SINGAPORE - Hin Leong founder Lim Oon Kuin has been convicted of two cheating charges and one count of instigating forgery for the purpose of cheating in what prosecutors have described as “one of the world’s largest collapses of an oil trading firm”.
Prosecutors alleged that 16 banks in Singapore suffered US$291.9 million (S$395 million) in actual monetary losses out of the US$2.7 billion in loans they were duped into extending to Hin Leong by Lim. The losses are part of the alleged US$3.5 billion debt owed by the now-defunct oil trader to 23 banks.
On May 10, State Courts judge Toh Han Li found the 81-year-old former oil tycoon guilty of three charges that proceeded to trial out of a total of 130 criminal charges. The remaining 127 charges were stood down and will be dealt with at a later stage.
Lim’s sentencing is scheduled for Oct 3 and his bail of $4 million has been extended until then.
He faces a jail term of up to 10 years and will also be liable to a fine for each charge of cheating and forgery.
Lim, better known as O.K. Lim, declined comment when approached by The Straits Times after the verdict was handed down on May 10.
Lim was found guilty of cheating HSBC, through his employees, by claiming that Hin Leong had entered into two contracts to sell oil to China Aviation Oil (Singapore), or CAO, and Unipec Singapore, and then applying for discounting of these purported transactions.
The court found that the two transactions were complete fabrications, concocted on Lim’s directions, and the discounting applications were supported by forged or fabricated documentation.
As a result, the bank was deceived into disbursing US$111.6 million to Hin Leong, the judge said.
“For both cheating charges, there was dishonest intent” on Lim’s part, the judge said, noting that Lim “himself had recognised that it was ‘not correct’ to submit documents for discounting if it was not a done deal and there were no goods inside”.
Judge Toh found that Lim’s claims that he had slowed down since 2010, and gradually handed work to people he trusted, “did not accord” with evidence given by witnesses, including Hin Leong’s general manager for trading Wong See Meng and Peter Li Yue, the team leader of Unipec’s gas oil team in 2019.
“I find that until the time he stepped down on April 17, 2020, (Lim) continued to be the ‘big boss’ of Hin Leong... and continued to instruct, conduct and negotiate selected trades himself,” the judge said.
Lim was also accused of instructing Hin Leong’s former contracts executive Freddy Tan to create the documents for the bogus CAO transaction and to send them to the banker department, which handled discounting applications by Hin Leong to the banks.
In his statements to the Commercial Affairs Department (CAD) in June and August 2020, Mr Tan implicated Lim as the one who gave him these instructions. But in May 2023, Mr Tan changed his position and testified in court that Lim’s former personal assistant Serene Seng had given him the instructions.
The judge found this aspect of his court testimony to be “materially inconsistent with his statements to the CAD in 2020”, and ruled that Mr Tan is “impeached on this point”.
“If I had accepted the defence’s contention that Freddy Tan had reason to shield Serene Seng from being implicated in his CAD statements in 2020 because he ‘had her back’, it was quite inexplicable that he would then ‘out’ her in court by implicating her,” he said.
On whether Lim or Madam Seng gave instructions to Mr Tan to create the forged documents, the judge found it “quite unfathomable as to why Serene Seng would embark on such a course of conduct”, when there was no pending negotiation with CAO or discussion with Lim on such a deal.
While Madam Seng may have liaised with the banks, “this is completely different from her originating a fictitious deal and trade terms for the purposes of discounting when it was clear that she had nothing to personally gain by such... conduct”, the judge said.
On whether Lim told her to discount the Unipec transaction first, as opposed to simply being “mentally prepared”, the judge accepted Madam Seng’s evidence in court that Lim had given her the instructions to discount the transaction without there being any contract.
The judge said that “it is quite unfathomable that she would take things further of her own accord and proceed to submit the discounting application to HSBC without waiting for the deal between Hin Leong and Unipec to be concluded”.
But Judge Toh said he accepted that Madam Seng “did not give a complete account of what transpired in her statements to the CAD”, or in her documents filed for a High Court civil suit.
He noted that Madam Seng’s evidence in court “while implicating Lim, also implicated herself for the criminal offence of cheating, and was at the same time, damaging to her position in the High Court civil suit”.
Lim, his two children and Madam Seng are being sued by HSBC in the High Court for US$85.3 million in damages.
Lim and his two children are also being sued by Hin Leong’s liquidators over US$3.5 billion in alleged debt. Both cases are being jointly heard in an ongoing civil trial in the High Court.
