Foo Ching Chee v Ang Chew Tee and another

• Jurisdiction: Singapore
• Judge: Teo Jing Lu
• Judgment Date: 22 November 2023
• Neutral Citation: [2023] SGMC 97
• Court: Magistrates' Court (Singapore)
• Docket Number: Magistrate’s Court Suit No 6210 of 2021
• Hearing Date: 06 March 2023,27 April 2023,04 July 2023,18 September 2023
• Citation: [2023] SGMC 97
• Year: 2023
• Plaintiff Counsel: Ms Kulvinder Kaur (I.R.B. Law LLP)
• Defendant Counsel: Mr Richard Lim (Richard Lim & Company Advocates & Solicitors)
• Subject Matter: Tort,Misrepresentation,Actionable representations,Fraud and deceit
• Published date: 30 November 2023

Magistrate Teo Jing Lu: Introduction

This is a trial arising from an unfortunate case of what appears to be a fraudulent investment scheme perpetrated by Equity Advisers Pty Ltd (“EA”), purportedly an Australian licensed forex trading company headquartered in Melbourne. The Plaintiff, Mr Foo Ching Chee (“Foo”), was an investor on EA’s foreign exchange trading platform. Between March 2020 and June 2020, the Defendants were involved in assisting Foo with the setting up of his trading account and the transfer of his funds into said trading account. In total, Foo invested a sum of S$49,500.

On 29 September 2020, Foo was informed that his investments and profits with EA were gone. He was unable to log in to his trading account to check his account balance. On 30 September 2020, EA issued a notice that its trading platform and website were hacked due to a loophole in the security system. When Foo managed to access his trading account sometime in October 2020, he saw negative values of his account balance and profits. Other investors appeared to have encountered the same fate with their trading accounts following the hacking incident.

Foo subsequently wrote to the Australian Securities and Investments Commission to enquire about the legitimacy of EA. It was discovered that there was a company named “Equity Advisers Pty Ltd” which has a licence to provide certain financial services in Australia to wholesale clients.¹ However, this appeared to be a separate company from the EA in question which was offering investment products or providing financial services to retail clients in Singapore. At the trial, parties proceeded on the common ground that the EA as known to parties was a fictitious company, and that the entire set up was an investment ruse. Suffice to say, Foo did not get back the monies he invested.

The Plaintiff thus commenced the present action against the Defendants in a bid to recover the sums invested. However, only the 1st Defendant, Ms Ang Chew Tee (also known as “Amy”), participated in the suit and the trial. The 2nd Defendant, Mr Tan Choong Tat (also known as “Eugene”), was not served with the writ of summons within the validity of the writ for the purpose of service and did not enter an appearance in the suit.² On the first day of the trial, the Plaintiff’s counsel Ms Kulvinder Kaur confirmed that the Plaintiff will only be proceeding with the trial against the 1st Defendant.³

The parties’ cases The Plaintiff’s case

In gist, the Plaintiff alleged that EA was a fraudulent scheme created by Amy to scam innocent investors into thinking that they were investing with a legitimate company.⁴ Specifically, Amy had perpetrated a fraud on Foo by using EA as a front to get Foo to invest monies with her and EA.⁵ According to the Plaintiff, Amy made various representations to Foo. Once she persuaded Foo to part with his monies, Amy then wiped out his account by claiming the website had been hacked.⁶

Foo was introduced to Eugene sometime in or around early 2020. Eugene represented to the Plaintiff that he was selling investment products for EA, and further represented that EA was an Australian licensed forex trading company. Eugene told Foo that he could make substantial profits by investing his monies with the Defendants who were authorised agents of EA.⁷ In reliance on the Defendants’ representations, Foo remitted a sum of S$4,500 to Eugene’s bank account on 13 April 2020 (“the 13 April 2020 Transfer”).⁸

Thereafter, the Defendants continued to make various representations about EA’s profitability in order to induce Foo into investing more monies with them.⁹ They showed Foo brochures and other promotional material reflecting that his profit margin would range between 15% to 25% if he invested a minimum of US$10,000. Through these brochures and promotional material, the Defendants represented that:¹⁰ if Foo invested more than US$10,000, he would make profits of between 15 to 25% of his investment sum; the trading loss, if any, would not exceed 5% of the investment sum; and the currency traded would be EUR-USD, GBP-USD, AUD-USD, USD-CAD. (collectively “the Profitability Representations”)

Amy represented that she was an agent of EA and was EA’s Singapore representative, and that her daughter, son-in-law and other family members had invested at least US$50,000 in EA (“the Family Investment Representations”).¹¹ She induced Foo into making an initial transfer of S$15,000 to her bank account by agreeing to give him a Samsung Tab, and said that a MT5 account would be set up for him to monitor his investments (“the Samsung Tab Representation”).¹²

