Director of automobile corporations who cheated banks will get jail in S$14m commerce financing case

SINGAPORE: A director of a number of automobile trade-related corporations ran a million-dollar scheme deceiving banks into issuing financing through the use of false documentation of transactions, leading to large losses by the banks.

Ho Yik Fuh, 57, was sentenced to fifteen years’ jail on Tuesday (Sep 13) for an assortment of prices together with dishonest and falsifying paperwork.

His confederate and provider, 61-year-old Yeo Kee Siah, was sentenced to 40 months’ jail for his position.

Each males had contested the costs and had been discovered responsible at shut of trial.

The courtroom heard that Ho ran Frankel Motor, Frankel Leasing and Supreme Motor, working a parallel import automobile retailing enterprise via these corporations.

Yeo was a director in Blue Motor Works, a provider of parallel imported automobiles to Ho’s Frankel group of corporations.

Ho had an association with Ho such that a lot of the automobiles imported into Singapore by Yeo had been parked at Frankel Motor’s storage services. The storekeeper of Frankel Motor would take over the automobiles and obtain one key for every automobile.

Beneath this association, regardless that Frankel Motor had not formally bought the automobiles, the corporate might provide the automobiles on the market to their prospects.

If the automobiles had been offered, Yeo would be told and earmark the automobiles in his data as having been booked by Frankel Motor. Yeo would situation invoices for the automobiles booked by Frankel Motor relying on whether or not any of the businesses within the Frankel group had out there credit score in its traces of financing with the banks.

To finance the Frankel group of corporations, Ho utilized for numerous loans from totally different banks and firms. Amongst these had been the Abroad Chinese language Banking Company (OCBC), VTB Financial institution Europe Plc, Financial institution of East Asia (BEA) and GE Cash.

To acquire financing from these banks, numerous paperwork needed to be submitted, together with paperwork exhibiting proof that automobiles had been delivered to one of many Frankel group’s corporations, or that the corporate needed to pay its provider for the automobiles.

Between 2006 and 2007, Ho and Yeo deceived banks into giving financing to the Frankel group of corporations for the acquisition of automobiles from numerous suppliers, when actually there have been no automobiles delivered in accordance with the invoices and supply notes supplied to the banks.

Ho deceived three banks through the use of double financing – getting financing twice for a similar items – and post-dated financing, through the use of paperwork exhibiting that the automobiles had been delivered on a sure date when actually they’d been delivered a while earlier than.

Yeo helped Ho by issuing paperwork to facilitate each sorts of financing.

“The fraud perpetrated on the three banks resulted in large losses, because the Frankel group of corporations went underneath and couldn’t make reimbursement of the excellent loans,” stated the prosecutor.

“The banks had been additionally disregarded of pocket, because the double financing and post-dated financing meant that the loans, which had been presupposed to have been secured by floating prices over the automobiles which ought to nonetheless have been throughout the property of the Frankel group of corporations, had been actually unsecured because the underlying automobiles had already been offered to end-buyers or had been already underneath different financing which took priority,” he stated.

The whole quantity in Ho’s prices is about S$14.2 million. Of this, Yeo’s involvement is at about S$3.5 million.

VTB was deceived into disbursing S$2.7 million, OCBC was cheated into disbursing S$1.09 million and BEA disbursed about S$659,000.

Ho additionally cheated Wirana Worldwide into coming into a financing association for Frankel Motor over non-existent imported automobiles. Losses of roughly S$9.7 million was prompted to Wirana Worldwide over 29 situations of financing.

The prosecutor stated the offences are a mirrored image of “a troubling, but persistent, local weather within the Singapore enterprise group the place commerce financing scams are seen as a handy approach to tide companies via cashflow issues”.