Public Prosecutor v Tan Koon Swan

• Jurisdiction: Singapore
• Judge: Lai Kew Chai J
• Judgment Date: 26 August 1986
• Neutral Citation: [1986] SGHC 32
• Date: 26 August 1986
• Subject Matter: Plea of guilty,Property,s 157(1) Companies Act (Cap 185, 1970 Ed),Criminal breach of trust by director of public and listed company,Aided and abetted by accused,Two years' imprisonment and fine of $500,000,Abetment of criminal breach of trust,Principles,ss 109 & 406 Penal Code (Cap 103, 1970 Ed),Directors,Criminal breach of trust,Companies,Directors' duties,Sentencing,Offences,Abetment,Criminal Procedure and Sentencing,Custodial sentence necessary in public interest and as deterrent measure,ss 177(1) & 223 Criminal Procedure Code (Cap 113, 1970 Ed),Criminal Law,Accused a political figure
• Docket Number: Criminal Case No 25 of 1986
• Published date: 19 September 2003
• Defendant Counsel: Ng Kong Yeam,Peter Yap (Peter Yap & Co)
• Court: High Court (Singapore)
• Plaintiff Counsel: Glenn Knight and Eleanor Wong (Deputy Public Prosecutor)

The accused pleaded guilty to a charge of abetting one Tan Kok Liang in committing a criminal breach of trust which offence is punishable under s 109 read with s 406 of the Penal Code. The punishment prescribed by law is imprisonment for a term which may extend to three years, or a fine, or both. Under s 406 no sum is expressed to which the fine may extend. Accordingly, under s 223(a) of the Criminal Procedure Code (the CPC) the amount of the fine is `unlimited but shall not be excessive`.

The charge reads as follows:

You, Tan Koon Swan are charged that you on or about 11 September 1985 in Singapore abetted one Tan Kok Liang, a director of Pan-Electric Industries Ltd (the company) in the commission of the offence of Criminal Breach of Trust in that you engaged with him in a conspiracy to dishonestly dispose of property belonging to the company, namely its funds, over which he had dominion and which he did so dispose of in violation of s 157(1) of the Companies Act (1985 Reprint) a direction of law which prescribed that he was to dispose of such property honestly which he did not, and this he did when he authorised or arranged for the company to pay a sum of S$144,852.68 comprised in CB Cheque No 750813 belonging to the company for the acquisition of Grand United Holdings Bhd securities by Orchard Hotel (S) Pte Ltd a subsidiary of the company, which act was committed in consequence of your abetment, and thereby committed an offence punishable under s 109 read with s 406 of the Penal Code (Cap 103).

According to the statement of facts, which was admitted by the accused, the accused had played a significant and central part in forward contracts and the financing thereof which brought about the demise of the Pan-Electric Group. He, in effect, admitted that he had conspired with Tan Kok Liang and had made use of the resources of the group. It is also clear that, as a necessary part of the conspiracy, the accused had engaged in price support schemes so that forward contracts could be extended or rolled-over and could be financed by the banking system. It was in connection with one such support scheme that the dishonest misappropriation was committed by Tan Kok Liang to pay the accrued interest charges to a firm of stock-brokers.

In the context of considering what has been set out in the statement of facts and what has been admitted by the accused, the following matters must be noted:

(a) the accused has pleaded guilty to and had been convicted of the offence of abetment of a particular breach of trust;

(b) the prescribed punishment for the offence is imprisonment for a term which may extend to three years, or a fine, or both such imprisonment and fine;

(c) the offence in this case relates only to a relatively minor aspect of what is, as revealed by the statement of facts, a much wider and rather more complicated mosaic of facts, including alleged criminal wrong-doings, in respect of which there have been no convictions;

(d) the accused has not been convicted of any other offence arising out of or in connection with the facts and circumstances referred to in the statement of facts; and

(e) in considering the sentence in this case no other charges are taken into account with the consent of the accused under s 177(1) of the CPC.

Accordingly, it has to be noted in all the circumstances of the case that the only sentence which this court can mete out is a sentence for the offence for which the accused has been convicted before it. Looking at the offence, the accused had engaged with one Tan Kok Liang in a conspiracy to dishonestly dispose of the sum of S$144,852.68 of Pan-Electric Industries (hereinafter referred to as Pan-El). As a result of the conspiracy Tan Kok Liang violated s 157(1) of the Companies Act and dishonestly paid out the money of the company to a firm of stock-brokers. He was aided and abetted by the accused.

So far as the commercial matrix in which the offence was committed is concerned, this may be stated within a reasonably short compass. In November 1984 the accused held or had contracted to take delivery of a total of 34m shares in Grand United Holdings Berhad (hereinafter referred to as GUH), a publicly listed company in which the accused was the substantial shareholder. He had to complete and pay for a block of such shares by 19 November 1984. Having failed to arrange the necessary financing because, as he claimed, he was deeply involved in a crisis which had embroiled his political party, Malaysian Chinese Association, he sought `expedient help`. Through two friends, he was introduced to one Peter Tham who, in addition to being the Managing Director of a stockbroking firm known as Associated Asian Securities Ltd (hereinafter referred to as AAS), was a substantial shareholder of Pan-El and Growth Industrial Holdings Limited (hereinafter referred to as `GIH`) which were at all material times also publicly listed companies. They met on or about 14 November 1984. What had been agreed between the accused and Peter Tham as a result of that meeting and what had transpired thereafter no doubt prompted counsel for the accused to describe it as a `fatal meeting`.

As a result of that meeting, Peter Tham agreed to buy from the accused the 34m GUH shares at $1.75 per share or at the total cost of $59.5m. It has to be emphasised that on 13 November 1984 GUH shares were transacted in the market at about $1.34 per share. If Peter Tham had entered into the transaction on his own account he would have suffered the colossal loss of some $13.9m.

Peter Tham instead decided to make use of the resources of Pan-El and GIH, the two publicly listed companies at his disposal, to purchase the 34 million GUH shares from the accused. Peter...