Public Prosecutor v Yip Mun Keong
| Jurisdiction | Singapore |
| Judge | Hui Choon Kuen |
| Judgment Date | 08 April 2005 |
| Neutral Citation | [2005] SGDC 82 |
| Court | District Court (Singapore) |
| Published date | 03 May 2005 |
| Year | 2005 |
| Plaintiff Counsel | Peter Koy (Deputy Public Prosecutor) |
| Defendant Counsel | Chelva Rajah SC, Burton Chen, Chen Chee Yen (Tan Rajah and Cheah LLC) |
| Citation | [2005] SGDC 82 |
8 April 2005
District Judge Hui Choon Kuen:
The accused faced 87 charges of engaging in a conspiracy with one Wong Siow Hiong (“Wong”) (whom is also known as “Alvin”), one Saw Chee Keang (“Saw”) and one Lee Chew Seng (“Lee”) to cheat Malayan Banking Berhad (“Maybank”) or DBS Bank Ltd (“DBS”), as the case may be. A number of the charges did not include Lee as one of the members of the conspiracy. An additional charge was stood down and therefore did not form part of these proceedings. At the time of the trial, Saw was at large. Wong and Lee had been convicted for their involvement in the conspiracy after pleading guilty. At the end of the trial, I was satisfied that the prosecution had proven its case against the accused beyond reasonable doubt and convicted the accused on the 87 charges. I sentenced the accused to a total sentence of 54 months imprisonment. The prosecution withdrew the remaining charge pursuant to s 177 of the Criminal Procedure Code, Cap 68. I had given some brief grounds when delivering the verdict and sentence. The accused has appealed against both conviction and sentence. I now set out my full grounds.
Background facts
2 In April 1989, Saw started a company called Startech Electronics Pte Ltd. The company’s business and assets were then acquired in April 1994 by a company called Tenco Startech Pte Ltd. In August 1997, Tenco Startech Pte Ltd was acquired by the Pacific Vinitex Group and renamed PV Startech Pte Ltd (“PVS”). In 1999, PV Startech Holdings Pte Ltd was incorporated. The intention was to identify a number of profitable companies under the Pacific Vinitex Group and park them under PV Startech Holdings Pte Ltd. PV Startech Holdings Pte Ltd would then apply for public listing. Seven companies were identified and their ownership transferred (both directly and indirectly) to PV Startech Holdings Pte Ltd. They were as follows:
(i) PVS (later renamed as Startech Manufacturing Pte Ltd)
(ii) Hi-Tech Materials Pte Ltd
(iii) Switech Systems & Marketing Pte Ltd
(iv) PV Startech Marketing Limted
(v) Weinixing Electronics (Shenzhen) Co Ltd
(vi) Chemitec Industrial Pte Ltd
(vii) PV Power Pte Ltd
These seven companies thenceforth constituted the Startech Group. PV Startech Holdings Pte Ltd was publicly listed in July 2001 and the new public company was renamed Startech Electronics Ltd. PVS was renamed Startech Manufacturing Pte Ltd (“SMPL”) after the listing.
3 Saw became the Chairman and Chief Executive Officer of Startech Electronics Ltd. Lee, whom had first joined Startech Electronics Pte Ltd in 1991, became the Executive Director of PVS. Lee was also known as “Stan”. The accused joined PV Startech Holdings Pte Ltd in October 1999 as the Startech Group Financial Controller. He was hired to help plan the listing exercise, and he did so together with the bankers and lawyers. He was also involved in the negotiation with the banks for banking facilities and helped to bring in third parties to acquire a stake in the company. After the listing, he reviewed the financial numbers supplied by the accountants and prepared them for board meetings and the half-yearly reporting.
4 SMPL obtained a credit facility of $8 million in trade credit financing through trust receipts from Maybank on 28 March 2002. This was renewed on 10 March 2003. Under this facility, SMPL would submit a Trust Receipt Financing Application Form, signed by one of the authorized signatories, together with the supplier’s invoice. Upon approval, Maybank would disburse the amount stated in the application form to SMPL’s supplier. SMPL also obtained a $1 million Bills Receivable Purchase Financing Facility from DBS on 5 September 2002. Under this facility, SMPL would submit a Bills Receivable Purchase Financing Application Form, together with the supplier’s invoice and delivery order. Upon approval, DBS would disburse the amount stated in the application form to SMPL’s supplier. The accused was one of the authorized signatories for the application forms.
