2016, he also made false entries in his patients’ clinical records, recording that they had consulted him for certain medical ailments when, in fact, they had not.
The prosecutors said: “The accused... falsified these clinical records in order to conceal some of the false Chas claims he had submitted.”
Wong’s offences came to light following MOHH audits in or around February 2017, and an MOH officer alerted the police the following month.
On Aug 30, DPP Ngia asked for Wong to be given between seven and nine months’ jail, adding that he had committed fraud against a public institution.
Defence lawyer Andre Jumabhoy, however, pleaded for his client to be given up to five months’ jail.
He said that Wong had contributed to society and was on the front line during the Covid-19 pandemic.
Wong’s bail has been set at $60,000 and he is expected to begin serving his sentence on Sept 2.

 

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2 jailed for submitting fake tender to NLB to help another firm win $4.7m contract​

On Sept 23, Kwa Kaoh Wee (left) and Soh Ling Ling pleaded guilty to one corruption charge each. ST PHOTOS: KELVIN CHNG
Andrew Wong

Sep 23, 2024

SINGAPORE - A company director allowed his firm to submit a fake tender to the National Library Board (NLB) to help another company win a contract worth more than $4.7 million, believing that the latter would give part of the project to his company.
The ruse came to light when the Corrupt Practices Investigation Bureau began investigating NLB assistant director Adrian Chan Siew Leng, 48, over a series of corruption and cheating charges.
On Sept 23, Kwa Kaoh Wee and Soh Ling Ling pleaded guilty to one corruption charge each.
Kwa was sentenced to a month’s jail while Soh was sentenced to two weeks’ imprisonment.
The court heard that at the time of the offence, Kwa was the managing director and sole shareholder of Multimedia Maestro, referred to as MM in court. Its primary business include cinema maintenance and broadcast consultancy.
Soh was an administrative manager in the company. She became a director in the firm in 2019.
A search on Singapore’s business registry showed the pair are still co-directors of at least two other companies.

In March 2018, the NLB opened a tender to commission a fully operational digital cinema system at the Oldham Theatre, of which Chan was the project lead.
Around that period, Chan had indicated to an associate, John Paul Tan Wei Ming, that he wanted the tender to be awarded to Electronics and Engineering, referred to as E&E.
The prosecution did not elaborate on why Chan wanted the tender to be awarded to E&E.

Chan told Tan, a co-accused, to find at least two other companies to submit bids higher than E&E’s to ensure that the tender would proceed.
This would also ensure E&E’s bid would appear the most attractive. Tan then spoke to another co-accused named Fong Choon Yew, 52, who in turn informed his subordinate, Ho Chan Shen, 57, to contact MM to make the fake tender bid.
The court heard that Ho contacted Kwa and told him to submit a tender bid for the project.

The prosecution said Kwa understood the ramifications behind the request but decided to proceed as he believed E&E could give a part of the project to his company if E&E was awarded the tender.
Kwa then told Ho to contact Soh for the paperwork.
The prosecution said Soh had understood that Ho was asking for MM to submit a bid to help E&E win the tender. She and Kwa agreed to help.
In April 2018, Tan sent MM a quotation he had prepared for Soh to submit for the tender. The prices indicated in the quotation were significantly higher than E&E’s bid.
E&E won the five-year contract valued at more than $4.7 million in June 2018.
The prosecution said in this case, Kwa’s culpability appeared higher than Soh’s as he was her superior at the time of the offence.
The prosecution added that all the co-accused in the case have been charged.
The cases involving Fong and Ho have been fixed for a pre-trial conference on Oct 1.

