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Agritrade executive jailed for 20 years for role in fraud scandal

Singapore authorities have sentenced Agritrade’s former chief financial officer to 20 years’ imprisonment for her role in a fraud scandal that resulted in bank losses of nearly US$470mn. 

The Singapore Police Force announced this week that Lim Beng Kim Lulu had been convicted of 11 counts of cheating, having deceived lenders into believing the commodity trader’s financial statements had been properly audited, as well as one charge of falsification of company accounts. 

Lulu Lim was found to have tricked 16 financial institutions into providing credit facilities worth at least US$586.5mn to Agritrade between January 2017 and November 2019, police say. 

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Agritrade went on to default on those loans, collapsing in February 2020. The announcement says losses associated with those charges totalled US$469.1mn, though at the time of its insolvency the trader owed creditors more than US$1.5bn in what lenders described as “massive, premeditated and systemic” deception. 

David Chew, director of the police’s Commercial Affairs Department, says the sentencing means Lulu Lim “face[s] justice for one of Singapore’s largest cases of trade financing fraud”. 

Investigations into Agritrade started as early as January 2020, the police statement reveals. Shortly after, Lulu Lim left Singapore, prompting cross-border agency Interpol to issue a ‘red notice’ calling for her to be located and provisionally arrested. She was tracked down in the UAE and returned to Singapore in September 2021. 

Investigators found that Lulu Lim was distributing “falsified financial statements” as early as January 2017, and for the accounts ending June 2018, had instructed an employee to include a copy of an auditor’s signature in a document that had not been audited. 

Police also reveal that the majority of funds drawn from credit facilities were transferred to three companies and their subsidiaries. Though the three companies were disclosed as legitimate commodity suppliers, they were “actually connected to [Agritrade] in a material fashion”. 

Lulu Lim and other members of the trader’s senior management were involved in the incorporation of those companies or had been employed as directors. 

“Various document templates and letterheads, as well as signature blocks and chops bearing the particulars of these three ‘suppliers’, were also discovered in [Agritrade’s] premises,” police say. 

Prior to being found guilty in December, Lulu Lim had faced at least 37 charges. The first of those, announced in September 2021, accused the former CFO of deceiving Shanghai Pudong Development Bank into paying out nearly US$20mn based on several invalid bills of lading.  

Later charges focused more on the misleading presentation of financial statements. 

The Agritrade case was the first in a series of trade finance fraud scandals to emerge in Singapore’s commodities sector during 2020. Within weeks, fellow trading giant Hin Leong collapsed amid accusations of a Ponzi-like fraud scheme that used falsified documents to cover up vast losses. 

Hin Leong founder Lim Oon Kuin has been charged with 128 counts of cheating by Singapore police, including the city-state’s first cheating charges based on invalid bills of lading. 

Lim has also been charged with deceiving eight financial institutions into providing receivables financing totalling US$1.2bn, among other alleged offences. 

The Singapore Police Force says it will “continue our efforts to safeguard Singapore’s reputation as a trusted business and financial centre” and “takes a tough stance against financial professionals and company officers who fail in their corporate duties and who abuse Singapore’s financial system to commit crime”. 

The announcement urges industry participants to report any knowledge or reasonable suspicion of fraud to authorities as early as possible. 

The post Agritrade executive jailed for 20 years for role in fraud scandal appeared first on Global Trade Review (GTR).

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