# Headline 1: Singapore authorities to take action against DBS, StanChart and UBS branches among others in 1MDB probe (ST, 21 Jul 2016) / Singapore seizes $240m in assets in 1MDB probe, half from flamboyant Malaysian financier Jho Low and family (ST, 21 Jul 2016)
Responding to US action overnight in its probe of corruption at Malaysian state fund 1MDB, Singapore authorities had found lapses in anti-money laundering (AML) controls in several financial institutions (FIs) in Singapore e.g. DBS, Singapore branches of Standard Chartered Bank , UBS and will be taking action against them.
What was the aftermath of the investigation?
Bank accounts belonging to various individuals had been seized, and dealings in properties, curtailed. The assets amount in total to S$240 million. Of these bank accounts and properties, about S$120 million belong to Mr Low Taek Jho (*above picture) – Malaysian financier and confidant of Malaysian premier Najib Razak – and his immediate family.
Responses by the relevant statutory board / authorities:
Investigations into 1MDB-Related Fund Flows through Singapore (MAS, 21 Jul 2016):
A joint statement by the Attorney-General’s Chambers, Commercial Affairs Department (CAD) and Monetary Authority of Singapore (MAS) said they were continuing their investigations of various 1MDB-related fund flows through Singapore for possible money laundering, securities fraud, cheating, and other offences committed here.
MAS examining Goldman Sach’s involvement in 1MDB bond deals (TODAY, 30 Jul 2016)
Singapore launches unit to fight money laundering (CNA, 1 Aug 2016)
Mahathir criticises Singapore’s handling of 1MDB investigation (AsiaOne, 2 Aug 2016)
2 more charges for former private banker linked to 1MDB probe (CNA, 18 Aug 2016)
1MDB: Pre-Trial Conference Date Set (finews.asia, 26 Aug 2016)
# Headline 2: Mosque chairman accused of siphoning $370,000 in cash collections over 7 years (ST, 4 Aug 2016)
More about the culprit:
Ab Mutalif Hashim (*above picture), a 55-year-old former chairman of Masjid Darussalam (*a mosque in Commonwealth Avenue West), and also the chairman of the mosque’s management board.
He had filched $371,891 in cash collections between January 2006 and March 2013, allegedly using $18,291 to pay for expenses incurred by the Association for Devoted and Active Family Men (ADAM) , of which he is president. The voluntary welfare organisation addresses issues faced by men. He purportedly deposited the rest of the cash into various bank accounts.
What was the aftermath of his actions?
Charged with 14 counts of misappropriating more than $370,000 from its coffers, he faces up to 10 years’ jail and a fine, for the crimes committed prior to 2008 If found guilty of criminal breach of trust. For the offences committed in 2008 and after, he faces up to 20 years’ jail and a fine, or life imprisonment, if convicted.
More about the Islamic Religious Council of Singapore (MUIS): Established as a statutory body in 1968 when the Administration of Muslim Law Act (AMLA) came into effect.
MUIS, In relation to the case:
Response by MUIS:
MUIS said it has policies and procedures in place to ensure good governance in mosques.
“ MUIS does not condone any financial impropriety at our mosques and had sought the assistance of the police when it detected the financial irregularity at Darussalam Mosque..Notwithstanding this case, MUIS appreciates the invaluable contributions of our mosque volunteers, who have been serving their community and congregation selflessly through the years, and hopes that the volunteers continue to give off their best for our mosques and community.”
Follow-up updates: The case was to be mentioned again on Aug 10. However, there was no media coverage or updates so far on the case.
# Headline 3: Social service officer charged with stealing $340,000 meant for needy (TNP, 4 Aug 2016)
More about the culprit:
Chia Kwang Hwee, 33 years old, a Ministry of Social and Family Development (MSF) employee whose job involved disbursing money to low-income families in need of financial assistance. At the time he was caught, he was a team leader at a Social Service Office (SSO) at Geylang Serai.
He had allegedly diverted financial assistance funds to his own bank accounts, and used the money to pay off his debts and lead an extravagant lifestyle. Over three years from 2011 to 2014, he allegedly pocketed $343,480 and splurged part of his ill-gotten gains on fine dining, airline tickets, and high-end boutiques.
Chia’s first offence allegedly happened when he encashed cheques worth $2,400 issued by the South East Community Development Council in 2011. In 2012, he allegedly misappropriated cheques worth almost $60,000, and in 2013, he misappropriated cheques worth nearly $140,000. He also faces 65 charges of using the Social Assistance Network System accounts of his colleagues to misappropriate more than $140,000 in 2013 and 2014.
