SINGAPORE: Soon Kok Khoon (“Soon”), the operator of Club Posh Entertainment LLP (“CPE”) and West Palace Entertainment (“WPE”) (collectively, the “Clubs”), has been sentenced by the Court to six months and 34 weeks imprisonment and ordered to pay penalties totalling $630,861, after being convicted of offences involving Goods and Services Tax (GST) evasion and money-laundering.
For three counts of GST evasion under Section 62(1)(b) of the Goods and Services Tax Act, Chapter 117A (“GSTA”) read with Section 107(c) of the Penal Code, Chapter 224 (“PC”) and punishable under Section 62(1) of the GSTA read with Section 109 of the PC for evasion of Goods and Services Tax (“GST”), involving $210,287 of tax undercharged, Soon was sentenced to 34 weeks’ imprisonment, and ordered to pay a penalty of $630,861, which is three times the GST amount he evaded. Five other GST evasion charges were taken into consideration for this sentencing.
For three counts of money-laundering under Section 47(1)(a) of the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (Chapter 65A, 2000 Revised Edition) (“CDSA”), punishable under Section 47(6)(a) of the CDSA, involving the disguise of property amounting to $3,214,389, Soon was sentenced to six months imprisonment. Five other money-laundering charges were taken into consideration for this sentencing.
Investigations revealed that Soon had aided the Clubs to make false entries in their GST returns, with wilful intent to evade GST, by instructing the Clubs’ accountants (the “Accountants”) to omit reporting sales revenue of the Clubs (mainly from the sale of flower-garlands) and the output tax thereon in 2016.
Investigations also revealed that Soon had instructed his staff to divert the sales revenue of the Clubs (which were GST-registered) to two other entities (“Shell Entities”) using separate point-of-sale (“POS”) terminals linked to the Shell Entities. These Shell Entities were not GST-registered and had no actual business activities. The undeclared revenue from the sales of the flower garlands was recorded as proceeds from fictitious sales of souvenirs in the accounts of the Shell Entities. By doing so, Soon had thereby disguised monies which, in part, directly represented the benefits of his criminal conduct from GST evasion.
Please refer to Annex A (PDF, 118KB) for the summary of the modus operandi and Annex B (PDF, 198KB) for photos of the flower garlands.
Penalties for Non-Compliance
Penalties for Evading GST
It is a serious offence to wilfully submit false GST returns by overstating any input tax, understating any output tax or including fictitious transactions. Upon conviction, offenders may face a penalty of three times the amount of tax undercharged, a fine not exceeding $10,000, and/or imprisonment of up to seven years.
Penalties for Money Laundering
Under Section 47(6) of the CDSA, any person who acquires, possesses, uses, conceals or transfers benefits from criminal conduct shall be liable on conviction, if the person is an individual, to a fine not exceeding $500,000 or to imprisonment for a term not exceeding 10 years or to both.