5 Wong was a car mechanic who had his own business called Wong Sie Motor Vehicle Repair Service (“Wong Sie”). He also owned two sole proprietorships called Dara Services and K2 Tech Components (“K2 Tech”).
The scheme to cheat
6 Sometime in August 1999, Saw approached Wong and asked him to participate in his scheme to cheat the banks. Wong was to allow fictitious invoices to be generated in the name of his Dara Services, for supposed sales of electronic components to PVS. Fictitious delivery orders would also be generated to evidence the supposed delivery of the components. PVS will then submit these false documents together with their application forms for trade credit financing to the banks pursuant to its trade financing facilities with them. When Wong received the ‘payment’ from the banks, he would then channel the monies to PVS, less about 0.3% as his commission. At the same time, PVS will generate a debit note showing rejection of the bulk of the electronic components supplied, hence justifying the ‘refund’ from Dara Services to PVS. In the latter part of the scheme, Wong used K2 Tech as the dummy supplier.
7 The banks had been cheated as they were deceived into believing that there was a genuine sale and purchase of electronic components from Dara Services or K2 Tech to SMPL. They would not have disbursed the monies if they had known that there was no real sale and delivery of goods and that the supporting documents were false. The 87 charges in these proceedings arose from such 87 false applications for trade financing to the banks.
The issue
8 The defence does not dispute that Wong, Saw and Lee had been involved in a conspiracy to cheat the banks, in the manner set out above. The defence also does not dispute that the accused had signed the 87 application forms, and that the supporting documents as well as the underlying transactions were false.
9 What is disputed by the defence, is that the accused had knowledge of the scheme. The defence’s position was that the accused had signed the application forms, believing the supporting documents and underlying transactions to be genuine. The only issue therefore was whether the accused was a member of the conspiracy. Accordingly, the prosecution’s burden was to prove beyond reasonable doubt, that the accused was a member of the conspiracy outlined earlier.
The law on abetment by conspiracy
10 It is well-established that the courts recognizes that the essence of a conspiracy is agreement and in most cases the actual agreement will take place in private in such circumstances that direct evidence of it will rarely be available. One method of proving a conspiracy would be to show that the words and actions of the parties indicate their concert in pursuit of a common object or design, giving rise to the inference that their actions must have been coordinated by arrangement beforehand. These actions and words do not of themselves constitute the conspiracy but rather constitute evidence of the conspiracy. In addition, there need not be communication between each and every conspirator, provided that there was a common design, common to each of them. What is essential is that there must be knowledge of a common design, and it is not necessary that all the co-conspirators should be equally informed as to the details. (see Lim Teck Chye v PP
The evidence
11 Turning to the evidence, I noted that there was nothing on the face of the documents attached to the 87 application forms that would indicate that the accused knew that the transactions were false. This is not unexpected, as the documents had to look genuine in the first place in order to deceive the banks into believing that they were legitimate. In fact, one of the prosecution witnesses, Stephanie Chung (“Stephanie”), gave evidence as to how the fictitious components listed in the invoices were taken from a Bill of Materials and ‘rotated’ each time so that the same items would not appear in successive invoices. The quantities of the items were also deliberately stated as irregular numbers to further add to the appearance of legitimacy.
12 While a visual comparison of the invoices of Dara Services and K2 Tech reveals that both companies share the same address, telephone and fax numbers, and the “authorized signatures” were similar, there was however no evidence that the accused had occasion to compare invoices from the two different companies. I disagreed with the prosecution’s submissions on this point and it is my view that it would be unreasonable to expect a signatory in the accused’s position to note that the company details and the signatures on the invoices from both companies were the same. The prosecution was unable to rebut the accused’s explanation that he did not notice this fact as he usually concentrated on checking whether the goods had been received by SMPL and whether the quantity and value of the invoiced items tallied with the delivery order and the application form.
13 Accordingly, the prosecution’s evidence centred on the oral evidence of two prosecution witnesses: Wong and Stephanie. While the cautious approach expounded in Kwan Peng Hong v PP
PW1- Wong’s evidence
14 Wong did not give any direct evidence of an actual agreement between the accused and himself or any other members of the conspiracy. His evidence was that he was recruited by Saw to take part in the scheme, and that he mainly dealt with Saw and Stephanie in the course of the performance of his role in the scheme. His main role was to provide the blank Dara Services/K2 Tech letterheads to Stephanie and to channel the funds to SMPL when he had received them from the banks. However, he gave...
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