Furthermore, Amy shared photographs of EA’s purported Australian office which led Foo to believe that EA was a company with a legitimate physical presence.¹³ Amy represented that Foo would qualify to visit EA’s office in Australia if he remitted monies into his MT5 account.¹⁴ She further represented that Foo would receive a ticket to Australia if he remitted at least another US$10,000 (S$15,000) into his MT5 account (collectively “the Australia Trip Representations”).¹⁵

In reliance on Amy’s representations, Foo remitted a total of S$45,000 to Amy personal bank account in three tranches of S$15,000 each on 1 May 2020, 17 May 2020 and 1 June 2020.¹⁶ Accordingly, Foo claims against Amy the total invested sum of S$49,500, with interests and costs.¹⁷

The 1st Defendant’s case

Amy maintained that she was neither an agent nor employee of EA at any point in time. She was not an authorised agent of EA and has never represented to Foo that she is an authorised agent of EA.¹⁸ Amy was simply a regular investor with EA who assisted other investors with the transfer of their investment funds to EA purely in a voluntary capacity, i.e. one investor lending a hand to other investors.¹⁹ Unfortunately, the EA investment scheme turned out to be a scam, and many investors (including Foo and herself) lost their investment monies.²⁰

Amy’s involvement in EA began sometime in late February 2020 or early March 2020 when her friend Thomas brought her to a presentation by EA on investment opportunities. She subsequently invested US$25,000 with EA,²¹ and as an investor she was acquainted with the investment process. The investment process was described by Amy in the following manner:²² First, an investor is required to register a member identification number with EA. Second, the investor will need to create a trading account on EA’s live foreign exchange trading platform known as Meta Trader 5 (“MT5”). Third, the investor is required to transfer the investment funds to the money changer bank account maintained by EA (“MC Account”). There are various MC Accounts belonging to different individuals that EA will designate for investment funds to be transferred to. Fourth, EA will transfer the said investment funds from the MC Account to the investor’s wallet (“EA Wallet”). An investor will then have to transfer the investment funds from his EA Wallet to his MT5 Account. Fifth, after the transfer of the investment funds from the investor’s EA Wallet to the MT5 Account, the investor will be able to trade on his MT5 Account and view the performance of that particular investment on the MT5 Account.

Initially, Thomas was helping investors based in Singapore to transfer monies which they wanted to invest into EA’s MC Account. However, after Thomas left Singapore sometime in April 2020, EA’s executives asked Amy if she could take over Thomas’ role and help investors based in Singapore to transfer investor’s monies into EA’s MC Account. Out of goodwill and as an investor herself, Amy agreed.

Amy only got to know Foo through a WhatsApp group chat created by Eugene on 20 March 2020 (“the EA Foo group chat”). Foo was never formally introduced to Amy. She did not actively seek out Foo in any way, let alone attempt to induce him to invest with EA. Amy was unaware of how Eugene came to know Foo, or the circumstances within which Foo was brought into EA as an investor. Based on the transcripts of the EA Foo group chat, it seems that Foo had already joined EA as an investor even before he was added into the group chat.²³

With regard to the transfer of S$4,500 to Eugene’s bank account on 13 April 2020, Amy was unaware of this transaction and could not have made any representation to Foo.²⁴

As for the transfer of S$45,000 over three separate tranches, it was Foo who voluntarily requested her help to transfer the sums into EA’s MC Account, which Amy did as instructed.²⁵ At no point did Amy ever make any sort of representation to Foo to induce him to invest with EA. Foo made the decision to invest all on his own. By the time Foo approached her, he had already decided to invest.²⁶ The first transfer on 1 May 2020 took place following an exchange of messages on the EA Foo group chat on 30 April 2020.²⁷ Eugene sent a message on 30 April 2020 at 2.09PM stating, “656842 Chin Chee foo USD 100000”. At 3.06PM, Amy replied, “He has yet to join right”. At 3.13PM, Foo messaged, “Hi Amy, already joined. Will let you know when I transfer the fund to you, and you help me to put the fund into EA?” Amy promptly acknowledged Foo’s message, and Eugene proceeded to send Amy’s bank account details into the EA Foo group chat. For the second transfer on 17 May 2020,²⁸ Foo was the one who initiated the transfer through a private message sent to Amy on 17 May 2020 at 2.21PM stating, “Hi Amy, can help me to transfer USD into my wallet?” As the message was unsolicited and came out of the blue, Amy replied, “Who r u?” Foo then identified himself before Amy agreed to help him with the transfer. For the third transfer on 1 June 2020,²⁹ Foo was also the one who initiated the transfer through a private message sent to Amy on 1 June 2020 at 12.55PM stating, “Hi Amy, I would like to top up another 10k. So I transfer SGD15k to you now?” Amy replied unremarkably with her...