DBS puts up shophouses for sale to recover loans amid money laundering probe

Citi Commercial Pte Ltd

Ten shophouses owned by two Chinese nationals who were reportedly linked to an accused person in the $3 billion money laundering case have been put on the market by DBS Bank as it seeks to recover repayments of its loans.

The properties – estimated by observers to be valued at more than $100 million combined – were separately bought under Singapore-incorporated companies – Jiasheng Amoy and Suyh – wholly owned by Mr Su Binghai and Mr Su Fuxiang, respectively.

Checks by The Sunday Times in December 2023 found that both men, who are of interest to the police, left Singapore abruptly amid the anti-money laundering probe in 2023.

Information from the Accounting and Corporate Regulatory Authority (Acra) showed that DBS placed both firms into receivership in September 2023, after the owners failed to make debt payments.

DBS declined to comment when asked about the factors that led it to place the two firms into receivership.

The bank’s probe into the loans started in 2022, soon after the Commercial Affairs Department (CAD) launched investigations into a former Citibank employee for forgery-related offences in October 2021, and before a massive islandwide blitz led by the CAD that involved more than 400 officers.

The Government in October 2023 revealed that money laundering investigations had started in 2021, after the authorities became aware of the use of suspected forged documents to substantiate sources of funds in bank accounts in Singapore.

Mr Martin Wong of FTI Consulting was appointed as the receiver of both firms.

On Dec 1, 2023, FTI placed three separate advertisements in The Business Times, calling for expression of interest for 10 shophouses in Telok Ayer Street (one unit), Amoy Street (four units) and Geylang Road (five units).

BT reported on Jan 26 that three adjoining shophouses at 4, 5 and 6 Stanley Street in Chinatown, owned by Aalto Group, have also been put up for sale by tender at a guiding price of $61.6 million.

Aalto Group, a holding company whose sole director is Mr Su Fuxiang, has been placed in receivership and Knight Frank Singapore is marketing the units on behalf of the receiver, KPMG Services, appointed by DBS in September 2023. A mortgage under DBS was lodged in 2021.

When contacted, Mr Wong of FTI declined to comment on the receivership or status of the properties, citing confidentiality.

“Regrettably, this is confidential information, which I am not at liberty to share, save that interest in these properties exceeded my expectations,” he told ST.

Market observers said about 30 parties submitted offers for the 10 shophouse units listed by FTI before the deadline on Jan 15, 2024.

A property title search showed that in 2021, Jiasheng Amoy bought the 999-year leasehold three-storey unit at 182 Telok Ayer Street and four adjoining units of two-storey shophouses from 55 to 58 Amoy Street.

Mr Su Binghai is the sole director and shareholder of Jiasheng Amoy, according to Acra records.

ST reported in December 2023 that he was found to have business dealings with Cypriot national Wang Dehai, who is originally from China and has been charged with money laundering here.

Wang is a wanted man in China over his alleged links to an online gaming syndicate.

Singapore Land Authority records showed that Suyh bought the five adjoining units at 236 to 244 Geylang Road in 2021.

Mr Su Fuxiang, an associate of Mr Su Binghai, is the sole director and shareholder of Suyh, Acra records showed.

The units in Geylang are occupied by a coffee shop, a hairdressing salon, a Chinese restaurant and a tattoo shop.

An employee at the Chinese restaurant said he was not aware that the property had been put up for sale.

A Korean restaurant – Oven & Fried Chicken – currently occupies the unit in Telok Ayer Street, while fashion retailer Little Match Girl occupies units 55 and 56 in Amoy Street. The other two units are currently vacant.

Mr Can Heng, who runs Little Match Girl, said he renewed his tenancy for another three years from 2023. He declined to say whether he had done so before or after he was informed of the receivership in 2023.

The owner of a Vietnamese restaurant that had occupied the two now vacant units did not renew his tenancy and moved out towards the end of 2023, Mr Heng said.

“Recently, many people came to view the property, so I am not surprised that it was put up for sale. I believe whoever is buying the property will continue to honour the tenancy agreement,” he added.

Mr Heng was already operating from the unit before Jiasheng Amoy bought it in 2021.

Market observers noted that FTI’s listings of the 10 shophouses did not indicate a guiding price. They estimated them to be valued at more than $100 million combined.

Mr Richard Tan, founder of PropNex Shophouse Elites, which specialises in that market segment, said: “Based on the current market rate, all 10 units could be worth around $120 million.”

Some property agents told ST they have been wondering how the shophouses could be put up for sale amid the money laundering probe.

“I tried to ask FTI Consulting, but they said that they do not engage with agents. So I told my clients to submit their offers themselves,” said Mr Tan.

At least 10 foreigners have been arrested in Singapore’s largest anti-money laundering operations, with assets seized worth more than $3 billion.

The assets confiscated include 207 properties, 77 vehicles, money in bank accounts amounting to more than $1.45 billion, and cash in various currencies that are worth more than $76 million.

The properties are owned by individuals under investigation. Some of the properties are owned by the spouses or companies linked to the suspects.

It was previously reported that major banks including DBS were creditors to investment companies linked to the individuals arrested.

In 2021, the authorities detected signs of potential financial misconduct, including the use of suspected forged documents to validate fund sources in local bank accounts. Financial institutions and other companies filed suspicious transaction reports, prompting police investigations.

By early 2022, a comprehensive intelligence probe revealed an interconnected network of individuals believed to be involved in the alleged activities, with some linked by familial ties.

DBS chief executive Piyush Gupta disclosed that the bank had about $100 million in exposures to the money laundering case, involving mostly property purchases or retail customer accounts used to finance properties.

Checks by ST found that DBS registered two charges on Suyh as early as July 2022, and four charges on Jiasheng Amoy in February 2023, before news of the money laundering case broke in August 2023.

A charge is a form of security interest usually taken by a lender or creditor to secure repayment of a loan.

Timeline of events:

October 2021: Former Citibank employee Wang Qiming is investigated by the Commercial Affairs Department (CAD) for forgery-related offences. Money laundering investigations start after the authorities become aware of the use of suspected forged documents to substantiate sources of funds in bank accounts in Singapore.

Early 2022: Police launch an extensive intelligence probe that uncovers a web of people believed to be connected to one another, with some associated by familial ties.

July 2022: DBS Bank registers two charges on Suyh, owned by Chinese national Su Fuxiang.

February 2023: DBS registers four charges on Jiasheng Amoy, owned by Su Binghai.

Aug 15, 2023: Police conduct a massive islandwide blitz led by the CAD that involves more than 400 officers. Nine men and one woman are arrested and charged the next day with various offences, including money laundering, forgery and resisting arrest.

September 2023: DBS appoints FTI Consulting as the receiver for Jiasheng Amoy and Suyh and takes possession of the assets of the two companies in an attempt to recover mortgage loans.

Dec 1, 2023: FTI puts up 10 shophouses separately owned by the two companies for sale by expression of interest.

Jan 15, 2023: Deadline for the submission of the expression of interest.

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