What was the aftermath of his actions?
The ministry made a police report against Chia for alleged fraud after confirming that one of the bank accounts was Chia’s payroll account. He has been charged with misappropriation of funds, and faces a total of 126 charges under the Computer Misuse and Cybersecurity Act and the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act.
More about Ministry of Social and Family Development (MSF): It is a Government ministry.
Areas it focus on includes:
- Enhancing social safety nets for low-income and needy individuals and families.
- Improving the delivery of social services by working closely with the people and private sectors.
- Creation of a more conducive environment for family formation and the strengthening of family bonds and resilience.
- Review policies to meet family needs such as childcare and eldercare effectively.
- Invest resources to develop the social service sector e.g. attract, develop and retain social service professionals, raise sector capability and productivity, and improve service co-ordination.
MSF, in relation to the case:
Culprit was a Ministry of Social and Family Development (MSF) employee.
Response by MSF:
MSF said its internal auditor has conducted checks on all SSO payment records, and confirmed no other occurrences of a similar nature.
- Strengthening the administration of access to our IT system;
- Including additional checks to ensure payments to clients; and
- Allocating cases such that no officer will be allowed to take charge of a particular client for more than two consecutive years.
“Control measures can only go so far. Too many and it becomes onerous and less agile, too few and you run the risks of abuse..I am proud that many of our officers serve with passion and dedication. But the ministry will not condone or tolerate any conduct that undermines the integrity of our social assistance system and interest of our beneficiaries.”
Follow-up updates: Chia is out on $100,000 bail, and has surrendered his passport. His case will be mentioned again on Sept 7. No media updates so far on the case.
In its latest report for financial year 2015/16, the Auditor General’s Office (AGO)flagged lapses and inadequate financial controls in six ministries and six statutory boards. Click HERE for AGO’s full report.
What is the function of the Auditor General’s Office (AGO)?
AGO is an independent organ of state and the national auditor. They enhance public accountability in the management and use of public funds and resources through their audits of the following areas:
- government ministries and departments
- organs of state
- statutory boards
- government funds
- other public authorities and bodies administering public funds (upon their request for audit), e.g. government-owned companies
What were the audit findings and observations?
“..(To) highlight the following areas where public sector entities could pay greater attention to and where improvements could be made:
- Inadequate financial controls
- Weak governance over management of public funds
- Lack of oversight of administration of schemes and programmes
- Lapses in management of contracts
The 6 ministries and their respective audit observations:
- Ministry of Defence (MINDEF)
For the audit of the Savings and Employee Retirement and Premium Fund (SAVER-Premium Fund), AGO covered the Receipts and payments; and Investments in it’s checks:
Failure to Provide for Central Provident Fund Contributions for Bonus Paid
Investment Made Without Proper Approval and Evaluation
- Ministry of Education (MOE)
Lapses in Monitoring and Enforcement of Scholarship Bonds
Tuition Fee Loans and Study Loans Due Not Promptly Recovered
Undue Delay in Review of Agency Fees
Over-contributions to Sinking Fund
Inadequate Monitoring of Research Progress
AGO report: Long delay in MOE review draws scrutiny (ST, 27 Jul 2016)
AGO report: AGO flags weak MOE controls over public funds (ST, 27 Jul 2016)
AGO report: Lapses in enforcing scholarship bonds (ST, 27 Jul 2016)
*Work ban for foreign student loan defaulters (AsiaOne, 16 Aug 2016)
- Ministry of Foreign Affairs (MFA)
Irregularities in Management of and Payments for Telecommunication Services
- Ministry of Home Affairs (MHA)
Singapore Police Force Overpayment of Allowance to Volunteer Special Constabulary Officers
- Ministry of Law (MOL)
Lapses in Administration of Assets Received from Nursing Homes
Weaknesses in Monitoring of Access to IT System
- Ministry of Manpower (MOM)
Procured System Not Used Resulting in Wastage
*Response by MOM (CNA, 26 Jul 2016)
The 6 statutory boards and their audit observations:
- National Arts Council (NAC) [under Ministry of Culture, Community, and Youth]
For the audit of the NAC covered the following areas in its test checks,
- Contract management for the redevelopment of Victoria Theatre and Victoria Concert Hall;
- Procurement and payment;
- Administration of grants;
- Management of tenancies; and
- Administration of fixed assets:
Lapses in Management of Victoria Theatre and Victoria Concert Hall Redevelopment Project
*Why is a centralised NAC bin centre needed? (Gov.sg, 30 Jul 2016)
- Nanyang Polytechnic (under MOE)
Proper Governance Framework Not in Place and Transactions with Subsidiary Not at Arm’s Length
Donations Raised for Unauthorised Purpose
Lapses in Tendering and Management of Revenue Contracts
AGO report: Nanyang Poly found weak in governance (ST, 27 Jul 2016)
*Response by NYP (ST, 27 Jul 2016)
- Intellectual Property Office of Singapore (Under MOL)
Lapses in Procurement of Goods and Services
- Housing Development Board (Under Ministry of National Development)
Long Delays in Finalising Accounts of Contracts and Making Final Payments to Contractors
Inadequate Monitoring of Car Park Operations and Enforcement
*Response by HDB (ST, 26 Jul 2016)
- Land Transport Authority of Singapore (LTA) [Under Ministry of Transport]
Weaknesses in Controls over Revenue Collection at Checkpoints
Undue Delay in Finalisation of Agreement with Mass Rapid Transit System Operator
* Response by LTA (ST, 26 Jul 2016)
- Civil Service College [Under Prime Minister’s Office (Public Service Commission)]
Lapses in Administration of Course Fees
Lapses in Administration of Trainer Fees
Follow-up updates: Government’s overall response towards AGO report
Government responds to lapses found by AGO (ST, 17 Aug 2016)
AGO report: 28 officers counselled or warned (AsiaOne, 17 Aug 2016)
According to Senior Minister of State for Finance and Law Indranee Rajah:
– Most of the lapses AGO highlighted are due to individual officers not complying with procedures, rather than weakness in the system as a whole. Respective agencies have – in all cases – taken steps to rectify the weaknesses identified. With over 140,000 officers in the Public Service handling hundreds of thousands of transactions each year, human laxity or errors of judgment will happen.
– “We take each and every lapse seriously, but if nothing was found by AGO, we would be very concerned about the independence and rigour of AGO’s audits.”
– No findings of fraud, corruption or personal gain, or any suggestion of financial malfeasance. AGO does not hesitate to report suspicious wrongdoings to the relevant authorities and highlight them in its report. The Government has zero tolerance for, and acts promptly and thoroughly to investigate such cases.
# Headline 5 : Aljunied-hougang Town Council auditors find ‘pervasive’, systemic lapses and lax controls (ST, 21 Jul 2016)
Auditors of Workers’ Party-run Aljunied-Hougang Town Council (AHTC) had found “pervasive control failures” in its accounts and work processes over the past five years which covered key areas of governance, financial control, financial reporting, procurement and records management. KPMG also found that the town council’s management lapses went beyond individual issues. They were a systemic problem.
What was the aftermath of the investigation?
Response by WP-AHTC:
WP town council to get new accounting system (ST, 30 Jun 2016)
AHTC chairman Pritam Singh said AHTC will review the work processes of the Town Council to strengthen controls. It has also called a tender for a new town council accounting system, and will appoint an internal auditor to ensure management, governance and control processes are working (21 Jul 2016)
AHTC had said it aimed to complete its rectification plans in 15 months. “AHTC accepts the control shortcomings in the use of these codes and will be reviewing its processes to ensure their proper use in future,” – AHTC chairman Pritam Singh (19 Aug 2016)
“The Aljunied-Hougang Town Council (AHTC), run by the Workers’ Party (WP), has agreed to hand over financial documents to rival Pasir Ris-Punggol Town Council (PRPTC) but only those that relate strictly to Punggol East constituency. This was agreed on in the Court of Appeal on 18 Aug 2016. It is, however, only a partial agreement as their lawyers and accountants will have to meet to thrash out the conditions for PRPTC to access documents with information that includes other parts of AHTC as well.” – Straits Times (19 Aug 2016)
Response by the government:
According to National Development Minister Lawrence Wong,
– Currently, the Ministry of National Development (MND) has no power to compel town councils to give information and there are no penalties if a town council refuses to do so. Changes to the law on town councils to ensure public funds are managed properly are being finalised and should be ready by the year end.
-The amendments will ensure that town councils have a “proper governance structure”. Covering three key areas, it will make clear that town councils must comply with the law and agencies enforcing it.
– Governance and accountability will be strengthened so town councils plan and use their finances in a sustainable way. The ministry will have stronger regulatory oversight, with powers to get information and make investigations.
Follow-up updates: No latest news coverage so far.
Article was first published in Offbeat Perspectives.