 

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Jail for man over tax fraud that caused Iras to lose more than $2m​

Francis Tan Nuan Seng pleaded guilty to one count each of fraudulent trading, criminal breach of trust, and forgery. ST PHOTO: KELVIN CHNG

Shaffiq Alkhatib
Court Correspondent

Sep 23, 2024

SINGAPORE - He took part in a case of fraud involving a syndicate that exploited the Goods and Services Tax (GST) system, causing a loss of over $2 million to the Inland Revenue Authority of Singapore (Iras).
The prosecution said that Francis Tan Nuan Seng’s offences were linked to “voluminous paper trails of sham transactions, purportedly made by several shell companies for fraudulent claims of input tax”.
Separately, he also misappropriated $39,500 in cash.
On Sept 23, the 48-year-old Singaporean was sentenced to four years and two months’ jail after he pleaded guilty to one count each of fraudulent trading, criminal breach of trust, and forgery.
One of his accomplices, Kelvin Yeo Soon Teck, then 42, was sentenced to five years’ jail in February.
Deputy public prosecutors Eric Hu, Matthew Choo and Lee Da Zhuan told the court that though Tan played an important role in the syndicate, he was not the mastermind of the scheme.
The DPPs added that the masterminds were Vietnamese Trinh Tien Dung, also known as “Don”, and Singaporean Luke Giam Zi Hin, 41.

Court documents did not disclose the outcome of the cases involving the pair.
The ruse involved a firm called M_Solution Trading (MSTPL), with Dung directing its operations, the prosecution said.
According to court documents, he also directed the operations of another firm called Crescendo Hardware Trading (CHTPL).

In 2015, Tan met Dung who told him about the scheme and the Singaporean agreed to be part of it.
In a joint statement in September 2023, the police and Iras said that in a typical arrangement under such a ruse, a group of businesses would form a supply chain through which goods are sold.
Meanwhile, the goods sold down the chain are purportedly exported by the last seller in the chain.
Since exported goods are exempt from GST, the last seller does not collect GST on the exports.
Instead, it claims a refund from Iras, causing a loss to the State if the ruse is successful.

For the current case, the court heard that MSTPL was a shell company with no genuine business.
It pretended to sell goods to a chain of other businesses, including CHTPL, and collected 7 per cent GST on the “sales”.
After that, MSTPL would go “missing” by failing to account to Iras the GST collected from the “sales”.
The DPPs said: “(Tan) acted on Don’s instructions on the forgery of MSTPL’s sales invoices. Don provided the stock specifications, quantities, prices and customers to be indicated on the forged invoices.”
Tan and Yeo also worked together to forge 90 sales invoices purportedly issued by MSTPL over supposed sales to companies including CHTPL.
Overall, the scheme resulted in the submission of fraudulent tax claims amounting to about $7.53 million to Iras.
From this amount, Iras paid out more than $2 million in tax refund claims. The court heard that Tan received a commission of more than $19,000 for operating MSTPL with Yeo.
In an unrelated case, the sole proprietor of another firm not linked to the ruse issued Tan a cash cheque for $39,500 in 2019 to buy computer servers.
Tan encashed the cheque and used the money to cover his loss arising from operating a pub that has since shuttered.
His bail was set at $70,000 on Sept 23, and he is expected to begin serving his sentence in November.

 

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Temasek-owned GenZero to review carbon credit investment after fraud charges​

GenZero said in a statement that they are assessing the implications on the integrity and impact of the current outcomes on the carbon credit programme. PHOTO: GENZERO.CO

David Fogarty
Climate Change Editor

Oct 04, 2024

SINGAPORE – Temasek-owned investment firm GenZero said it is reviewing its involvement in a South-east Asian carbon credit programme after US federal prosecutors filed fraud charges against a senior figure behind the company running the programme.
Former C-Quest Capital (CQC) chief executive officer Kenneth Newcombe, who stepped down from the role in February, was indicted on Oct 2 in New York on wire fraud and securities and commodities fraud charges.
Under Newcombe, the US-based CQC ramped up its programme from 2021 to roll out more efficient cookstoves to local communities, mainly in Africa and Asia. The stoves are said to burn less fuel and produce less pollution. Carbon credits can be claimed for each tonne of carbon dioxide (CO2) emission avoided.
Newcombe and some of his ex-colleagues were charged over fraudulently exaggerating the amount of emissions avoided and duping investors in a case that risks further damaging the already tarnished image of the global voluntary carbon market.
Among the others facing charges are Tridip Goswami, former head of CQC’s carbon and sustainability accounting team, and Jason Steele, the company’s former chief operating officer.
The 77-year-old Newcombe, a pioneer of the carbon credit market, denies any wrongdoing, Bloomberg reported, quoting a statement from him.
GenZero said in a statement to The Straits Times on Oct 3: “As a partner in C-Quest Capital’s South-east Asia Clean Cookstove Programme, we are assessing the implications on the integrity and impact of the current outcomes on the programme.

