The Court imposed the following sentences on Lee for the offences committed between 2014 and 2017:

• For 31 counts of making false entries in the GST returns of three companies – Everasia T&W, Hup Heng and Sante – resulting in $2.97 million of taxes undercharged, Lee was sentenced to between 16 and 20 months’ imprisonment for each offence and a total penalty of $8.91 million which is three times the amount of tax undercharged in these 31 charges;
• For one count of abetting Nourriture in making incorrect GST returns without reasonable excuse resulting in $58,456 of taxes undercharged, Lee was ordered to pay a fine of $5,000 and a penalty of $116,912 which is twice the amount of tax undercharged;
• For one count of submitting a false PIC claim to obtain a payout of $60,000, Lee was sentenced to 8 weeks’ imprisonment and a penalty of $240,000 which is four times the amount of PIC cash payout fraudulently claimed;
• For four counts of money laundering activities involving using illegally obtained GST refunds and PIC cash payouts for various business purposes, including legal expenses and supplier payments totalling $1,652,030, Lee was sentenced to between 10 months’ imprisonment and 27 months’ imprisonment for each offence;
• For three counts of money laundering activities involving transferring illegally obtained GST refunds to multiple persons and entities for various business purposes, including employees’ salary and rental payments totalling $2,091,482, Lee was sentenced to between 9 months’ imprisonment and 43 months’ imprisonment for each offence; and
• For one count of directly taking part in the management of Hup Heng, whilst an undischarged bankrupt and without the leave of the Court or the written permission of the Official Assignee, Lee was sentenced to 3 months’ imprisonment.

Related matters

Lee, who was adjudged a bankrupt in April 2016 and could no longer be registered as a director of his companies without the leave of the Court or the written permission of the Official Assignee, had requested 42-year-old Andy Siew Hui Hock (“Siew”) to be a director of the companies in name. After being appointed as director, Siew was entirely uninvolved in the business and operations of the companies and did not take any steps to find out about their ongoing business activities.

Siew was convicted on 27 January 2022 of two counts of an offence punishable under Section 157(3)(b) of the Companies Act for failing to exercise reasonable diligence in the discharge of his duties as a director of Hup Heng and Sante. Another three counts of the same offence were taken into consideration for the purpose of sentencing. Siew was sentenced to a fine of $5,000 (in default 10 days’ imprisonment) for each offence and disqualified from acting as a director or taking part, whether directly or indirectly, in the management of a company for a period of three years.

Penalties for Non-Compliance

Fraudulent GST Claims

It is a serious offence to wilfully evade tax by submitting false GST returns, such as by understating any output tax, overstating any input tax, excluding taxable supplies or including fictitious transactions. Upon conviction, offenders are liable to pay a penalty of three times the amount of tax undercharged and are liable to be punished with a fine not exceeding $10,000, and/or to imprisonment of up to seven years.

With the enhanced sentencing framework for GST evasion, offenders will face a stiffer imprisonment sentence which takes into account the harm caused by the offender and his or her culpability, such as the quantum of tax evaded, the degree of planning and premeditation and sustained period of offending. The imprisonment term imposed for GST evasion under Section 62 of the GST Act may span the full range of up to seven years.

Money Laundering

It is an offence under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act for any person to acquire, possess, use, conceal or transfer benefits derived from criminal conduct. Upon conviction, offenders are liable to be punished with a fine not exceeding $500,000, or an imprisonment term not exceeding 10 years, or both.

Singapore takes a serious view on fraudulent GST refund claims and related money laundering activities and will not hesitate to take stern enforcement actions against any individuals who commit these offences and persons who facilitate them.

Managing a Company whilst an Undischarged Bankrupt

It is an offence under Section 148(1) of the Companies Act for any person, being an undischarged bankrupt (whether he was adjudged bankrupt by a Singapore Court or a foreign court having jurisdiction in bankruptcy), to directly or indirectly take part in or be concerned in the management of a company without the leave of the Court or the written permission of the Official Assignee. Upon conviction, offenders are liable to be punished with a fine not exceeding $10,000, or an imprisonment term not exceeding two years, or both.

Failing to Exercise Reasonable Diligence in the Discharge of their Duties as a Director

Any person who commits a breach of Section 157(1) of the Companies Act shall be guilty of an offence punishable under Section 157(3)(b) of the same Act and shall be liable on conviction to a fine not exceeding SGD 5,000 or to imprisonment for a term not exceeding 12 months.

