Offshore Banking / Money Laundering

Standard

* Thanks to a reader for submitting this blog post topic.

1. WHAT IS MONEY LAUNDERING and HOW DOES IT WORK?

According to Investopedia:

[An offshore bank is] located or based outside of one’s national boundaries. A company may legitimately move offshore for the purpose of tax avoidance or to enjoy relaxed regulations. Offshore financial institutions can also be used for illicit purposes such as money laundering and tax evasion.

According to legal-dictionary, money laundering “allows criminals to transform illegally obtained gain into seemingly legitimate funds.”

money_laundering

Money Laundering is the process of taking ‘dirty’ funds and converting it into ‘clean’ funds | Image from KYC Map

According to A Beginner’s Guide To Money Laundering:

Let’s say you [want] to hide a massive bribe. First, you must convert it into another currency without the government knowing. The easiest way to do this is to contact [an agent] who will give you casino chips for your cash, minus fees of up to 20%.

Take the chips to a friendly, cooperative casino, or, for extra safety, take them to a lawyer specializing in offshore laundering. Meanwhile, the casino will mix your chips with those from legitimate gamblers, and its accountants will book your $1 million as paid-out winnings.

Your bank or lawyer must wire-transfer the funds in such a way that the money crosses multiple borders, to frustrate detection or confiscation. For instance, the money might end up in a US trust managed by a shell company in Grand Cayman, owned by another trust in Guernsey with an account in Luxembourg managed by a Swiss or Caribbean or Singaporean banker who doesn’t know who the owner is.

2. “CORRUPTION” and PORTCULLIS TRUSTNET

As concerns grow about the wealth of corporate oligarchs, government officials and their families, some Chinese have braved the government’s anger by raising questions about corruption.

“How can you fight corruption if you don’t even dare to disclose your personal assets?” New Citizens Movement’s founder, legal advocate and activist Xu Zhiyong, wrote last spring.

The government arrested Xu and detained more than 20 other members of the group, indicting some for “disturbing public order” or “illegal assembly,” charges frequently used to silence dissidents.

The files [from this report] come from two offshore firms — Singapore-based Portcullis TrustNet and BVI-based Commonwealth Trust Limited — that help clients create offshore companies, trusts and bank accounts.

Source: Leaked Records Reveal Offshore Holdings of China’s Elite

3. MONEY LAUNDERING IN SINGAPORE

ICIJ is an investigative journalism website which focuses on issues like cross-border crime, corruption, and the accountability of power.

singapore-banking

Singapore Skyline Banking District

From one of their articles on offshore banking in Singapore:

More than 100 customer consultants at Deutsche Bank Singapore helped create or manage 309 offshore entities for its customers in the British Virgin Islands and other tax havens, according to secret records obtained by the news organizations.

Most of the companies carry fantasy names like “Thrilling Returns Incorporated,” “Amazing Opportunity Limited” or “Market Dollar Group Limited.” Public sources don’t show any business activities for most of these companies. Deutsche Bank registered the entities with the help of Portcullis TrustNet, an offshore services provider headquartered in Singapore.

Deutsche Bank’s private banking operations ranked No. 6 among the world’s largest private banks, increasing their assets under management from $180 billion in 2005 to $367 billion in 2010.

Source: ICIJ

From John Harding’s website [John Harding was the former Deputy Assistant Commissioner for Singapore’s Inland Revenue Department (IRAS)]:

Yeo Cheow Tong is a member of the investment team of Tembusu Partners. Yeo was given his retirement pay in a lump sum in order to pay off his debts to bankers and not embarrass the Singapore government.

The Trembusa fund has been awarded Pioneer Status with zero-rated tax incentive for both the fund and the fund management company. The fund has also qualified under the Global Investor Programme by EDB, where foreign investors with S$1.5 million investment into the fund may apply for Permanent Resident Status in Singapore.

limhweehwa

Lim Hwee Hwa: Former Minister and current director at Tembusu Partners.

Andy Lim, who also runs Money World, has been banned from entering China due to money laundering activities of his firm. He has also been charged in court in the Fiji Islands. And here is the BIG CONNECTION with the Singapore Government that is making it all happen. Andy Lim’s wife is Lim Hwee Hua (former minister). Lim Hwee Hua was making nearly four times as much as President Obama, but this is not enough for the crooked lady. She has set up her husband, Andy, to run a scam investment company, where, as an investor, you can get residence in Singapore.

P.S. Lim Hwee Hua is currently a director at Tembusu Partners.

Source: YeoCheowTong.com

On an art scandal that could expose mass fraud in the global art market:

Lawyers and art dealers familiar with the discussions say the case could expand well beyond Bouvier and reach into the top galleries and billionaire collectors in New York, London and Hong Kong. It could widen to involve not only undisclosed mark-ups by dealers, but also tax fraud, global money laundering and possible bribery. 

“This is just the beginning,” said one prominent art lawyer in New York who asked not to be named. “There will be a lot of big dealers and collectors involved.”

Source: CNBC

On 1MDB bank accounts:

Singapore police have started investigations into money laundering on two bank accounts linked to 1Malaysia Development Bhd (1MDB) in the island republic. Earlier this year, MAS said it was in touch with Malaysian regulators after Putrajaya said 1MDB had redeemed US$1.1 billion from the Cayman Islands and parked it in the Singapore unit of Swiss private bank BSI.