“We take allegations of wrongdoing by our programme partners seriously, particularly when those actions impact the credibility of carbon markets.”
In a deal announced in 2022, GenZero and Pavilion Energy – until recently a wholly owned subsidiary of Temasek – invested US$14 million (S$18.3 million) in the South-east Asia cookstove programme.
Pavilion Energy told ST on Oct 4 it has fully exited the CQC project and has no further comment.

In a statement, the US Attorney’s Office for the Southern District of New York accused Newcombe and his co-defendants at CQC of fraudulently obtaining carbon credits worth tens of millions of dollars, and fraudulently securing more than US$100 million in investment. The charges are related to misdeeds allegedly committed between 2021 and 2023.
The statement said the defendants “manipulated data to make it appear as if certain cookstove projects were far more successful in reducing carbon emissions than was actually the case”.
The statement cited internal e-mails showing that there was a coordinated attempt to inflate the emission reductions of several projects or claim reductions from cookstoves that did not exist.
As a result, investors were misled, along with the carbon credit standards body Verra. Verra is the main non-profit organisation that vets and verifies voluntary carbon credit projects and issues carbon credits for those projects.

Because of the allegedly false information from CQC, Verra was “tricked” into giving CQC carbon credits for emission reductions that, according to Verra’s methodology for calculating such reductions, had not in fact been achieved, the US Attorney’s Office statement said.
In a June 26 statement, CQC said it had uncovered the suspected fraud and voluntarily notified the US authorities. The company has not been charged.
On the same day as CQC’s statement, Verra said it had immediately suspended 27 CQC projects, most of them cookstove projects, and launched a review of the projects.
The regional cookstove programme involved projects in Cambodia, Laos, Thailand and Vietnam. In a blog posting announcing the funding agreement with GenZero and Pavilion Energy at the time, CQC said: “The investment will initially fund the deployment of clean cookstoves to 650,000 rural households... with the opportunity to further scale to one million households.”
All four projects were fully verified and registered under Verra.
CQC said in June that it was “voluntarily facilitating the cancellation of any over-issued credits from its inventory in Verra” and “adopting new measurement, reporting and verification processes, crediting methodologies, and policies to ensure its future activities meet the highest ethical standards”.
A Verra spokesman told ST the review into the 27 suspect CQC projects was ongoing.
The spokesman said that if they find there has been an excess issuance of credits, CQC is then responsible for compensating for that excess. And one way to resolve this is to cancel the excess credits, meaning they are removed from Verra’s registry.
The global voluntary carbon market has been hit by a series of investigations and media reports alleging some carbon credit projects, including investments such as tree plantations or to protect threatened areas of rainforest, have been issued with too many credits.
There have also been allegations that some projects were not truly “additional”.
Carbon credits are meant to compensate investors for projects that would not otherwise have happened without the revenue from credit sales.
For instance, a project could be protecting a patch of rainforest that was in danger of being cleared for mining or agriculture. But in some cases, the carbon projects would have gone ahead anyway, meaning they were not “additional”.

Yet, many carbon credit projects are good for the climate and local communities, experts say.
And for an industry that is already working on tougher standards, stronger rules and quick responses to any instances of alleged fraud are positive signs.
Ms Donna Lee, co-founder of carbon credit project ratings firm Calyx Global, told ST the case involving Newcombe and his associates was a rarity in the voluntary carbon market, which was worth about US$2 billion in 2023.
“We believe the vast majority (of cookstove projects) are not engaging in the fraudulent activity,” she said.
“Many cookstove projects are engaging in legitimate mitigation activities that benefit the atmosphere, as well as the health of women and children. The methodologies for measuring that impact need to be updated to avoid over-claiming, but we should not confuse this issue with falsifying information,” she said.
GenZero, which is focused on accelerating global decarbonisation, including carbon credit project investments, said: “Stronger governance, enhanced transparency and clearer guard rails will drive progress and greater confidence in the integrity of the voluntary carbon market.”
ST has contacted CQC for comment.

