Crime
SG$1 billion money laundering case: Unveiling the complex web of illicit wealth accumulation
Intricate methods of amassing illicit funds come to light as Singapore investigates a high-profile SG$1 billion money laundering case involving ten suspects.
An anonymous insider reveals four common strategies used by money launderers, shedding light on the complexities of their operations.
SINGAPORE: As authorities delve into a high-profile SG$1 billion (US$737 million) money laundering case involving ten suspects, questions arise regarding the methods employed to amass significant sums of illicit funds.
Insights from an insider shed light on four common strategies employed by money launderers.
Singapore Chinese media outlet 8world.com interviewed an anonymous person regarding commonly used money laundering methods.
Four key money laundering approaches
- Exploiting high exchange rates to entice foreign workers to remit money and launder fund
This challenge extends not only to legitimate entities like money changers but also to law enforcement authorities who concede the elusive nature of eradicating such illicit activities altogether.
One of the most familiar methods of accumulating black money involves facilitating foreign workers in sending money back to their hometowns.
Suspects possessing substantial amounts of black money readily offer attractive high exchange rates to incentivize foreign workers to funnel money through their channels.
“For instance, money launderers frequently hire agents to collect remittances from foreign workers. Subsequently, these agents locate recipients in the workers’ hometowns to disburse funds to their families. This scheme allows money launderers to amass significant cash abroad,” explained the anonymous insider.
“There are about 400,000 foreign workers here. When they receive their salary every month, they can’t wait to remit money home. The money launderers will send agents to go to foreign workers’ dormitories and remittance centres.”
There, they persuade these workers to use their services by offering favorable exchange rates.
“After the foreign workers hand over the cash they want to remit, they immediately find someone to transfer the money to their families in the foreign workers’ hometowns.”
“As long as hundreds or thousands of people ‘remit money’ through them, these behind-the-scenes bosses will naturally receive a lot of ‘cash’ from other places and other countries, right?” said the person familiar with the matter.
The exchange rates offered by these individuals are typically a few cents higher, or merely a cent or two higher, than those offered by legitimate money remitters or banks.
For migrant workers, this translates to more favourable conversion rates. However, the insider cautioned foreign workers against engaging with these operators for minor gains.
“Initially, these agents offer elevated exchange rates to cultivate trust among foreign workers. After assisting with remittances several times, they abscond with the workers’ money, leaving them with no recourse. They end up losing everything,” the insider cautioned.
2. Transfer money abroad through cryptocurrency transactions
In recent years, money launderers with a lot of black money have chosen to indirectly transfer large amounts of funds abroad by buying and selling cryptocurrencies.
Cryptocurrency is a virtual currency that is encrypted, without relying on banks to verify transactions.
“Anyone, anywhere can send and receive payments. Many people use cryptocurrency transactions to transfer funds to other countries,” he said.
3. Proxy payment for Chinese orders followed by overseas cash collection
China, as the world’s largest exporter, receives daily orders worth millions or even tens of millions of dollars from across the globe.
“In cases where conventional bank transfers entail fees for both the buyer and seller, individuals seeking to transfer black money abroad approach merchants with an offer to pay for goods on the buyer’s behalf.”
“Then the buyer pays the agent of the money launderer in a foreign country, with this method, the black money is clean in a foreign country,” said the informant.
“China’s financial system controls foreign currency strictly. In China, individuals who want to transfer money abroad must go through legitimate ways such as banks.”
“The maximum amount that can be transferred abroad cannot exceed US$50,000 yearly. Therefore, many people will transfer money abroad via different methods,” he said.
4. Collusion among local importers and exporters to underreport prices and evade tariffs
Illegal money laundering might facilitated through import and export bills. Consequently, many countries impose tariffs on goods imported from China, aiming to discourage local importers from engaging in such transactions.
“The importer and exporter will decide a ‘legit’ lower payment amount, so the importer can avoid some taxes, and then pay the difference in cash in private.
“Through this way, Chinese exporters will not lose any profits, and foreign importers can save some taxes, and the black money involved will be transferred abroad. Of course, this practice is illegal,” he said.
Banks will not deposit unknown money
The suspects in the recent money laundering raid knew the source of their cash was not “clean”, so they would not deposit it in the bank, they just keep it at home.
“When you want to deposit a large amount of cash in the bank, you need to explain the source of the money. Bank will not let them deposit if can’t disclose how they got the cash. In addition, a huge amount of cash is required to launder money,” he said.
The suspects normally accumulate their initial “dirty” money through fraud, tax evasion, corruption, gambling, drug sales, and other illegal means, then they will start to launder money and transfer funds, and then the amount of cash grows bigger and bigger.
“The eradication of money laundering activities seems nearly impossible. While only ten individuals were apprehended this time, many more remain at large,” the source concluded.
Historical crackdown on S$1 billion money laundering case
Last Wednesday (16 Aug), The Singapore Police Force (SPF) announced a significant crackdown on money laundering and forgery activities, resulting in the seizure of assets amounting to roughly S$1 billion (US$736 million).
This substantial haul includes properties, vehicles, luxury items, gold bars, and more.
In a news release, the police disclosed that ten individuals, aged between 31 and 44, were taken into custody.
