Hornbill Unleashed

March 30, 2013

Sin City – ‘the jurisdiction of choice by people like us’

Tan Wah Piow

Singapore is “the jurisdiction of choice by people like us”. This boast by rogue lawyer Alvin Chong of Sarawak, caught on video by journalists from London-based Global Witness posing as investors interested in land deals,  has gone viral.

The “people like us” presumably  includes the minions and their corrupt politicians in Asia, as well as tax dodgers, and criminals who erstwhile had sheltered their ill-gotten wealth in Switzerland.

The stealth video exposes not just the rampant corruption in Sarawak, it also highlights how virgin forests are stolen from the people, and the arrogant contempt for the indigenous people by the perpetrators of such crimes. Viewers are universally shocked by the revelations.

Singapore, being the “jurisdiction of choice” where the corrupt deal would be executed, is implicated, not just by association – but by providing the legal framework which made such crimes possible.

So extraordinary is the expose that the video caricature of this rogue lawyer gleefully boasting about his corrupt exploits will  become the defining image of corruption, deforestation, and the role of Singapore as  the Sin City “of choice” for the likes of Alvin Chong.

This video has devastating consequences to those in power in Sarawak and indeed, the whole of Malaysia. It has also attracted worldwide attention, especially amongst the burgeoning environmental lobbies, and green movements and every organization in the West campaigning for transparency in financial transactions. Anti-tax evasion NGOs will now take a keen critical interest in Singapore as a financial centre.

The imagery of idyllic innocent tropical rain forests of Sarawak being traded for the glitzy cityscapes of Singapore is such a powerful contrast that Singapore Inc will now become an object environmentalists and anti-capitalists campaigners  love to hate. This certainly is not the image of the global city that the people in Singapore cherish. For this unfortunate consequence, the Singapore government has a great deal to answer for.

Alvin Chong no doubt merely articulated what everyone suspects for a long time. But coming from the horse’s mouth stung Singapore Inc  where it hurts because it needs to maintain the semblance of respectability in the international stage, especially before the IMF, Europe and USA. Such expose potentially could scare away lucrative foreign funds and super rich depositors if they become worried of the stigma of banking in Singapore.

It is also an unfortunate coincidence that in the same week as the expose was released, London Guardian newspaper carried a report of the resignation of French budget minister over his alleged secret account in Singapore from funds he was said to have hastily transferred from Switzerland. As noted in a Reuters report last year, “as cash-strapped Western governments increase their efforts to improve tax collection and Swiss banks are forced to open up their books, Singapore is facing renewed accusations that some of the funds flowing in may be illicit.”

Clearly, if the illicit money from Sarawak did find its way into Singapore as Alvin Chong confessed, the MAS (Monetary Authority of Singapore) would have to account to international bodies such as the IMF as to how it could happen despite its claim of having put in place anti-money laundering procedures. This could have serious ramifications to the integrity of the banking and finance industry of Singapore  which provides more than 120,000 (5.5% of overall employment) jobs in over 700 financial institutions , accounting for more than 11% of Singapore’s GDP (2010 figures).

For an expose of such seriousness, the official Singapore response is certainly lackluster. The Ministry of Finance press statement denied that it did ever fail to cooperate with the Malaysian tax authorities when matters of tax evasion were raised.

The Ministry of Finance, however, kept  a deafening silence on the central issue of whether illicit corrupt money had found its way into Singapore. Their failure to make any attempt to contact Global Witness to edit out any aspects of the video which are damaging to Singapore’s reputation is unusual.

The normally thin-skin Singapore government and their ministers had for decades indulged in libel suits against their critics in the Singapore courts. Suddenly the Singapore Inc officialdom has grown the hide of a rhino. The MOF and the MAS could, for example, seek an injunction in London court against Global Witness if Singapore’s reputation is tarnished by the insinuation in the stealth video. That will guarantee it an international platform and opportunity to protest its innocence.

Unfortunately, the likelihood of the Singapore government doing anything against Global Witness in London is realistically slim for obvious reason, yet the failure to defend its “honour” remains a lacuna.

The dear leaders in Singapore are aware that as a member of the international community, and the IMF, combating money laundering is, in the words of Min Zhu, the deputy managing director of the IMF, not only a  “moral imperative, but also an economic need.”.

The laundering of corrupt funds from the Suhartos, Marcos, Chinese, Indians, Thais, Burmese etc benefits the few in Singapore, and lend comfort to the corrupt. But in the long term, Singapore is inadvertently helping to sow the seeds of social revolutions in  those countries as taxes and funds from corruption, which could otherwise be deployed to pay for health, education and industrial developments in the respective countries, find their way into the bank coffers in Singapore.

As a tax haven, it transforms illicit cash into respectable capital. In the process, the local economies where the illicit funds originate, are drained dry, environment destroyed, and people impoverished.  This is the reason behind the IMF economic argument to combat  money laundering. It is therefore the height of hypocrisy for politicians  to, on the one hand, decry the political and social instability in the region; while at the same time, be happy to act as the conduit for such proceeds of crime.