 

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The PAP MPs in NTUC's Central Committee: Ng Chee Meng, Heng Chee How, Desmond Tan,
The PAP MPs, former PAP MPs and ministers on the board of directors of NTUC Enterprise: Lim boon Heng, Lim Swee Say, Ng Chee Meng
are all sleeping!

NTUC central committee not aware of capital reduction plan in Allianz-Income deal: Desmond Tan​

NTUC Enterprise went into the deal to strengthen Income in the longer run as it recognised the challenges that Income had been facing. ST PHOTO: AZMI ATHNI

Goh Yan Han
Political Correspondent

Oct 17, 2024

SINGAPORE – The labour movement’s central committee did not know of the plan to return $1.85 billion to shareholders under the Allianz-Income deal before it was mentioned in Parliament on Oct 14, said NTUC deputy secretary-general Desmond Tan.
Speaking in Parliament on Oct 16, Mr Tan said the central committee had been briefed by Income Insurance and its parent company, NTUC Enterprise, on the strategic imperatives of the deal, but the capital reduction plan was not highlighted to it.
As Income is a non-listed public company, it would have to comply with the legal responsibility of non-disclosure of commercially sensitive information on Allianz’s plans post-acquisition, he said.
Mr Tan made the point in response to questions from Non-Constituency MP Leong Mun Wai and Nominated MP Raj Joshua Thomas during the debate on the Insurance (Amendment) Bill, adding that Income is subject to the Singapore Code on Take-overs and Mergers.
The capital reduction plan is a key factor in the surprising turn of events that saw the Government block the hotly debated $2.2 billion deal between Income and German insurer Allianz that was first made public in July.
Allianz had made an offer to buy a controlling stake of at least 51 per cent in Income.
On Oct 14 in Parliament, Minister for Culture, Community and Youth Edwin Tong said in a ministerial statement that the Government had decided it would not be in the public interest for the transaction to proceed in its current form.

While the Government does not have concerns over Allianz’s standing or suitability to acquire a majority stake in Income, the concerns lie in the terms and structure of this specific transaction, particularly in the context of Income’s corporatisation exercise, he said.
Mr Tong added that before the deal was raised in Parliament in August, his ministry had not seen the plan for Income to return some $1.85 billion in cash to its shareholders within the first three years after completion of the transaction.
During the debate on the Insurance (Amendment) Bill on Oct 16, Mr Tan explained why NTUC had supported the proposed deal.

When NTUC was briefed on the proposal, it was difficult for the unions to learn that Income was planning to sell a majority stake to Allianz, given the company’s history as the labour movement’s first social enterprise, said Mr Tan, who is Senior Minister of State in the Prime Minister’s Office.
But NTUC Enterprise went into the deal to strengthen Income in the longer run as it recognised the challenges that Income had been facing amid a more competitive and tightly regulated insurance landscape, he noted.
“The NTUC central committee agreed with the strategic intent and approached it in good faith,” he said.
He also clarified that NTUC, as a major shareholder of NTUC Enterprise, does not get involved in the day-to-day running of operations.

It delegates to the board of NTUC Enterprise the responsibility of making decisions pertaining to all businesses.
Mr Tan also noted that Second Minister for Finance Chee Hong Tat had acknowledged that NTUC had acted in good faith and in the interest of workers and members.
“If you look at it, the Government and NTUC share the same strategic intent and broader objectives for Income and the co-op movement,” said Mr Tan.
“But as far as the specifics of this transaction are concerned, there is now perhaps a difference in view,” he added, referring to the concerns Mr Tong had raised about the deal.
He added that NTUC has reviewed the matter and accepts the Government’s considerations and decisions on the proposed transaction.
“We note that the Government remains open to any arrangement that Income may wish to pursue, whether with Allianz or any other partners, so long as the concerns highlighted are fully addressed.”
Mr Tan added that Income has committed to study carefully the implications of the ministerial statement by Mr Tong and the amendments of the Insurance Act, and will work closely with the relevant stakeholders to decide on the next course of action.
“The labour movement – which includes NTUC Enterprise and NTUC – is united in (its) purpose and we will continue to do right by our people, and what is necessary for the longer-term interest to serve workers and the people of Singapore,” he said.
In a Facebook post on the evening of Oct 16, labour chief Ng Chee Meng said the decision to halt the Allianz-Income deal and its implications were of key concern to the labour movement and union leaders who had supported the deal.
He added that Deputy Prime Minister Gan Kim Yong, Mr Tong and Mr Chee held an “honest and productive engagement” with NTUC and union leaders to clarify issues after the Parliament sitting.
“NTUC respects and accepts the Government’s decision that the transaction cannot proceed in its current form,” he said.