The Police takes a serious view of the offence and will not relent in taking offenders to task. Individuals should not be a director of a company when they have limited or no oversight or control, as the company may be used for illegal purposes, such as the laundering of criminal proceeds. Company directors who fail to exercise reasonable diligence in the discharge of their duties run the risk of allowing their companies to facilitate the retention of benefits derived from criminal conduct.

Source: IRAS

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For their offences, they were sentenced by the Court to the following:

Source: IRAS

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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.

Source: IRAS

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Despite Print Orient being GST-registered, Loh had conducted cash sales with Print Orient’s customers without accounting for them in both the Income Tax and GST returns of Print Orient. He deliberately omitted to do so with the intention to evade tax. This resulted in $110,119 of GST undercharged between 1 May 2011 to 31 October 2017 and $69,391 of Corporate Income Taxes undercharged between Year of Assessment (“YA”) 2013 to YA 2017.

Loh faced a total of 31 charges for tax offences, out of which 10 were proceeded with and the remaining 21 were taken into consideration for the purposes of sentencing.

In addition, sometime in August 2013, Loh had instigated his staff to alter inventory figures to inflate the profits of Print Orient in the company’s management accounts for the financial year ending 31 October 2012. Loh then emailed the management accounts containing the inflated profits to Maybank Singapore Limited (“Maybank”), in an attempt to dishonestly induce Maybank into approving Print Orient’s loan application.

The Court imposed the following sentences on Loh for the proceeded charges:

• For 8 counts of making false entries in the GST returns of Print Orient, Loh was sentenced to 1 month’s imprisonment for each offence, and a total penalty of $174,679 which is three times the amount of tax undercharged;
• For 1 count of abetting the company in making a false entry in the Corporate Income Tax return of Print Orient in YA 2013, Loh was sentenced to 1 month’s imprisonment and ordered to pay a penalty of $58,914 which is three times the amount of tax undercharged;
• For 1 count of making false entries in the Corporate Income Tax returns of Print Orient in YA 2017, Loh was sentenced to 2 weeks’ imprisonment and ordered to pay a penalty of $19,602 which is three times the amount of tax undercharged;
• For 1 count of money laundering by using the underdeclared sales of Print Orient to pay for his HDB loan and the downpayment for his condominium and vehicle, totalling more than $400,000, Loh was sentenced to 6 months’ imprisonment; and
• For 1 count of attempting to cheat Maybank into approving Print Orient’s loan application using Print Orient’s falsified management accounts, Loh was sentenced to 6 months’ imprisonment.
• For 8 counts of making false entries in its GST returns, the Court also ordered Print Orient to pay a fine of $20,000 and a penalty of $174,679, which is three times the amount of taxes undercharged.

Penalties for Non-Compliance

IRAS Warns Against Tax Evasion

IRAS takes a serious view of non-compliance and tax evasion. There will be severe penalties for those who wilfully evade tax. The authority will not hesitate to bring offenders to court. Offenders may face a penalty of up to four times the amount of tax evaded. Jail terms may also be imposed.

Money Laundering and Criminal Offences

It is an offence under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act for any person to acquire, possess, use, conceal or transfer benefits derived from criminal conduct. Upon conviction, offenders are liable to be punished with a fine not exceeding $500,000, an imprisonment term not exceeding 10 years, or both.

For cheating, offenders shall be punished with imprisonment for a term not exceeding 10 years and shall also be liable to a fine.

Source: IRAS

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Chuang is also convicted of 2 charges for providing false statements to the Inland Revenue Authority of Singapore (IRAS) during its investigations. Investigations revealed that Chuang had lied in his statements to IRAS’ investigation officers that the stamp certificates were created by a person by the name of “Sunny” when in fact no such person exists. Chuang himself had in fact counterfeited the stamp certificates.

Court Sentences

Chuang pleaded guilty to 19 proceeded charges under Section 64(d) of the Stamp Duties Act (Cap. 312) for counterfeiting stamp certificates. The Court sentenced him to 30 weeks of jail term and took into consideration 39 other charges of the same offence for the purpose of sentencing.

