By Andrea Tan and Alfred Cang
(Bloomberg) -- The downfall of storied Singapore oil trader Lim Oon Kuin reached a new nadir Friday, with the founder of Hin Leong (Pte) Ltd. charged with abetment of forgery for the purpose of cheating, punishable by up to 10 years in prison.
The charge, which arose from investigations by Singapore’s Commercial Affairs Department into Hin Leong, relates to Lim’s instigation of an employee to forge a document purportedly issued by an affiliated oil-storage company known as Universal Terminal, according to a charge sheet seen by Bloomberg.
Known to many as OK Lim, the founder of Hin Leong has been in the spotlight after the company was accused of hiding more than US$800 million in losses and leaving 23 banks on the hook for US$3.5 billion in liabilities. In previous court filings and affidavits, it’s been alleged that Hin Leong also illegally sold millions of barrels of oil it was using as collateral for bank loans.
According to the charge sheet, the forged document stated that Hin Leong had transferred more than a million barrels of gasoil -- or diesel -- to another company, China Aviation Oil (Singapore) Corporation Ltd. The same document was allegedly used to secure over US$56 million in trade financing from a financial institution.
Bail has been set at S$3 million (US$2.2 million). The offense of abetment of forgery for the purpose of cheating carries a punishment of up to 10 years in prison and a fine. The Straits Times first reported the charge.
The next hearing in the case is scheduled for September 25. Investigations into other offenses allegedly committed by Lim are ongoing.
Lim’s family lawyers at Davinder Singh Chambers LLC and the Singapore Police Force couldn’t immediately comment on the matter when contacted. Emails to Hin Leong and Xihe Holdings (Pte) Ltd., a shipowner linked to the Lim family, went unanswered. Nobody answered calls to China Aviation Oil’s office in Singapore.
Singapore’s tight-knit trading community has been simultaneously shocked and fascinated by the fall of one of country’s most fabled success stories.
Lim started from humble beginnings, supplying diesel from a fishing boat to other vessels. He was one of the first traders outside China to start doing business with the mainland in the 1980s, and when its economic growth accelerated Hin Leong became a giant of the industry, an empire with stakes in an oil terminal and tanks capable of holding millions of barrels of oil.
Singapore is the world’s biggest hub for shipping fuel, and the trading house’s bunkering unit was the third-largest supplier there last year, according to the Maritime and Port Authority.
The crisis is the latest in a series of scandals to tarnish the reputation of the island-state, including multi-million dollar losses by some high profile Chinese and Japanese traders, the collapse of Noble Group, one of the biggest names in the industry, and the more recent implosion of Agritrade International.
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