 

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Forum: Need to be more rigorous when examining future proposals after failed Allianz-Income deal​

Oct 18, 2024

Some Singaporeans are understandably relieved at the timely intervention by the Government to block the contentious $2.2-billion deal between NTUC Income and German insurer Allianz on concerns over the deal structure and the ability of the local insurer to continue its social mission (Parliament passes Bill enabling Govt to block Allianz-Income deal; and NTUC central committee not aware of capital reduction plan in Allianz-Income deal: Desmond Tan, both Oct 16).
It is puzzling that the NTUC central committee was briefed on the strategic synergies of the deal for Allianz to buy a controlling stake in Income, but not on the capital reduction plan to return $1.85 billion to shareholders.
As Minister for Culture, Community and Youth Edwin Tong said, Singapore continues to be open to future new proposals if the terms and structure of the proposed deal are robust, protect the public interest, and do not compromise the ability of Income to carry out its social mission.
Hopefully, the takeaways from this failed deal will provide food for thought for a more holistic, rigorous and thoughtful methodology with which to screen investments and assess future proposals.

Woon Wee Min

 

[LITTLEREDDOT]

Questions to be answered in the Allianz-Income saga​

The deal between Allianz and Income Insurance was called off by the Singapore Government. ST PHOTO: ARIFFIN JAMAR
Angela Tan and Kang Wan Chern

Oct 18, 2024

SINGAPORE - A plan for German insurer Allianz to buy a majority stake in Singapore’s Income Insurance went awry when a key piece of information belatedly came to light.
Allianz’s plan to return $1.85 billion in cash to shareholders within three years after the transaction in a capital reduction exercise proved to be a sticking point, prompting the Government to urgently pass new laws on Oct 16 to halt the deal.
Had the planned deal gone through, Allianz would have taken a stake of least 51 per cent in Income. NTUC Enterprise would have seen its stake in Income shaved from 72.8 per cent to between 21.8 per cent and 49 per cent, depending on how minority shareholders tender their shares.
The changes to the Insurance Act allow the minister in charge of the Monetary Authority of Singapore to withhold approval in cases that involve an insurer that is a cooperative or is linked to one.
Income used to be a cooperative before it changed its legal structure to a company in 2022, and parent NTUC Enterprise is a cooperative.
NTUC Enterprise, in turn, is set up by the National Trades Union Congress (NTUC), the Singapore Labour Foundation and their affiliated unions.
In a four-hour debate on Oct 16, MPs from both the ruling and opposition parties – as well as Nominated MPs – raised several points related to Income and NTUC entities.

Industry experts who spoke to The Straits Times also questioned the role of those involved in the deal.
ST examines the issues and some of the questions that remain unanswered.

Communication about the capital reduction plan​

NTUC deputy secretary-general Desmond Tan said on Oct 16 that the labour movement’s central committee did not know of the insurers’ plan to return $1.85 billion to shareholders before it was made known in Parliament on Oct 14.

He was responding to questions posed by backbenchers including Progress Singapore Party’s Non-Constituency MP Leong Mun Wai and Nominated MP Raj Joshua Thomas.
Mr Leong had asked about when NTUC’s leaders were briefed on the offer. “If the NTUC central committee did not know the full details, then why did NE (NTUC Enterprise) and Income not brief them on the full details of the transaction?”
Mr Thomas pointed out that NTUC’s secretary-general Ng Chee Meng and president K. Thanaletchimi had issued a statement on Aug 5 that Income can continue to fulfil its social mission only if it has access to additional resources and the ability to scale.
“Did Income brief the NTUC leadership of the proposed initiative to reduce share capital?” he asked.
Mr Tan said that NTUC is a major shareholder of NTUC Enterprise and does not get involved in day-to-day operations, with business decisions delegated to the board of NTUC Enterprise.
In a nod to the questions that MPs posed to NTUC, Income and NTUC Enterprise during the debate, he said: “I will take these comments and questions back... to the relevant entities, so they can find a suitable occasion to address them.”

