Public Prosecutor v Teo Cheng Kiat

• Jurisdiction: Singapore
• Judge: Tay Yong Kwang JC
• Judgment Date: 06 July 2000
• Neutral Citation: [2000] SGHC 129
• Court: High Court (Singapore)
• Published date: 12 March 2013
• Year: 2000
• Plaintiff Counsel: Lawrence Ang and Jeanne Lee (Attorney-General's Chambers)
• Defendant Counsel: Kevin De Souza (De Souza & Sahagar) (briefed)
• Citation: [2000] SGHC 129

JUDGMENT:

Grounds of Decision

1 The Accused, Teo Cheng Kiat, is a 47 year old former employee of Singapore Airlines Ltd ("SIA"). He joined SIA in May 1975 as a clerk and from 1 September 1988 until his dismissal early this year, he was a Supervisor in the Cabin Crew Division, Administration Services Department, drawing a monthly salary of almost $3,000. He pleaded guilty to 10 Charges of criminal breach of trust ("CBT") under Section 408 Penal Code. 15 other similar Charges and one Charge under Section 43A of the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act were admitted by him and taken into consideration for the purpose of sentencing.

2 The CBT Charges stated that he was entrusted with dominion over SIAs funds for the purpose of making allowance payments to the airlines cabin crew and was vested with the authority to process and cause payments to be made in respect of such allowances. They alleged that he dishonestly misappropriated numerous amounts from the airlines bank account with Overseas Union Bank Ltd ("OUB") by causing them to be paid to bank accounts which were in his name or controlled by him. The bank accounts which were controlled by the Accused included a joint account in the names of the Accused and his wife, Tan Lay Bee, one in the names of his wife and her sister, Tan Leh Kheng and one account in the name of his wife. The 25 CBT Charges covered a time span of 13 years from February 1987 to January 2000 and involved a total sum of $34,955.064.55. The 10 CBT Charges on which the Accused was convicted involved a total sum of $31,019,452.10. The only non-CBT Charge related to an offence of concealing property directly representing benefits from criminal conduct.

3 The airlines procedure for processing allowance payments and the manner in which the Accused exploited the system are set out with admirable precision and clarity by the Prosecution in the Statement of Facts. Briefly, the Accused as Supervisor was responsible for the data processing operations of his four subordinates so that allowances for the airlines cabin crew could be paid on time. The Accused was given access and was authorised to make adjustments to the Cabin Crew Allowance System. He could determine the name of the crew member who was to be paid, the amount payable and the receiving bank account number. A particular type of allowance (the Meal and Overnight Allowance), which was tax-free and payable only to cabin crew, was processed and paid directly to the cabin crew by the Accuseds department. Each crew member maintained a bank account with OUB and the money paid would be transferred by the Bank from the airlines account to the respective crew members account directly.

4 The Accuseds work was supposed to be checked and verified by the Accuseds two immediate supervisors but as the reports were voluminous, it was impractical to check all the payments. Random checks were expected to be made. However, even if checks had been made, there was no way the supervisors could verify all the details keyed in by the Accused.

5 The Accused controlled eight accounts in OUB at the material times. They were either personal accounts in his name or in his wifes name or joint-accounts in the names of the Accused and his wife or of his wife and her younger sister. The Accused credited into these eight accounts the money misappropriated from SIA.

6 By creating fictitious adjustments for extra payments of allowances, the Accused was able to siphon off money into the accounts controlled by him. As the cabin crew to whom the allowances were due were also paid, there was no complaint. While the Accused was on leave, no adjustments would be made until his return as he was the only one authorised to make the adjustments.

7 To avoid detection, the Accused doctored a computer-generated report printed daily which contained all the adjustments made to crew allowances for that day. The doctored report would not reflect the fictitious adjustments made, the total number of adjustments made or the total amount involved in the adjustments.

8 Upon receiving the payment instructions from SIA, OUB would credit the amounts stated into the receiving bank account numbers. The relevant information for payment was the receiving bank account number and not the name of the cabin crew in question.

9 Using the above method, the Accused systematically channelled money into his OUB accounts. From there, he moved it to his accounts in other banks before spending it. With the misappropriated money, he bought seven private properties, including the house he was living in. Two of them have been fully paid for. He spent some $280,000 on renovations for two of the apartments. He also purchased a Mercedes Benz C 200 for $180,000 and a BMW 728 iA for $270,570. He spent another $1.85 million on jewellery and watches. He also patronised high fashion boutiques.

10 In Malaysia, which the Accused travelled to once a month on average in 1998 and where he stayed in a posh hotel each time, he has paid RM1.5 million for an apartment in Kuala Lumpur, RM750,000 for a Mercedes Benz CLK 320 and a deposit of RM90,000 for a Mercedes Benz S 320.

11 On 18 January 2000, one of the staff in the Internal Audit Department did an adhoc review of the data on the crew allowance payments and noticed that three OUB bank accounts (the Accuseds) received ten payments each on 15 December 1999. This was unusual as there should be only one payment of allowance to any crew member on a particular day. A police report was lodged on 19 January 2000 setting off the train of investigations leading to the present case.

THE PROSECUTIONS SUBMISSIONS ON SENTENCE

12 The Accused has no previous convictions. The Prosecution, however, urged me to pass a deterrent sentence by way of a substantial period of imprisonment. Of the almost $35 million embezzled, the Commercial Affairs Department ("CAD") was able to recover about $15 million in cash. The seven properties and the luxury items would probably yield another $6 million or so. That left some $14 million unaccounted for. The recovery of these assets came about because of the quick and decisive action taken by the CAD and was not due to voluntary restitution by the Accused.

13 The CAD had in its possession overwhelming documentary evidence against the Accused and would therefore have had little difficulty proving the charges against the Accused. His plea of guilt should not therefore be the dominant consideration in deciding on the sentence to be imposed.

14 The misappropriation in this case was systematic and calculated and was done almost every day for 13 years. It was done simply through greed and a desire to support an extravagant lifestyle. There was sophistication and planning. The Accused was placed in a position of considerable trust.

15 The High Court has unfettered sentencing powers save that it cannot impose the three punishments of imprisonment, fine and caning for one offence (Section 11(1) Criminal Procedure Code). While Section 17 Criminal Procedure Code restricts...