Yuen Law’s white-collar criminal defence lawyer Lim Yun Heng was asked to share if there are any protections available for directors acting honestly, and if corporate service providers could face penalties for negligence.
The case entails the unauthorised use of a Singaporean’s information to register a company involved in a cryptocurrency scandal
A Singaporean man found himself in a distressing situation when he discovered that his personal information had been used without his consent to register four companies. One of these companies, a cryptocurrency investment firm, was under scrutiny for mishandling over US$1.5 million in withdrawals from US investors. The man, a facility maintenance manager, was surprised to learn that he was listed as a director, a role he claimed no knowledge of undertaking. The man suspects that his personal information was stolen when he lost his wallet overseas.
Asked if someone who had his personal details used without his consent, to incorporate a company, could be held liable if the business is implicated in criminal activities, associate director Lim Yun Heng said the question is if a director had acted honestly and reasonably in the circumstances.
Companies can be registered in Singapore by foreigners through registered filing agents, which include corporate service providers. It is unlikely that filing agents will face charges if they are found to be merely negligent, he said. If they had acted honestly and reasonably in the circumstances, it is unlikely that a criminal offence can be made out.
It is also worthwhile to note that the Accounting and Corporate Regulatory Authority (Filing Agents and Qualified Individuals) Regulations 2015 provides that “serious negligence” as opposed to mere negligence is a basis for refusing the registration of a filing agent on the basis that they are not “fit and proper” persons. The regulations also provide similar punishments for the furnishing of false information.
Combating the Misuse of Nominee Directorship Arrangements
On 12 March, The Ministry of Finance and Accounting and Corporate Regulatory Authority have proposed a new Corporate Service Providers (CSP) Bill to enhance the regulatory regime for the CSP sector, the bill seeks to address the misuse of nominee directorship arrangements by prohibiting persons from acting as nominee directors by way of business unless the appointments are arranged by registered CSP, and they have been assessed as fit and proper by the registered CSP.
Read the full article here.
If you would like information and/or assistance on white collar criminal defence matters, you may contact:
Lim Yun Heng
Associate Director – Dispute Resolution
T: +65 6536 6037
E: yunheng@yuenlaw.com.sg
Click here to view Yun Heng’s CV.
