Jail for man in Singapore who used bogus wine investment scheme to pocket S$12.67mil of investors' funds
SINGAPORE: A man, who set up a company that dealt with wines, and an alleged accomplice devised a fraudulent investment scheme involving the beverage to cheat over 200 investors of millions of dollars between 2008 and 2011.
Based on police investigations, victims linked to the company's fraudulent sale of wines paid more than S$14 million in total.
Eldric Ko, 51, who incorporated Premium Liquid Assets (PLASG) in October 2005 and jointly ran its business with Koo Han Jet, went on to misappropriate $12.67 million of the investors' funds.
Deputy Public Prosecutor Michelle Tay said that Ko, a Singaporean, then squirreled away $8 million for his and Koo's personal benefits.
On Thursday (May 22), Ko, who has not made any restitution, was sentenced to seven years and two months' jail after he pleaded guilty to one count of criminal breach of trust (CBT) involving more than $10 million, and two counts of dealing with his ill-gotten gains.
Twelve other charges were considered during his sentencing. Koo is still at large after he left Singapore in May 2011.
DPP Tay told the court that Ko was PLASG's sole director and shareholder until Jan 2, 2009. After that, he installed his stepfather as its nominee director, even though the latter played no role in the company's business.
Court documents stated that PLASG offered wine investment schemes to members of the public, purporting to source for wine from various suppliers in France and sell the beverage to investors.
After operating the business for a few years, Ko realised that PLASG was selling more wine than what the company could purchase.
Part of the reason was because the business was not making enough profits to cover its costs for items such as marketing and rental.
DPP Tay said: 'The accused knew that, with the way that he and Koo were running PLASG's business, PLASG had growing liabilities to its investors, which were more than PLASG's assets, and which PLASG could not fulfil.
'In the accused's words, there was a 'hole' that kept getting bigger.'
She added that in response to PLASG's growing liabilities to investors, the pair devised the 'En Primeur (EP) wine investment scheme' under the company in 2008.
The prosecutor said that the two men then entered into a conspiracy to trick investors into believing that PLASG would transfer ownership of EP wines to them.
The investors would be dishonestly induced to deliver monies to PLASG for the purchase of these EP wines.
DPP Tay said: 'The accused and Koo never intended the EP scheme to be a genuine wine-selling scheme... (They) never intended to purchase the EP wines that they had purported to sell to investors, and they, in fact, never sourced for EP wines from any suppliers.'
According to court documents, the two men then entered into a conspiracy to commit CBT by misappropriating the investors' funds under the EP scheme.
On Aug 7, 2008, Ko incorporated a shell entity in the British Virgin Islands called Grand Millesimes Limited (GML), which had no actual business activities and was not a real wine supplier.
The prosecutor said the two men agreed to use GML as a fictitious supplier of wines for the EP scheme.
She added that as part the conspiracy, Koo forged invoices issued by GML, which purported to be for the sale of wine to PLASG before sending these invoices to Ko.
Ko then used these forged invoices to justify his transfers of EP investors' funds from PLASG's bank account to another one in Switzerland belonging to GML.
After that, he transferred the ill-gotten gains from the Swiss account to a third account in Singapore.
DPP Tay said: '(Ko) deliberately chose to layer his funds transfers in this manner... because he believed that the Singapore police would not be able to obtain information about his overseas account and the illicit transactions.
'After the accused transferred the monies to (the third bank account), he distributed Koo's share of their illicit benefits from their criminal breach of trust offence... through illegal money remittance businesses and in cash.'
Among other things, Ko misappropriated over $10 million in total between February and October 2009.
Court documents did not disclose how the offences came to light but from May 2011, the police received more than 240 reports against PLASG over its fraudulent sale of wines.
Koo left Singapore on May 3, 2011, and Ko did the same 25 days later before the police started investigating the case.
Ko's bank account in Switzerland was closed in November that year.
He was arrested when he finally returned to Singapore in May 2024. Reasons for his return were not stated in court documents. - The Straits Times/ANN
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