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A Singaporean oil trading company’s founder, whose enterprise collapsed under scandal, will face sentencing on Monday for cheating HSBC out of millions. This case, which ranks among Singapore’s gravest financial frauds, has highlighted the intricate methods used to exploit banking institutions and the systemic lapses that allowed such crimes to unfold.
Lim Oon Kuin, better known by the initials O.K. Lim, was convicted in May for his role in a fraudulent scheme that significantly damaged Singapore’s reputation as a leading Asian oil trading center.
Before its dramatic downfall in 2020, Hin Leong Trading stood as a powerhouse in Asia’s oil trading landscape, commanding significant influence across the region. Its sudden collapse marked a turning point in the industry, drawing attention to the opaque dealings that had fueled its rise.
Judge Toh Han Li of the State Courts was scheduled to deliver the sentencing for Lim Oon Kuin at 2:30 PM local time (0630 GMT) on Monday. Prosecutors, emphasizing the gravity of the case, are pushing for a 20-year prison sentence for the 81-year-old businessman.
In seeking a reduced sentence of seven years, Lim’s lawyers have highlighted his poor health and advanced age, portraying him as a man in decline. They have also sought to minimize the severity of the consequences stemming from his offences, challenging the prosecution’s assertions of widespread harm.
The businessman faced a total of 130 criminal charges involving hundreds of millions of dollars, but prosecutors tried and convicted him on just three — two of cheating HSBC, and a third of encouraging a Hin Leong executive to forge documents.
Prosecutors said he tricked HSBC into disbursing nearly $112 million by telling the bank that his firm had entered into oil sales contracts with two companies.
The transactions were, in fact, “complete fabrications, concocted on the accused’s directions”, prosecutors said, adding that his actions “tarnished Singapore’s hard-earned reputation as Asia’s leading oil trading hub”.
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Lim built Hin Leong from a single delivery truck shortly before Singapore became independent in 1965.
It grew into a major supplier of fuel used by ships, and its rise in some ways mirrored Singapore’s growth from a gritty port to an affluent financial hub.
The firm played a key role in helping the city-state become the world’s top ship refuelling port, observers say, and it expanded into ship chartering and management with a subsidiary that has a fleet of more than 150 vessels.
But it came crashing down in 2020 when the coronavirus pandemic plunged oil markets into unprecedented turmoil, exposing Hin Leong’s financial troubles, and Lim sought court protection from creditors.
In a bombshell affidavit seen by AFP in 2020, Lim revealed the oil trader had “in truth… not been making profits in the last few years” — despite having officially reported a healthy balance sheet in 2019.
He admitted that the firm he founded after emigrating from China had hidden $800 million in losses over the years, while it also owed almost $4 billion to banks.
Lim took responsibility for ordering the company not to report the losses and confessed it had sold off inventories that were supposed to backstop loans.
