Commercial Affairs Department appears to be stuck with seized money from Sunshine Empire for 16 years

The case dates back to when Sunshine Empire, led by James Phang Wah, swindled thousands of Singaporeans into purchasing nearly 26,000 “lifestyle packages” for 15 months between Aug 2006 and Nov 2007, lured by the promise of high returns at little to no investment risk.

Entrepreneur James Phang Wah, who owned the firm, was found guilty of criminal breach of trust in  June 2010. He subsequently served a nine-year prison sentence and paid a S$60,000 fine.

Phang was then extradited to Malaysia after the end of his jail term, after which he stood trial in Dec 2011 for violating Malaysia’s Banking and Financial Institutions Act due to accepting illegal deposits.

Sunshine Empire was charged in Malaysia in March 2009 under the same act for accepting deposits from the public without a valid licence. The company pleaded guilty and was fined RM2 million in June 2010.

Jackie Hoo Choon Cheat, Sunshine Empire’s director, was handed a seven-year jail term in Singapore. In August 2016, he was charged in Malaysia with the same offences upon being released from Singapore prison.

Phang’s wife, Neo Kuon Huay was fined S$60,000 for falsifying payment vouchers.

Phang and Hoo appealed to the Court of Appeal to have their case reviewed, but the court upheld the duo’s convictions in Sep 2012.

Recent inquiries into the status of the liquidation process have highlighted the ongoing delays and lack of communication from the authorities.

Terry Xu, Chief Editor of The Online Citizen, emailed the relevant authorities on 27 June 2024, seeking updates on the status of the funds after the liquidation of Sunshine Empire was handed over to PricewaterhouseCoopers (PwC) to manage in 2022.

Victims were informed that processing the claims would take a year.

The email emphasized several critical questions:

1. Current Status of the Liquidation Process: Xu inquired about any significant progress in the review and adjudication of Proof of Debts (PODs) since the last update in April 2023. Previously, PwC had informed that with over 8,000 investors, the review process was ongoing and was expected to take up to a year. Xu sought clarity on whether this process had seen any advancement.
2. Expected Timeline for Completion: Xu requested a revised timeline for the completion of the liquidation process and the distribution of funds to creditors, given that the initial estimated timeframe had already passed.
3. Communication with Creditors: The inquiry also asked whether any creditors had been contacted for additional information or documents and whether any notices of admission or rejection had been issued.
4. Proportionate Distribution of Assets: Xu sought clarity on the proportion of the accepted claims that creditors can expect to receive based on the remaining assets, highlighting the need for transparency in the distribution process.

Despite these pressing questions, no response has been received from the authorities.

The CAD’s position has been ambiguous and passive over the years.

CAD’s position to the victims in 2013 was that it was “attending to matters concerning the disposal of the seized monies” and that the process to lodge a claim would be posted on its website when the matters had been finalised.

In 2014, the department stated it was “working towards finding an appropriate process to dispose of the assets seized” and that the matter was in its “advanced stages.” However, similar reassurances have been given multiple times, with little tangible progress.

“Since then, we have been working towards finding an appropriate process to dispose of the assets seized,” said the department in an email on 16 June 2014, noting that it would entail a complicated process as this is one of its largest seizures and the number of potential claimants involved is “unprecedented”.

“We have since involved different agencies in our deliberation. Admittedly, this has taken some time,” CAD added, stressing that it is in “the advance stages of finalising the matter” and has not “neglected the concerns of the investors”.

In 2017, the Singapore Government confirmed it was still “safekeeping” the S$21 million, with no clear decision on how to manage the funds.

The CAD’s website, which once provided updates, was taken offline in 2016, adding to the victims’ concerns about the transparency and efficiency of the process.

Discussions on online forums reveal that CAD had instructed victims to wait for further instructions, stating that the funds could not be dealt with pending court proceedings.

It is puzzling why CAD sat on the matter for so long without contacting the victims for more information before passing the claims process to PwC, which then had to pick up the pieces from CAD.

With the likelihood of no existing documents after 16 years and no clear records kept by the victims or supposedly by the authorities, the chances for victims to recover their lost money appear slim.

FAQ from the Commercial Affairs Department to victims on its removed website.