Judge says ex-director Goh Jin Hian did not take reasonable steps to probe red flags raised in IPP
Goh in February was found liable for breach of director’s duties, statutory duties and losses suffered by the firm amounting to US$146 million plus interest. He is appealing the decision by the High Court
A former director of insolvent marine fuel supplier Inter-Pacific Petroleum (IPP), Goh Jin Hian, had not taken “reasonable steps”, such as making necessary inquiries, when various red flags surrounding the company arose, said High Court Justice Aedit Abdullah in his grounds of decision released on Thursday (Jul 11).
Goh was also unaware of the existence of IPP’s cargo trading business, despite being a director of the company, and therefore did not know this business was a fraudulent scheme perpetrated by IPP, said the justice. This comes after Goh in February was found liable for breach of director’s duties, statutory duties and losses suffered by the firm amounting to US$146 million plus interest. Goh, who is the son of former prime minister Goh Chok Tong, has since appealed the decision.
The liquidators of IPP had sued Goh to recover US$156 million in losses, accusing him of “sleepwalking through his time as a director” and failing to discover and stop drawdowns in trade financing between June 2019 and July 2019 to fund alleged non-existent or sham transactions. Goh had served as a director of IPP from Jun 28, 2011, to Aug 20, 2019.
related:
Ex-IPP director Goh Jin Hian ignorant of cargo trading business that was ‘vehicle of fraud’: Court
Dr Goh Jin Hian said the suit is a “blatant attempt to scapegoat him”, as he was “not involved in any sham transactions”.
The High Court has found that Goh Jin Hian, a former director of insolvent marine fuel supplier Inter-Pacific Petroleum (IPP), is not entitled to relief from liability to pay US$146 million (S$196 million) plus interest in compensation for losses suffered by the firm. This is due to “the egregiousness of his breaches of duty, chief among which was his ignorance as to IPP’s cargo trading business” – a “vehicle of fraud” that had “disastrous consequences” for the company – Justice Aedit Abdullah ruled in his 170-page grounds of decision issued on July 11.
Goh, the son of former prime minister Goh Chok Tong, served as a director of IPP from June 28, 2011, to August 2019. His breach of duty “entailed an extent of carelessness or imprudence that struck at the very heart of his duty of skill, care and diligence”, said the judge. In declining to grant Goh relief from liability, Justice Abdullah said: “The mere fact that Dr Goh had not been a perpetrator of the fraud did not mean that he was not responsible for its disastrous consequences on IPP.
“It was through his combination of misfeasance and nonfeasance, in failing to even be aware of IPP’s cargo trading business, that the fraudsters were able to use IPP’s cargo trading business as a vehicle of fraud in the first place.” He ordered Goh to pay costs of $332,545 plus $94,301 in disbursements.
related:
Banks Seek Fund Recovery From Ex-Singapore PM's Son
Former Singapore Prime Minister Goh Chok Tong's son is being sued for breaching director's duties during his time as director of Singapore marine fuel and cargo trader Inter-Pacific Petroleum (IPP).
Goh Jin Hian, who was IPP's director from 2011 to 2019, is being sued by its judicial managers Deloitte & Touche for over $156 million including interest, «The Straits Times» reported earlier this week (behind paywall). The firm's largest creditors Maybank and Societe Generale, who are owed $88.3 million and $81.3 million respectively, are funding the suit, which was filed last Friday.
According to court documents, the $156 million was from drawdowns of trade financing between June and July 2019, which banks alleged were «non-existent or sham transactions. The firm lost its operating license earlier this year and was placed under judicial administration amid financial stress. The losses at SocGen resulted in the departure of its co-heads of trade and commodities finance for Asia-Pacific. In failing to prevent IPP from applying to SocGen and Maybank for drawdowns, at the time when IPP was insolvent, the defendant had acted in breach of his fiduciary duty to the plaintiff to take into account the interests of [IPP’s] creditors to ensure that the plaintiff’s assets are not dissipated or exploited to the prejudice of the creditors’ interests, the suit said.
Goh Jin Hian considering appeal after court says he’s liable for close to S$200M in IPP lawsuit
Former Prime Minister Goh Chok Tong’s son, Goh Jin Hian, is reportedly considering appealing a High Court ruling that found him responsible for breaching his director’s duties at troubled bunker supplier firm Inter-Pacific Petroleum (IPP). High Court Justice Aedit Abdullah found Goh liable for breach of director’s duties, statutory duties, and losses suffered by the insolvent marine fuel supplier amounting to US$146 million (S$196 million), plus interest.
The 55-year-old, who served as a director of IPP from June 28, 2011, to Aug 20, 2019, was accused by liquidators of “sleepwalking through his time as a director.” The lawsuit aimed to recover US$156 million in losses, alleging that Goh failed to prevent drawdowns in trade financing between June and July 2019 for alleged non-existent or sham transactions.
The trade financing, totalling US$146 million, originated from IPP’s largest creditors – Malayan Banking (Maybank) and the Singapore branch of Societe Generale. Additionally, US$10.5 million was drawn from Societe Generale’s facility for IPP’s bunkering operations during a period of alleged balance-sheet insolvency. Interestingly, Goh held 36 directorships simultaneously between 2017 and August 2019.
Singapore ex-PM’s son found liable for millions lost by company
Goh Jin Hian, CEO of Singapore's New Silkroutes Group Ltd, poses for pictures during an interview in Beijing, China, October 17, 2016. Picture taken October 17, 2016. REUTERS/Aizhu Chen (REUTERS / Reuters)
Singapore’s High Court has found Goh Jin Hian liable for $146 million in losses under his watch as director of a now-insolvent marine fuel supplying company, adding to the legal problems facing the son of former Prime Minister Goh Chok Tong.