In the changing international mood and intolerance towards laundering of illicit money, Singapore’s quest to replace Switzerland is therefore regressive. Singapore is already on the radar of the American Human Rights Watch which accused it of laundering billions of dollars of Burma’s state gas revenues hidden from national accounts. [HRW 2011]

If Singapore’s future success as a global finance center depends on it’s ability to attract funds of questionable provenance, then at best, it could only take pride in transforming the little red dot into Sin City. That could be tremendously lucrative for Singapore Inc, but not necessary for Singapore. The trillions may be in the coffers of Singapore banks, but to the losers in the region, the island state is merely “handling stolen goods”.

I am sure the over 120,000 Singaporeans in the banking and financial services, and the corporate lawyers have the intellect to restructure Singapore as a progressive financial centre without having to bid for illicit funds. Other than paying lip service, the current government lacks the moral commitment, courage and political vision for a new world order whereby the economies of the region could be free of distortion and stagnation caused by corruption and tax evasions.

The Sarawak expose poses a challenge to Singaporeans to rethink the Sin City model.



  1. As far back as in 2006, Indonesian Corruption Watch (ICW) suspected that a large part of the Rp506.8 trillion in funds then parked in Singapore was owned by former embezzlers of state and private national banks.

    Teten Masduki, the Coordinator of ICW, said that there were in fact some law-abiding Indonesians who have assets and save their funds in Singapore.

    However, the amount of these funds is relatively small compared to that of former embezzlers.

    “It’s a pity to see they still save their money there,” Teten told Tempo.

    His remark was in response to the result of Merrill Lynch and Capgemini’s survey which reported that one-third of 55,000 Singapore’s rich people are Indonesians.

    The number reaches a total of 18,000 and their status is that of permanent residents (foreigners who have permanent stay permits) in Singapore.

    The global financial organization estimates that the amount of assets of Indonesian people in Singapore is S$87 billion, or around Rp506.8 trillion.

    According to Teten, embezzlers prefer to deposit their funds in Singapore because they feel safe there although the origin of the funds is illegal.

    The reason for this is that Singapore does not have a Money Laundering Law nor is it yet willing to sign an extradition agreement with Indonesia.

    Through such an agreement, Indonesia can force Singapore to surrender bad debtors, including return of assets and funds.

    Teten acknowledged that Indonesians also save funds in Singapore because of other factors, for example business.

    This is because the business and investment climate in Singapore is very attractive.

    “In addition, legal certainty is also good, far better compared to in Indonesia,” he said.

    Sofjan Wanandi, Head of Indonesia Entrepreneurs Association, made similar comments.

    A lot of Indonesians save their money in Singapore because the investment climate is extremely interesting.

    The country’s government provides facilities including tax and business credit allowances.

    “Singapore also provides legal certainty to investors.”

    Comment by Mata Kuching — March 30, 2013 @ 7:12 PM | Reply


    Comment by Anon — March 30, 2013 @ 8:05 AM | Reply


    Comment by NEWSITEMS — March 30, 2013 @ 8:02 AM | Reply

  4. I once told my Singaporean partner,that if ever those ruling Juntas of Myanmar, those Tax evading Indonesian companies, politician n cronies and 90% of Malaysian politicians with their ill gotten gain and it’s cronies were to suddenly decide to take out their money out of Singapore’s boutique Banks, the island nation will actually float a micro metre, he just laugh and confirm that it’s true,Singapore has been the new Switzerland years ago,but it’s just that they are good at keeping it quite until Dear Mr Alvin Chong’s revelation…Oouch!!!but true

    Comment by Lok1 — March 30, 2013 @ 3:40 AM | Reply

    • Let’s use our own mind! Forget about the SOBs/DOBs. “Government” is a tool by which politicians embody their whimsy fancies for their own sweet deals. Along the way, life does not fail…simply because Life is too big to fail but it can be better.

      In the crummiest moments of his life, socialist Mao lost his nerve and slaughtered those SOBs/DOBs, but that was then as it is not now and life is too big to fail. Banks can fail but many now have sexy ideas how we can rebuild life and the money system.

      You could give Alvin and the other loyar some doubts as what they’ve done has some dynamics not of their own initiatives even. There are many ways to skin a cat and loyars are never abosolutely innocent. Haven’t they saved lives by some bad sentences or phrases or worst by a comma ?

      The way things are what will PR do if we send them into government? Well, life can be better…ain’t life too big to fail? How much better depends on US! That’s not the US of A …”us” Malaysians!

      Singapore is a dictatorship as Malaysia is. Malaysia is worst because we’re bigger and therefore worst by sheer size! When Lee Kuan Yew dies, which maybe soon, (I hope so) the Lee family has to die with him…there has been too much indignity done on Singaporeans…and Indonesians and us, too!

      Lee Kuan Yew is a concoction of Cambridge University whose training lent him so much credibility they fall all over themselves that he came from there.

      As for Malaysia, which is badder in its sheer size, we’re still in old pre Malacca days. The royalty are still as bad as they were…why, it was not too many moons ago, that the PDRM was party and servants to the palace conspiracies in Kelantan where there was a fight for power! You can check youtube for the evidence. And we’re in the 2nd Millinnium!

      The SOBs/DOBs in UMNO think they’re noble and civilized but they’re no less a hoodlum than Lee Kuan Yew!

      Comment by Chai Kruk Lek — March 30, 2013 @ 8:19 PM | Reply

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