For the 2 proceeded charges under Section 65(2) of the Stamp Duties Act (Cap. 312) for furnishing of information that was false to IRAS, the Court sentenced him to 5 weeks of jail term. 4 other charges of the same offence were taken into consideration for the purpose of sentencing.

Serious Consequences for Providing False or Misleading Information or Statement to IRAS

IRAS takes a very serious view of any individual who intentionally provides false or misleading information to IRAS in the course of investigations to deter IRAS from the proper administration of its functions. One may also be guilty of a criminal offence for providing false or misleading information to IRAS officers in the course of IRAS audits and queries. Any person found guilty of such an offence under the law shall be liable on conviction to a fine not exceeding $10,000 or imprisonment for a term not exceeding 2 years, or with both.

Serious Crime to Counterfeit Stamp Certificates and Use Counterfeit Stamp Certificates

Stamp duty is paid on documents or agreements relating to immovable properties and stock or shares. Such documents or agreements include tenancy or lease agreements, options to purchase, sale and purchase agreements and transfer instruments. A stamp certificate is issued to certify that the stamp duty relating to the document or agreement has been paid. Each stamp certificate is printed with a Unique Document Reference Number. IRAS takes a very serious view of stamp certificate forgeries and knowing misrepresentation or passing off of counterfeit “certificates” as genuine ones. Individuals or businesses engaging in such activities shall be liable on conviction to a fine not exceeding $10,000 or to imprisonment for a term not exceeding 3 years or to both.

Online Check on Stamp Certificate Authenticity

IRAS reminds tenants, property buyers and transferees to check the authenticity of the stamp certificates in their possession by visiting the e-Stamping Portal, and selecting “Check Stamp Certificate Authenticity”. An authentic stamp certificate should bear the full details of the stamp duty payment, description of the document, date of the document and details of the property, stock or shares (whichever is applicable). All these details should also match the information shown on the e-Stamping Portal. If your stamp certificate appears dubious or incomplete, please contact IRAS to verify the authenticity of the stamp certificate.

Source: IRAS

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(a) 3 offences of GST evasion whereby Ang wilfully with intent to assist the company, Fabriglass, to omit output tax totalling $327,497 in the GST returns of Fabriglass for 3 quarters from April 2016 to December 2016; and

(b) 1 offence –for wrongful issuing of a tax invoice to its customer on 28 November 2015 and unlawfully charged and collected $7,027 as GST, during the time when Fabriglass was not a GST-registered business.

Court Sentences

For the 3 proceeded charges under section 62(1) of the GST Act, the Court sentenced Ang to 64 weeks of imprisonment and ordered him to pay a penalty of $982,491, which is 3 times the amount of GST undercharged.

For the 1 proceeded charge under section 64(2)(a) read with section 74(1) of the GST Act, Ang was ordered to pay a penalty of $21,082, which is 3 times the amount of GST collected and a fine of $1,500.

IRAS’ audit programme uncovered the offence

IRAS conducts regular audits of GST-registered businesses, and such GST omissions can be detected through the use of data analysis and risk profiling. Using data analytics and advanced statistical tools, IRAS is able to cross-check data and detect anomalies. This case was uncovered through one such audit programme.

Severe Penalties for GST Evasion

It is a serious offence to wilfully evade tax or to wilfully assist another person to evade tax by submitting false GST returns such as by understating any output tax, overstating any input tax, excluding taxable supplies or including fictitious transactions. Upon conviction, offenders are liable to pay a penalty of three times the amount of tax undercharged and are liable to be punished with a fine not exceeding $10,000, and/or to imprisonment of up to seven years.

With the endorsement of the enhanced sentencing framework for GST evasion by the High Court on 17 January 2022 following the case of PP v. Pua Om Tee, offenders will face a stiffer imprisonment sentence which takes into account the harm caused by the offender and his or her culpability, such as the quantum of tax evaded, the degree of planning and premeditation and sustained period of offending. The imprisonment term imposed for GST evasion under Section 62 of the GST Act may span the full range of up to seven years.

Unauthorised issue of tax invoices to charge and collect GST

It is a serious offence for businesses that are not GST-registered to issue tax invoices and collect GST from their customers. Offenders face a penalty of three times the amount of tax unlawfully collected and a fine of up to $10,000 for each offence.

Source: IRAS

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