Source: The Malaysian Insider

4. SINGAPOREANS in ICIJ’S “OFFSHORE LEAKS”

This is a list of names from Singapore who have offshore companies and trusts.

One is former army general, LT-Gen Ng Jui Ping.

ngjuiping

LT-Gen Ng Jui Ping: Offshore Leaks Database. Offshore Service Provider: Portcullis Trustnet (refer to Sections 2 & 3 above).

5. SINGAPORE & BURMA GOVERNMENT

a) For its part, Temasek does not respond to questions about its activities in Burma.

A Singaporean diplomat to Burma, Matthew Sim, says “many successful Myanmar businessmen have opened shell companies” in Singapore “with little or no staff, used to keep funds overseas.”

Sim may be referring to junta cronies such as Tay Za and the druglord Lo Hsing Han. Lo controls a heroin empire and one of Burma’s biggest companies, Asia World, which the US Drug Enforcement Agency describes as a front for his drug trafficking.

lohsinghan

Lo Hsing Han or Law Sit Han (1935 – 2013): Burmese drug trafficker and major business tycoon.

Singapore is the Lo family’s window to the world, a base for controlling several companies. Lo’s son Steven, who has been denied a visa to the US because of his drug links, is married to a Singaporean, Cecilia Ng. A former US assistant secretary of state for the Bureau of International Narcotics and Law Enforcement Affairs, Robert Gelbard, has said half of Singapore’s investment in Burma has been “tied to the family of narco-trafficker Lo Hsing Han.”

Dissident groups say the trade-off for Tay Za’s government business contracts in Burma is to fund junta leaders’ medical trips to Singapore.

Source: Sydney Morning Herald

b) Jelson Garcia, Asia Program Manager with the Banking Information Center (BIC), said World Bank, ADB and International Monetary Fund (IMF) officials informed him last year that Burma’s government held up to $11 billion in several Singaporean bank accounts.

In 2009, the US-based non-profit organization Earth Rights International (ERI) reported that the then ruling junta had excluded almost $5 billion in revenues — generated from the Yadana Gas project operated by oil giants Total and Chevron — from the country’s national budget.  These funds, the group found after an investigation, had been placed in two Singapore-based banks — the Overseas Chinese Banking Corporation and DBS Group — which functioned as “offshore repositories.” The banks have denied the allegations.

Source: The Irrawaddy

c) Singapore’s economic linkage with Burma is one of the most vital factors for the survival of Burma’s military regime,” says Professor Mya Maung, a Burmese economist based in Boston. This link, he continues, is also central to “the expansion of the heroin trade.”

Singapore has achieved the distinction of being the Burmese junta’s number one business partner — both largest trading partner and largest foreign investor. The close political, economic, and military relationship between the two countries facilitates the weaving of millions of narco-dollars into the legitimate world economy.

Source: Covert Action Quarterly

6. SINGAPORE / DIRTY MONEY

a) Singapore’s national pension system resembles the mother of all Ponzi schemes which is about to implode.

The PAP is aware of the widespread perception that CPF resembles a Ponzi scheme but has not been able convince Singaporeans otherwise. Instead, it has continued to conceal important information from the public.

Source: Phillip Ang

b) The days of banging a million bucks into a secret account in Singapore are over. . .the ability to move corrupt funds overseas is a large part of what makes grand corruption possible.

Source: Global Witness

c) Historically, why are there so many alleged “illegal” monies linked to Singapore?

Source: All Singapore Stuff

7. PM LEE HSIEN LOONG’S COMMENTS on BILLIONAIRES

leehsienloong

“If I can get another 10 billionaires to move to Singapore and set up their base here, my Gini coefficient will get worse but I think Singaporeans will be better off.”
— LHL, 2013

8. VIDEO ON HOW OFFSHORE BANKING WORKS:

The ICIJ Offshore Leaks Database cracks open the impenetrable world of offshore tax havens. Users can look through more than 100,000 secret companies, trusts and funds created in offshore locales such as the British Virgin Islands, Cayman Islands, Cook Islands and Singapore.

Advertisements

3 thoughts on “Offshore Banking / Money Laundering

  1. One Saturday morning in June 2007, I credited a cheque in my account with OCBC . The cheque was issued by the Trustees of my late father’s Estate. The sum was US$ 107,000 drawn on New York. The following Monday morning I received a call from the Bank that they could not process my cheque. By Tuesday morning, I was at the OCBC Chulia Street. I asked the Banking Hall Manager why the Bank did not accept my cheque even though I knew all the Chairmen and was a customer for decades. Further, I pointed out that one of the cheque’s signatories was the nephew of Lee Kuan Yew. The Manager looked non-plussed with a fleeting look of fear in her eyes. Eventually, I credited the cheque elsewhere.

    A few days later, the Singapore Business Times published a Monetary Authority of Singapore report that some customers of banks might be inconvenienced due to the application of new guidelines.

    And now we read about the vast sums of money belonging to the public in Malaysia were moved to and fro through the Singapore Banking System without a murmur.

    Liked by 1 person

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s