District Judge Kow Keng Siong:
Introduction
Mdm. Lim Beng Kim, Lulu (“the Accused”) faces 36 charges under s 420 and s 477A of the Penal Code (Cap 224, 2008 Rev Ed) (“Penal Code”). Her offences have been described as “one of the largest and most complex fraudulent trade financing schemes ever to be prosecuted before the courts”. These schemes had spanned three years, defrauded 16 financial institutions (“the victims”), led to the grant of at least US$586.5 mil in credit facilities to the Accused’s company, caused the victims to suffer a staggering loss of more than US$469,102,278.91 (S$631,224,026.50), and tarnished Singapore’s reputation as a global commodity trading hub.
The Accused pleaded guilty to 12 of her charges and consented to the remaining charges to be taken into consideration for the purpose of sentencing. The parties submitted for the following sentences:
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| Charge | Amounts involved | Prosecution’s sentence | Defence’s sentence |
| 2 | DAC-920144-2021 S 477A | Falsification of FY2018 financial statement, purporting that it was unqualified | 18 months | 6 months |
| 4 | DAC 923583-2021 S 420 | Credit granted: US$23,000,000 Loss suffered: US$20,361,773.52 | 66 months | 45 months |
| 5 | DAC-923584-2021 S 420 | Credit granted: US$11,879,534 Loss suffered: US$9,909,533.83 | 66 months | 45 months |
| 8 | DAC-923587-2021 S 420 | Credit granted: US$15,000,000 Loss suffered: US$14,126,183.16 | 66 months | 45 months |
| 10 | DAC-923589-2021 S 420 | Credit granted: US$80,000,000 Loss suffered: US$77,451,628.81 | 78 months (consecutive) | 60 months (consecutive) |
| 11 | DAC-923590-2021 S 420 | Credit granted: US$19,981,574.74 Loss suffered: US$15,799,275.36 | 66 months | 45 months |
| 16 | DAC-900161-2022 S 420 | Credit granted: up to US$100,000,000 Loss suffered: US$96,775,765.55 | 78 months (consecutive) | 60 months |
| 17 | DAC-900162-2022 S 420 | Credit granted: US$38,403,382.64 Loss suffered: US$32,570,456.43 | 72 months | 50 months |
| 20 | DAC-900165-2022 S 420 | Credit granted: US$69,946,924.12 Loss suffered: US$66,661,282.64 | 78 months (consecutive) | 60 months |
| 30 | DAC-903337-2022 S 420 | Credit granted: US$44,988,562.17 Loss suffered: US$40,255,936.06 | 72 months | 50 months |
| 31 | DAC-903338-2022 S 420 | Credit granted: US$49,999,999.88 Loss suffered: US$18,639,054 | 72 months | 50 months (consecutive) |
| 34 | DAC-908223-2022 S 420 | Credit granted: US$24,500,000 Loss suffered: US$21,887,214.90 | 66 months | 45 months |
| Aggregate | Credit granted: US$477,699,977.65 (S$647,904,479.69) Loss suffered: US$414,438,104.26 (S$562,102,400.81) | 234 months (i.e., 19 years, 6 months) | 110 months (i.e., 9 years, 2 months) |
Background
Agritrade International Pte Ltd
At all material times, the Accused was the chief financial officer (“CFO”) and executive director of Agritrade International Pte Ltd (“AIPL”), a global trading house based in Singapore. AIPL’s businesses included trading and refining in commodities, as well as providing logistical support for regional land reclamation and construction projects. AIPL’s founder and the Accused’s boss was Ng Say Pek (“Ng”).
Funding for AIPL’s businesses
AIPL conducted its business through trade financing. Under this form of financing, AIPL would provide the financial institutions with documentary proof that it had entered into agreements to purchase/sell goods (e.g., invoices and shipping documents), and the financial institutions would then disburse funds to the appropriate party.
The Accused and Ng were responsible for securing trade financing facilities from the financial institutions. Both knew that in determining the credit line to be extended to AIPL, these institutions would rely on, among others, AIPL’s financial statements for the preceding financial years.
