Jail for ex-directors of corporate service provider who incorporated 109 firms to launder scam funds
About 16 of the companies received more than US$14.6 million in fraudulent funds from victims in multiple countries
[SINGAPORE] Two former directors of a corporate service provider who incorporated firms for money laundering were each sentenced to 10 months of jail for offences against the Companies Act, the Singapore Police Force said on Wednesday (Dec 17).
The individuals, Lee Chia Yen and Lee Ay Ling, were convicted over eight counts of abetting nominee directors to violate the Companies Act and were barred from holding directorships for five years.
The duo operated Interconnect Consultancy, a corporate service provider that had recruited two locals as directors to satisfy Singapore’s regulatory requirement for local resident directors.
Between June and September 2020, the duo also incorporated 109 companies in Singapore for their overseas clients, which were subsequently used by unknown actors to launder proceeds from scams targeting overseas victims.
About 16 of the 109 companies received more than US$14.6 million in fraudulent funds from victims across multiple countries, including the US, Belgium, Chile and Singapore. The funds originated from sophisticated business e-mail compromise scams, whereby criminals impersonate company executives to authorise fraudulent wire transfers.
The duo used online advertisements offering easy income to recruit Singaporeans willing to act as nominee directors, the police said. They also deliberately structured the arrangements to ensure that the local directors remained uninformed about the companies’ business and operations.
The authority pointed out that they knew that this would cause the nominee directors to breach their duties, particularly when the companies received criminal proceeds.
“By doing so, they intentionally aided and abetted these directors in the dereliction of their director’s duties,” it said.
The authority noted that individuals should not be the director of a company when they have limited or no oversight or control of the company.
Directors who fail to exercise “reasonable diligence in the discharge of their duties” risk allowing their companies to facilitate the retention of benefits derived from criminal conduct, it added.
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