Alleged property scam - Profitable Plots

Profitable Plots was a well known company which hired celebrity ex-EPL footballers to advertise their products on TV. 2 of its directors recently had their long jail sentences confirmed by the High Court. However, they were convicted of cheating in relation to the sales of a chemical product called Boron.

It is interesting that although the company was known more for its landbanking practices, no charges were brought in relation to it. Profitable Plots basically sold green belt land (zoned for parks and open spaces) in the United Kingdom to investors on the promise that in future, if the green belt land was rezoned as residential land, then the investors would reap huge profits.

There were many allegations that this was a big scam. However, proving cheating under Singapore's Penal Code is difficult. The most difficult requirement is showing that the person making the promise or statement knew that what he said was untrue. In relation to the landbanking, it would be necessary to show that the company directors knew that the green belt land could NEVER be rezoned into residential land or that the land once rezoned would not be worth much more than the original price. Reports seems to suggest that green belt land had been rezoned in the past although this occurrence is rather rare. If this is the case, then whatever was claimed by the company directors would not be fraudulent. The investors who bought the land probably have legal title issued to them and so they received what they bargained for. Hence, no cheating.

Recent alleged property frauds - Ecohouse

Over the past few months, Singapore newspapers have covered several suspicious property investment scams. One of them, Ecohouse, involved building low cost housing in Brazil. News reports claim that up to $50 million was invested by persons from many different countries in the project. Now however, with many creditors of the company not being paid, audit firm PwC have been appointed as liquidators in the United Kingdom.

The hopes of recovering investors' money is small as legal and liquidation expenses are likely to be large, and at the same time, it is unclear exactly what assets are held by the ccompany.

Ren Ci and Ming Yi - court sentencing

Disgraced monk and former head of charity Ren Ci, Ming Yi, has just been sentenced to 10 months' jail and his assistant Raymond Yeung was sentenced to 9 months. They were both found guilty of several charges related to a unauthorised loan of $50,000 made to Yeung. Many of the charges related to the covering up of the loan such as making false statements to the Commissioner of Charities and creating a false payment voucher. This case is another example of where if the defendants had admitted their wrong when first discovered instead of covering it up, they may well have escaped jail sentences. However, as is often the case, the cover up offences were more numerous than the original offence.

The judge was not impressed with Ming Yi's alleged sacrifices for the charity although a strong mitigation plea was made by his Senior Counsel Andre Yeap. An aggravating factor was that there were numerous acts of trying to cover up the unauthorised loan. Also taken into account was that public trust in the charity system was affected by such acts.

A contrast can be drawn with the case of TT Durai, former Chief Executive Office of the National Kidney Foundation. He was sentenced to a jail term of 3 months under the Prevention of Corruption Act in relation to an incorrect voucher which mischaracterized commission paid to a fund raiser. However, in Durai's case, there was no loss caused to the charity. In Ming Yi's case, the loan was repaid only after investigations had begun.