Bedok resident behind 185 companies; nine are linked to billion-dollar money laundering bust

The listing of a Singapore resident as director, secretary and shareholder of 185 companies here has sparked concerns, after it emerged that several of the firms were linked to three of the 10 money laundering suspects arrested on Aug 15.

Experts say it is not possible for an individual to be involved in so many companies, adding that such appointments should raise a red flag.

Foreigners without a Singpass must engage a registered filing agent such as a law firm, an accounting practice or a corporate secretarial company to submit applications on their behalf.

All agents are required to carry out a due diligence check on their clients’ source of wealth and funds.

Bedok resident JJ, who runs a firm which provides secretarial services, was previously appointed as director, secretary or shareholder of 224 companies, including those involved in investment, technology, consultancy and pharmaceutical trade.

A third of the companies have been struck off.

Of the 185 companies that are still active, nine list Su Haijin, Su Baolin and Vang Shuiming, who is also known as Wang Shuiming, as director or shareholder.

The three foreign nationals originally from China were charged in court with various offences including money laundering, forgery and resisting arrest. They were arrested by police during the Aug 15 money laundering blitz.

Accounting and Corporate Regulatory Authority (Acra) records showed that JJ was appointed director, secretary or shareholder of the same nine companies.

JJ’s name appeared more than once in two of the companies, which means that he held multiple positions in these firms.

The 41-year-old was not at his Housing Board (HDB) flat in Bedok when The Straits Times checked on Aug 23. In a call to ST later that night, he said that he was in business with one of the suspects.

“He got me to invest in his company. He asked me to take care of his company. But I have never taken a single cent or shares.

“Not a single cent of the director’s fee, and not a single cent of an employee’s salary,” said JJ in Mandarin, who added that he will make a police report because he received nothing in return.

The naturalised Singaporean, who moved here from Shanghai when he was in his 20s, said he had contacted the individual a week before the islandwide raids, adding: “I showed him how much he owed me, but he told me he wasn’t able to pay me back.”

“But when I read the news of his arrest, I saw that the police had seized cash from him. So I suspect he had the money but did not want to return what he owed me. I am a victim here,” JJ added.

When asked about his involvement with around 400 companies since 2014, JJ said: “So what if I’m involved in all these companies? I do secretarial work for companies and they are all legitimate. I’m not doing anything wrong.”

He added: “I live in an HDB flat and drive a second-hand car, which I took out a loan for.”

JJ said that he was introduced to the individual by Su Haijin, whom he denied having any business connections with.

However, ST found that JJ holds secretarial positions in Yihao Cyber Technologies, Daily Glory International, and Aiqinhai Investment, three firms where Su was listed as a director.

Su Haijin was also a shareholder in Meining (Asia) International Electronic Commerce and Sg-Gree, firms where JJ was appointed as director.

He is also the listed secretary of Singapore company Zhuo Chi Technology, linking him to Vang Shuiming.

Red flags

Professor Mak Yuen Teen, professor (practice) of accounting and former vice dean of the National University of Singapore (NUS) Business School, said it is not unusual for one to have many companies tagged to his name, if he provides corporate secretarial services.

These individuals act as the secretary to many different companies, and they are in charge of ensuring the company’s annual returns are filed on time, among other responsibilities.

However, it could be a “red flag” for someone to hold directorial and secretarial roles in almost 200 companies at one go, added Prof Mak.

Associate professor of finance Hu Jianfeng said it is unusual for an individual to be appointed in executive roles in many companies.

The exception is when they are appointed as nominee directors, who can have positions in multiple companies without being involved in daily operations.

“However, even nominee directors are still responsible for compliance and that increases the risk and cost of (holding such a role).

“Therefore, it is also not common to see nominee directors taking positions in hundreds of firms,” added Prof Hu, who is with the Singapore Management University.

NUS business school professor Lawrence Loh said: “It is humanly impossible to commit to being the director and secretary of so many companies, let alone almost 200 at once.”

Prof Loh said there are no legal restrictions on how many companies a person can be involved in, but added that having roles in a large number of companies means “a web of possibilities to move resources, which would then make tracking and monitoring tougher”.

Prof Hu suggested that the purpose of having multiple companies is to move money around, which makes it difficult for regulators to trace the source of funds.

“Unlike interpersonal money transfers, intercompany transfers do not tell you who are the ultimate beneficiaries directly. You need to look into the company’s ownership to find out,” he added.

Proposed limits

Responding to ST’s queries, Acra acknowledged that it is not common for individuals to hold numerous directorships in Singapore, but added that there are currently no caps.

A spokesman said the business registry is working on amendments to the Companies Act and Acra Act, to limit the number of nominee directorships that an individual can hold.

The Bill, which is expected to be tabled in Parliament in 2024, could also see an increase in the financial penalties on corporate service providers for breaches to do with money laundering and terrorism financing.

In this regard, Acra noted that Singapore adopts a whole-of-government approach to combat illicit activities such as money laundering and terrorism financing, “with various agencies playing distinct roles in ensuring Singapore’s status as a trusted financial and business centre”.

The business registry said it proactively identifies, monitors and strikes off inactive companies.

“Acra leverages data analytics tools to identify individuals likely to be nominee directors of companies that may be used to conduct improper activities and carries out in-depth reviews and checks on higher-risk individuals,” said the spokesman, who added that they have acted against errant corporate service providers.

“All directors, regardless of the number of directorships held, are required to discharge their duties responsibly, with honesty and reasonable diligence.

“Those who fail to do so can face enforcement actions, including disqualification and debarment,” the spokesman said.