Jail for Singaporean man, the ‘second in command' of illegal operation of cross-border crypto transactions

The Star

3 hours ago

SINGAPORE (The Straits Times/ANN): From its premises in Geylang, a team operated an illegal business buying and selling large amounts of foreign currency and cryptocurrency.
Between Feb 1 and 23, 2023, the team provided cross-border money transfer services involving Singapore and foreign currencies of at least $35 million in value over no fewer than 430 transactions.
Following a police raid on the premises on Feb 23, 2023, the mastermind behind the operation, Singaporean Low Han Chuan, 44, fled the country.
On June 26, Javiour Chia Kit Hou, 34, whom the prosecution described as the second in command, was sentenced to 10 months' jail.
He had pleaded guilty earlier to one charge of abetment of the provision of an unlicensed payment service.
Deputy public prosecutors Shamini Joseph and Kiera Yu said that at some point, before June 2021, Low was introduced to a director of Sir Money Changer, a family-run company.
Low expressed an interest in starting his own money-changing and remittance business, and, after a discussion, the director agreed to let Low operate his business autonomously under Sir Money Changer's name from its premises at 12 Lorong 1 Geylang in exchange for $14,000 monthly.
Low would hire his own staff and pay their salaries, and while the contributions to the staff's Central Provident Fund accounts would be paid by Sir Money Changer, Low would have to reimburse it.
He was also required to record and submit the money-changing and remittance transactions performed at the Geylang premises to Sir Money Changer so that annual accounting returns could be filed together.
Low began business operations on the premises in September 2021.
While he used Sir Money Changer's name, he conducted his own business involving illegal cross-border money transfer services from the Geylang premises independently and without oversight from Sir Money Changer.
He did not have a licence from the Monetary Authority of Singapore (MAS) that allowed him to carry on such a business, and he was not an exempt payment service provider.
Low, who masterminded the operation and procured customers, was generally not physically present at the premises.
To run his business daily, he employed Chia; Malaysian Ho Jia Yi, 26; Singaporeans Peh Kian Tat, 46, Jacky Lim Teck Leng, 27, and Ng Yang Kai Don, 24, who is his nephew; as well as an unidentified person known as Vera.
Between September 2021 and February 2023, the crew operated the business of buying and selling large amounts of foreign currency and the USDT cryptocurrency.
Chia, who had a monthly salary of about $3,500, led the team and executed the daily operations of the business.
He would assign roles and responsibilities to the team, relay Low's instructions, procure customers for the business, execute the transfer of USDT, and supervise the recording of the transactions.
When a customer engaged the team's services, a group chat would be set up on WhatsApp or Telegram to facilitate communication between the team and the customer.
The team members were given work phones with a Cambodian number, which they used to communicate on the group chat.
Using the chat, customers would indicate the amount they wished to remit and the currency to be sent to the receiving bank account or intended recipient.
The team would then provide the buying or selling rate, and the amount that would be transferred to the recipient in the intended currency.
The customer would then agree to the deal or not.
After a deal was confirmed, the team would coordinate between its network of overseas and local agents to perform the remittance transaction by either transferring or receiving cash, or processing transfers to the recipients' bank accounts.
Once the transaction was completed, members of the team would record the details of the transaction in a spreadsheet, including the customer alias, the date of transaction, the amount and currency involved, and the conversion rate.
The prosecutors said the team did not carry out any know-your-customer or proof of funds checks or file cash movement reports despite being aware of the regulatory requirements to do so.
On Feb 21, 2023, a 58-year-old woman made a police report stating that she was a victim of a police impersonation scam and had been deceived into transferring at least $200,000 to two bank accounts.
Investigations revealed that $90,000 of the money was withdrawn by a 23-year-old Singaporean man who traded in cryptocurrency and was a member of a Telegram group chat along with Chia.
It was found that Chia had advertised cryptocurrency services on the group chat and the 23-year-old man had reached out to him to buy USDT.
The man was instructed to deliver the $90,000 in cash to the premises in Geylang, and received the USDT in his cryptocurrency wallet.
As a result of this transaction, investigators discovered the operations on the premises and arrested Chia, Peh and Ho.
Ng left Singapore on the same day to meet his uncle, and they both travelled to Cambodia.
Ng eventually returned to Singapore some time around June 1, 2023, while Low remains at large.
The prosecution asked the court to sentence Chia to between 10 and 12 months' jail.
They said there was a high level of sophistication in the operation, that Chia knew a licence was required by MAS and that he had obtained personal financial gain from the offence.
Chia's lawyers, Jeremy Pereira and Matin Razak of Withers KhattarWong, asked for a sentence of between seven and eight months' jail.
They said their client had been given an active role by Low in managing the operations as he was the only employee with a diploma working there, and he was good with numbers.
They said: 'It is clear that (Low), Javiour's employer, was the mastermind behind the entire scheme, not Javiour.
'Although Javiour oversaw the daily operations of the business, he acted purely on (Low)'s instructions.'
Chia could have been fined up to S$125,000, jailed for up to three years, or both. - The Straits Times/ANN