Singapore Management University’s Associate Professor Eugene Tan told ST that “it boggles the mind that NTUC’s central committee did not know of the capital reduction”.
He noted that NTUC’s Mr Ng also sits on NTUC Enterprise’s board.
“Serious questions must be asked on why this vital part of the proposed deal was not prominently surfaced by NTUC Enterprise to Income’s board and shareholders, as well as the authorities,” Prof Tan said.
Professor Lawrence Loh, director of NUS Business School’s Centre for Governance and Sustainability, added that the Government could also consider improving its regulatory coordination.

Accountability and leadership​

Questions were also raised about how those involved in the decision-making process might be held accountable for how the proposed deal did not match up to earlier assurances made by Income.
During Income’s corporatisation in 2022, it had obtained an exemption from the Ministry of Culture, Community and Youth (MCCY), which oversees the governance of co-ops, to carry over a surplus of $2 billion to the new entity.
Then, Income also told MCCY that it was aiming to build up capital resources and enhance its financial strength.
Mr Thomas asked in Parliament if the Government would be taking steps to ascertain how Income could “negotiate, agree and attempt” to execute a deal with Allianz that was the “opposite” of Income’s representations to MCCY.
He noted that the chairman and chief executive of Income at the time of corporatisation and announcement of the proposed deal with Allianz were the same people.
“How involved were they and the senior management of Income in, on the one hand, making representations to MCCY, and, on the other, arranging the deal with Allianz? Did they not see the contradictions?” Mr Thomas said.
Mr Leong also outlined concerns in Parliament over what NTUC leaders had represented to the public about the deal, when there appeared to be a lack of safeguards on the ability of Income to carry out its social mission.
“The leaders of NTUC, NE and Income owe the public a more substantial explanation on this,” he said.
Prof Tan said that a thorough explanation of how things went wrong is warranted. “Otherwise, the next proposed merger or acquisition is going to have stakeholders be wary from the get-go.”
He also raised doubts about Income’s financial adviser Morgan Stanley. “Did they not see the capital reduction as raising serious questions about Income’s corporatisation and its social mission?”
Income’s chairman Ronald Ong is also chairman of Morgan Stanley’s South-east Asia business. Income said in July that he had recused himself from the decision when Morgan Stanley was appointed as the financial adviser for the deal.
NMP Neil Parekh said during the Oct 16 debate that he failed to understand how Income does not have larger market share and greater pricing power, and said the company needed “strengthening”.
To this end, he suggested that “a new Singaporean-controlled board of directors with real talent, real experience and a real vision” could be put in place.
They could then be tasked with developing a “coherent five-to-seven-year plan to make Income Insurance a world-class company operating profitably not only in Singapore but also in other countries in Asia ex-Japan”, he said.

What next for Income and its shareholders​

MPs also called for explanations of how Income will continue to operate profitably and fulfil its social mission going forward.
Workers’ Party MP He Ting Ru (Sengkang GRC) asked the Government to articulate what it sees as Income’s social mission now, and in the future, given the evolving and competitive insurance landscape.
She asked the Government to redefine Income’s social mission as a life or health insurer to avoid the risk of it focusing only on delivering its present obligations, such as participating in national-level insurance programmes and providing low-cost schemes to union members.
“If we leave the question of what is ‘social mission’ unanswered, it risks presenting these specific matters as central, while missing the wider picture of how Income is fundamentally able to fulfil its social mission as an insurer,” she said.
Mr Thomas said the question of how Income can leverage its corporate structure to meet social objectives may need to be looked at, adding: “I think that Income has a lot of explaining to do.”
Prof Tan noted that had the capital reduction gone ahead, NTUC Enterprise would have a significant cash infusion of about $1 billion that it otherwise would have no access to, and which it could then deploy elsewhere.
“The losers, however, would be Income and Singaporeans because of the real risk that Income would erase or lose its social DNA. As a minority shareholder, NTUC Enterprise could struggle to keep Income’s social mission alive,” he said.
For now, it seems that “elements within NTUC have lost sight of the purpose of its existence. There seems to be a quest for profits that is at odds with NTUC’s purpose”, Prof Tan added.