Doing his duties “would have led him to realize that the company was being defrauded,” Justice Aedit Abdullah said in published remarks dated Jan. 24 on a petition involving Inter-Pacific Petroleum Pte. The defense argued there was no such breach or causation of loss, and regardless, the company qualifies for relief from liability under the companies act. “The financial position of the company was suspect and should have primed the defendant to look further and obtain a picture of the true state of the affairs of the company and monitor what was happening within it,” the judge said. “That was his duty as a director.” “Loss was caused to the plaintiff through the transactions and drawdowns which should not have been carried out and would not have been had the defendant performed his duties,” the judge said.
The development comes amid a number of scandals in the Asian financial hub known for its zero tolerance for corruption. A separate billion-dollar money laundering probe is already shining a light on fund flows from abroad and raising questions about loopholes that enabled an alleged criminal syndicate to accumulate massive amounts of wealth. Goh, 55, served as a director of Inter-Pacific Petroleum from 2011 to 2019, Channel News Asia reported. He was among four people charged last year with false trading offenses linked to investment holding company New Silkroutes Group Ltd. They are accused of creating a “misleading appearance with respect to the price” of its securities on 31 trading days between February and August of 2018. That’s equivalent to market manipulation.
Former IPP director Goh Jin Hian found liable for US$146 million in losses by company
"An honest and reasonably diligent director would have persisted and probed further," said the judge of Goh Jin Hian's lack of action amid the company's financial troubles
Goh Jin Hian has been found liable for US$146 million (S$196 million) in losses as director of now-insolvent marine fuel supplying company Inter-Pacific Petroleum (IPP). In brief remarks obtained by CNA on Tuesday (Feb 6), Justice Aedit Abdullah ruled in favour of IPP, which had sued Goh, who is the son of former Prime Minister Goh Chok Tong, for breaching his director's duty.
IPP's claim was that Goh, 55, had failed to look into certain issues which would have led him to realise that the company was being defrauded. In his defence, Goh claimed that there was no breach, no loss caused and he claimed relief from liability under the Companies Act. In his brief remarks issued on Jan 24, ahead of a full judgment that has yet to be released, Justice Abdullah said Goh had an obligation to oversee the affairs of the company as a director.
"The obligation is to monitor the affairs of the corporation," he said. "This entails, among others, at least broad level supervision of the activities of the officers of the corporation, for the protection of the company, shareholders and creditors." The judge said the evidence showed that Goh played an active role in the management of the company and had assumed responsibilities and obtained knowledge and information.
Former IPP director Goh Jin Hian liable for US$146m losses suffered by company: High Court
Goh Jin Hian outside the State Courts on Sept 20, 2023. Goh was on Jan 24 found liable for breach of director’s duties, statutory duties and losses suffered by IPP. PHOTO: SHIN MIN DAILY NEWS FILE
The High Court has found Goh Jin Hian, a former director of insolvent marine fuel supplier Inter-Pacific Petroleum (IPP), liable for breach of director’s duties, statutory duties and losses suffered by the firm amounting to US$146 million (S$196 million) plus interest.
The liquidators of IPP had sued Goh to recover US$156 million in losses, accusing him of “sleepwalking through his time as a director” and failing to discover and stop drawdowns in trade financing between June 2019 and July 2019 to fund alleged non-existent or sham transactions. The 55-year-old served as a director of IPP from June 28, 2011, to Aug 20, 2019.
According to the liquidators, the trade financing came from IPP’s two largest creditors – Malayan Banking (Maybank) and the Singapore branch of Societe Generale (SocGen). It consisted of US$146 million drawn down for cargo trading operations, and US$10.5 million drawn from SocGen’s facility for IPP’s bunkering operations allegedly when IPP was balance-sheet insolvent. High Court Justice Aedit Abdullah, in brief remarks issued on Jan 24, detailed the responsibilities of a company director. He noted that while a director is not an internal auditor checking every singular detail, the obligation is to monitor the affairs of the corporation.
Goh Chok Tong's son Goh Jin Hian charged with false trading offenses
Goh Jin Hian, then CEO of New Silkroutes Group, photographed in September 2018
Goh Jin Hian, the only son of former Singapore Prime Minister Goh Chok Tong, was among four people charged Wednesday with false trading offenses, Channel News Asia reported.
The 54-year-old ex-chief executive officer of investment holding company New Silkroutes Group Ltd., Goh stands accused of conspiring with three other men linked to the firm for creating a misleading appearance of the price of its securities on 31 trading days between February and August of 2018, according to the report.
Goh is also accused of pushing up the price of the company’s securities by placing orders and executing trades using his bank investment account. He was handed 39 charges under the Securities and Futures Act, while the three other men each received 31 similar charges. Goh and the three others charged could face a jail term of up to seven years and a fine of as much as S$250,000 ($183,000), or both, on each charge.
Son of former PM Goh Chok Tong in CAD probe
Seba Director Goh Jin Hian Bows Out Amid Scandal
Former Singapore Prime Minister Goh Chok Tong's son is being sued for breaching director's duties during his time as director of Singapore marine fuel and cargo trader Inter-Pacific Petroleum (IPP).
Goh Jin Hian, who was IPP's director from 2011 to 2019, is being sued by its judicial managers Deloitte & Touche for over $156 million including interest, «The Straits Times» reported earlier this week (behind paywall). The firm's largest creditors Maybank and Societe Generale, who are owed $88.3 million and $81.3 million respectively, are funding the suit, which was filed last Friday.
According to court documents, the $156 million was from drawdowns of trade financing between June and July 2019, which banks alleged were «non-existent or sham transactions. The firm lost its operating license earlier this year and was placed under judicial administration amid financial stress. The losses at SocGen resulted in the departure of its co-heads of trade and commodities finance for Asia-Pacific.