They face charges related to the alleged crimes and for resisting arrest. These individuals are of diverse nationalities, including Cypriot, Turkish, Chinese, Cambodian, and Ni-Vanuatu.
Furthermore, twelve others are assisting with the ongoing investigations. An additional eight persons remain on the police’s wanted list.
“These persons are believed to have connections among themselves. All the persons involved are neither Singapore citizens nor permanent residents,” the police added.
Crime
Singaporean fugitive deported from Thailand, to be charged with drug trafficking
A Singaporean fugitive arrested in Thailand, was deported to Singapore on 19 September 2024 and faces drug trafficking charges. Authorities expect him to face the death penalty under Singapore’s tough drug laws for running a smuggling operation between Thailand, Australia, and Singapore.
A 31-year-old Singaporean man, wanted for drug trafficking offences, was arrested in Thailand and deported to Singapore on 19 September 2024.
The fugitive, identified as Benny Kee Soon Chuan, was apprehended by Thai police at his residence near Bangkok’s Suvarnabhumi Airport and will face charges in court on 20 September.
Kee, described as a high-level trafficker, ran a smuggling operation that trafficked crystal methamphetamine, ketamine, and Ecstasy to Australia and Singapore using Thailand as a transit hub, according to Pol Lt Gen Panurat Lakboon, secretary-general of Thailand’s Office of the Narcotics Control Board (ONCB).
Cross-Border Investigation and Arrest
The Central Narcotics Bureau (CNB) of Singapore had issued an arrest warrant for Kee following investigations into two drug trafficking cases in December 2020 and November 2022.
He had been on the run since 11 April 2016, prompting CNB to collaborate with its international counterparts, including the ONCB. Thai authorities were tipped off by CNB on 12 August 2024, and after weeks of investigation, Kee was apprehended on 17 September.
Thai immigration officials revealed that Kee had entered Thailand earlier in 2024 using a Vanuatu passport.
Following his arrest, Kee’s Thai visa was cancelled, and assets worth 15 million baht (S$585,000), including luxury watches, gold pieces, and a luxury car, were seized during a raid on his residence in Samut Prakan.
Lt Gen Panurat confirmed that the fugitive had been living an affluent lifestyle in Thailand despite lacking legitimate employment.
Links to Broader Drug Network
Kee is believed to be linked to other Singaporean traffickers involved in the smuggling of drugs from Thailand.
In March 2021, Thailand’s Anti-Trafficking in Persons Task Force (AITF) intercepted packages containing Ecstasy and ketamine destined for Singapore, as well as crystal methamphetamine bound for Australia.
Two other Singaporean men, aged 21 and 29 at the time of their arrests, were later sentenced to imprisonment and caning in Singapore for their involvement in these operations, which were connected to Kee’s trafficking network.
Death Penalty Under Singaporean Law
Kee’s deportation to Singapore brings him under the jurisdiction of Singapore’s severe drug laws, which prescribe the death penalty for those convicted of trafficking substantial amounts of controlled substances.
Singaporean authorities have indicated that he could face the death penalty under the country’s strict drug trafficking laws. Pol Lt Gen Panurat indicated that Singaporean authorities are expected to seek the maximum penalty for Kee’s alleged offences.
Crime
Islamic firm CEO among 19 arrested in Malaysia’s charity home abuse scandal
The CEO of Islamic firm Global Ikhwan Services and Business Holdings (GISBH) and his wife were among 19 arrested by Malaysian authorities on Thursday for alleged child abuse linked to their charity homes. Last week, police rescued 402 children from these homes. Investigations revealed a horrifying network of abuse, with at least 13 children allegedly sodomised or taught to sexually assault others.
MALAYSIA: In a major crackdown, Malaysian police have arrested several members of Global Ikhwan Services and Business Holdings (GISBH) top management, including CEO Nasiruddin Ali and his wife.
The arrests were made in a special operation conducted by Bukit Aman’s criminal investigation department at multiple locations.
As of 19 September, total of 19 people were detained, including the CEO’s two children and the child of former Al-Arqam leader Ashaari Muhammad.
Among those arrested are 12 men and seven women, aged between 30 and 65.
Inspector-General of Police Razarudin Husain confirmed the arrests and promised to provide updates soon.
The arrests come on the heels of a significant child sexual abuse scandal involving GISBH.
Last week, police rescued 402 children from 20 welfare homes linked to the organization in Selangor and Negeri Sembilan.
They also arrested 171 people, including an ustaz and a hostel warden.
The case sent shockwaves throughout the country as investigations revealed a horrifying network of child abuse.
At least 13 of the rescued children were allegedly sodomized or taught to sexually assault others.
GISBH initially denied operating the welfare homes and rejected the allegations of abuse.
However, Nasiruddin later admitted that cases of sodomy had occurred within the organization in the past, while denying any deviant teachings.
In a related development, three men linked to GISBH pleaded not guilty in a Seremban court to charges of sexually assaulting boys aged between nine and 11 at a religious school associated with the organisation.
The alleged assaults took place between 2022 and 2023 in Kuala Pilah, Negeri Sembilan.
Additionally, another man was charged in Putrajaya for allegedly threatening a woman to withdraw a police report against GISBH.
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