Sequence of key events​

July 17: German insurer Allianz offers to buy a stake of at least 51 per cent in Income Insurance in a $2.2 billion cash deal.
Mid-July: Allianz, Income and its parent NTUC Enterprise submit plans to the Monetary Authority of Singapore (MAS) around the time the offer was made. It includes details about Income returning $1.85 billion in cash to shareholders within the first three years after the deal wraps up. This was not publicly disclosed.
July 25: NTUC Enterprise chairman Lim Boon Heng says that Income will continue to provide affordable insurance after the deal. The statement comes after some former executives and members of the public raised concerns about the insurer’s social mission.
July 27: Income issues a statement that its chairman Ronald Ong had recused himself when Morgan Stanley was appointed as the financial adviser for the deal, after questions were raised about it.
July 30: Mr Lim, Income chief executive Andrew Yeo and Income board’s lead independent director Joy Tan further clarify concerns over the deal in an interview with ST and in a separate joint statement.
Aug 4: NTUC Enterprise and Income rebuts an open letter by former NTUC Income chief executive Tan Suee Chieh, in which he objected to the Allianz offer.
MCCY Minister Edwin Tong writes in a Facebook post that co-ops as social enterprises must be financially sustainable in order to better serve their members in a fast changing economic environment.
Aug 5: NTUC’s secretary-general Ng Chee Meng and president K Thanaletchimi say in a joint statement that the central committee was briefed on the deal, and outlined why Income needed to become more competitive.
Aug 6: The deal is debated in Parliament. The Ministry of Culture, Community and Youth (MCCY) is unaware of the post-transaction details at this time.
After Aug 6: MCCY continues to do due diligence and enquire further into proposed deal. MAS provides MCCY with further details, including Income’s capital optimisation plan as the regulator felt it could be relevant to the ministry’s views on the deal. MCCY had not seen this information earlier.
Oct 14: MCCY minister Edwin Tong tells Parliament that the Government will halt the deal in its current form on concerns over its structure and ability of Income to continue serving its social mission. A Bill to amend the Insurance Act is tabled on an urgent basis.
In a late statement, Allianz says it will consider revising the deal structure. Income and NTUC Enterprise say they will work closely with stakeholders on the next course of action.
Oct 16: NTUC Deputy Secretary-General Desmond Tan tells Parliament that NTUC’s central committee was unaware of the capital extraction plan and learnt of it on Oct 14. MPs debate the issue for nearly four hours, and vote to pass the Bill.

 

[Eisenhut]

Forum: Need to be more rigorous when examining future proposals after failed Allianz-Income deal​

Oct 18, 2024

Some Singaporeans are understandably relieved at the timely intervention by the Government to block the contentious $2.2-billion deal between NTUC Income and German insurer Allianz on concerns over the deal structure and the ability of the local insurer to continue its social mission (Parliament passes Bill enabling Govt to block Allianz-Income deal; and NTUC central committee not aware of capital reduction plan in Allianz-Income deal: Desmond Tan, both Oct 16).
It is puzzling that the NTUC central committee was briefed on the strategic synergies of the deal for Allianz to buy a controlling stake in Income, but not on the capital reduction plan to return $1.85 billion to shareholders.
As Minister for Culture, Community and Youth Edwin Tong said, Singapore continues to be open to future new proposals if the terms and structure of the proposed deal are robust, protect the public interest, and do not compromise the ability of Income to carry out its social mission.
Hopefully, the takeaways from this failed deal will provide food for thought for a more holistic, rigorous and thoughtful methodology with which to screen investments and assess future proposals.

Woon Wee Min

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Promotion to skolar who spotted this

Demotion for those who were not aware of this?