Falsified financial statements
The Accused’s charges involve three sets of falsified financial statements. These statements came about in the following circumstances: Sometime in late 2016, late 2017, and late 2018, the Accused provided a copy of AIPL’s management accounts to Corporate Assurance PAC (“PAC”), an auditing and accounting firm. This was for the purpose of preparing a set of draft consolidated financial statements for AIPL and its subsidiaries for the financial years ending on 30 June 2016 (“FY2016”), 30 June 2017 (“FY2017”), and 30 June 2018 (“FY2018”). The Accused dealt with James Raj (“James”), a PAC director, and Hartasha Kaur (“Hartasha”), a PAC employee for this purpose. Hartasha prepared the draft consolidated financial statements for FY2016, FY2017 and FY2018, and emailed them to the Accused. The Accused knew that these consolidated financial statements had not been audited by PAC. Separately, Tang Choon Foo (“Tang”), the auditor assigned by PAC to audit AIPL, had issued (in his official capacity) AIPL’s financial statements for FY2016, FY2017 and FY2018 (“audited FY2018 financial statements”). Unlike the draft financial statements prepared by Hartasha, the financial statements that Tang had issued were audited and non-consolidated. Further, they contained information on AIPL’s financials that were different from Hartasha’s drafts. Tang’s audited financial statements had also contained an auditor’s report which stated that PAC’s opinion was qualified. This is because from 2016 to 2018, AIPL had failed to provide Tang with relevant financial information of its overseas subsidiaries that he needed for the purpose of issuing audited and consolidated versions of AIPL’s financial statements. Because of Tang’s refusal to issue unqualified consolidated financial statements, the draft (unaudited) consolidated financial statements for FY2016 and FY2017 prepared by Hartasha were subsequently falsified through the inclusions of an auditor’s report (“the falsified FY2016 and FY2017 financial statements”). Further, the falsified FY2017 financial statements included a statement which falsely claimed that the reviewing auditor’s opinion was unqualified.
Falsification charge
Regarding the falsification charge that the Accused had pleaded guilty, the circumstances are as follows. On 14 March 2019, the Accused forwarded Tang’s audited FY2018 financial statements to her deputy, Patrick Vincent L Lau (“Lau”). She told Lau that the audited FY2018 statements contained a qualified opinion from PAC, and that if the financial institutions were to receive these statements, they might cease extending credit facilities to AIPL. The Accused therefore instructed Lau to copy the signature in the audited FY2018 financial statements and insert it into another document that falsely purported to be AIPL’s audited and consolidated financial statements for FY2018. This document contained false information on AIPL’s financial position (“falsified FY2018 financial statements”). Lau complied with the Accused’s instructions. He took a screenshot of Tang’s signature from the audited FY2018 financial statements, pasted the signature into the falsified FY2018 financial statements, and then sent the falsified statements to the Accused.
Cheating charges
Regarding the 11 cheating charges which the Accused had pleaded guilty, it is not disputed that from January 2017 to November 2019, the Accused had instructed and/or authorised her subordinates to forward AIPL’s falsified financial statements to 11 financial institutions. She knew that these institutions would rely on the statements to assess AIPL’s credit facilities. Believing that the falsified financial statements were audited and accurately represented AIPL’s financial position, these institutions were induced into granting credit facilities to AIPL. The total credit facility granted in the 11 proceeded cheating charges is US$477,699,977.65 (S$647,904,479.69). The total losses suffered by the relevant financial institutions are US$414,438,104.26 (S$562,102,400.81).
Ng’s whereabouts is currently unknown, and no other person has been prosecuted in connection with the Accused’s offences.
Sentencing submissions
Prosecution’s submissions
The Prosecution’s submissions for the Accused’s cheating charges are as follows. The key sentencing factors for cheating are harm and culpability. In this case, the harm caused by the Accused’s offences is “very severe”. Apart from huge financial losses suffered by her victims, the Accused’s offences had also undermined confidence in the financial and economic ecosystem, increased the business costs, and could cause financial institutions to withdraw trade financing services and thus affect legitimate businesses. The Accused’s culpability would ordinarily be classified as “high” for the following reasons. First, she had “flagrantly” abused her position as the CFO of AIPL by instructing and authorising her subordinates to forge signatures and send falsified documents to the relevant financial institutions. Second, there was “significant premeditation and planning” in that the Accused had initially sought to obstruct Tang’s audit by asking his boss, James, to manage his repeated requests for information and documents to carry out his work. Third, the offences were committed on more than 30 occasions over three years. Furthermore, the falsified financial statements were complex and detailed documents – only someone with intimate knowledge of the AIPL and had access to its documents (which were voluminous) could detect the statements to be false. The Prosecution accepted that there is no evidence that the Accused had committed the offences out of greed. As such, this warranted a “sentencing discount” and the Accused’s culpability ought to be pegged at “moderate”. According to the sentencing matrix in Public Prosecutor v Gene Chong Soon Hui [2018]...
