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Argus Media: Hontop Energy fraud allegations add to Singapore trading woes

BP told CIMB[…] that the purported contracts between it and Hontop appeared to be ‘fabrications’ and CIMB is ‘apparently a victim of Hontop’s fraudulent conduct’.

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Kevin Foster of global energy and commodity price reporting agency Argus Media on Tuesday (7 July) published an article outlining details of Malaysian Bank CIMB’s court filing accusing Hontop Energy (trading arm of Chinese independent refiner China Wanda Holding Group Co Ltd) of fraudulent transactions: 

More details are emerging about the collapse of Singapore-based Hontop Energy earlier this year, adding to pressure on the country's embattled commodity trading sector.

Malaysian bank CIMB filed an application to the Singapore high court last week for trading company Hontop to be placed under judicial management — a form of debt restructuring. CIMB provided trade financing to Hontop for crude and products cargoes, court documents show.

Hontop is one of four Singapore-based trading companies to have collapsed this year, together with oil traders Hin Leong and Zenrock and coal trading firm Agritrade. Hontop, which went into receivership in February, is fully owned by Chinese private-sector firm Wanda whose group assets include the 100,000 b/d Tianhong independent refinery in Shandong province.

Hontop blamed its problems on the impact of the Covid-19 pandemic on Chinese oil demand, as well as moves by banks to tighten credit lines to Chinese independent refineries following a default by a large copper smelter, Fangyuan, in December. It had outstanding liabilities of around USD 473mn to banks and about USD 60mn to other unsecured creditors as of the end of February, according to a filing for court protection that was made in early March and included in the CIMB court documents.

Suspicious transactions

Hontop laid out a plan to restructure its debts as part of the filing. But CIMB, which the court records show is Hontop's biggest creditor at USD 105mn, said it has a "complete loss of confidence" in the company's management. It accused Hontop of engaging in "suspicious transactions" involving two cargoes of Russian ESPO Blend crude late last year, the court documents show. Both cargoes were bought from Singapore trading firm Sugih Energy, now known as Aeternum Energy, and sold to BP.

The first cargo, of around 476,000 bl, was shipped on the Aframax tanker Green Attitude to Yosu in South Korea, while a second 1mn bl cargo was shipped on the very-large crude carrier Gem No.5 to Shandong. CIMB issued letters of credit (LCs) to Hontop for both transactions.

CIMB paid Sugih under the LC for the first cargo, but after approaching BP to collect payment was told that the cargo was subject to a separate framework agreement between BP and Hontop. BP said it had not received payment from Hontop and so was not obliged to pay CIMB for the cargo, according to the court filing.

CIMB also provided financing for the second cargo. BP later informed CIMB that it had not entered into any contract with Hontop for the cargo and so was not required to make payment.

BP told CIMB through its solicitors in March that the purported contracts between it and Hontop appeared to be "fabrications" and that CIMB is "apparently a victim of Hontop's fraudulent conduct", according to a letter included in the court filing.

BP declined to comment. CIMB did not reply to a request for comment, while Hontop could not be reached.

Fraud allegations

The allegations against Hontop mean that all three of the Singapore oil trading companies that have collapsed so far in 2020 have now been accused in court documents of fraudulent activity relating to cargo financing.

Hin Leong overstated the quantity of inventory on board vessels when obtaining inventory financing, and secured financing by pledging cargoes that it did not own or did not exist, according to a court filing last month by its judicial manager PricewaterhouseCoopers. The company also concealed derivatives trading losses of over $800mn in the past 10 years, the filing shows.

UK bank HSBC has accused Zenrock of dishonestly obtaining multiple sources of financing for crude cargoes, according to a separate court filing.

Bank losses

The details in the Hontop court filing also take to around USD 4bn the amount that banks and other creditors stand to lose as a result of the company collapses. China's Citic Bank and France's Natixis and Societe Generale are the next-biggest creditors to Hontop, at USD 82mn, USD 81mn and USD63mn respectively, according to the court filing.

Banks are on the hook for the majority of the USD 3.5bn that Hin Leong owes to its creditors, while Zenrock owes around USD 165mn to lenders.

Dutch bank ABN Amro booked an impairment charge of EUR 225mn (USD 253mn) related to Hin Leong in May and warned that it was not confident of recovering its losses.

Singapore banks said this month they are working with the government to review financing standards for the commodity sector.


Source and photo credit:
Argus Media
Published: 8 July, 2020

 

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Business

Lloyd’s List Intelligence acquires Infospectrum to drive maritime risk intelligence solutions

Combined business will enable LLI to build solutions that deliver actionable insights and help maritime customers successfully navigate key use cases associated with compliance, risk management and operations.

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Lloyd’s List Intelligence acquires Infospectrum to drive maritime risk intelligence solutions

Maritime data, insights and analytics provider Lloyd’s List Intelligence (LLI) on Tuesday (14 January) announced the acquisition of Infospectrum, an independent provider of counterparty risk appraisal reports & data, due diligence research and KYC intelligence.

The acquisition expands LLI’s ability to deliver analysis and risk management intelligence solutions. 

The integration of Infospectrum’s comprehensive counterparty risk appraisal, due diligence and KYC intelligence capabilities and data, will enable the combined business to provide customers with more accurate, reliable, and timely risk based decision-making solutions. 

With the maritime sector facing increasing complexity from global sanctions, compliance, safety, geo-political and legal considerations, the combination will enable LLI to build solutions that deliver actionable insights and help customers successfully navigate key use cases associated with compliance, risk management and operations.

“The acquisition of Infospectrum is an important milestone for Lloyd’s List Intelligence,” said Michael Dell, CEO, Lloyd’s List Intelligence. 

“This acquisition is a significant step forward in our mission to provide the most comprehensive and insightful risk intelligence solutions that support the global maritime industry. By combining our respective strengths, we will deliver stronger capabilities to our customers and enhance our ability to act as a provider of mission critical data, insights and analytics for the maritime sector as a whole.”

“We are excited to join forces with Lloyd’s List Intelligence,” said Panos Panousis, Managing Director, Infospectrum. 

“This combination will unlock significant opportunities for both companies and provide the maritime ecosystem with access to a broader range of data, analytics, and intelligence. We are confident that together we will accelerate innovation and deliver exceptional solutions to the maritime industry.”

 

Photo credit: Lloyd’s List Intelligence
Published: 14 January, 2025

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Legal

Shell MGO bunker heist: Bunker clerk gets jail time for helping Sentek acquire misappropriated fuel

Wong Wai Meng was sentenced to seven years, four months and two weeks’ jail on 10 January for helping the company acquire more than 28,000 mt of the misappropriated fuel worth USD 13.58 million.

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RESIZED Ekaterina Bolovtsova on PEXELS

A bunker clerk, who was previously employed by Sentek Marine & Trading (Sentek), was sentenced to seven years, four months and two weeks’ jail for helping the company acquire more than 28,000 metric tonnes (mt) of the misappropriated fuel worth USD 13.58 million (SGD 18.26 million), The Straits Times reported on Friday (10 January).

Wong Wai Meng, was working for Singapore-based firm Sentek at the time of the offences. 

Wong, who received more than USD 286,000 from the company for his assistance, pleaded guilty in November 2024 to 12 counts of intentionally helping the company acquire the misappropriated fuel.

He committed the offences over 46 occasions between August 2014 and December 2017.

Wong is among the three bunker clerks previously employed by Sentek, who were charged for offences under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA) and the Prevention of Corruption Act (PCA).

Another bunker clerk among the three charged, Wong Kuin Wah, 61, was sentenced to seven years and six months’ jail on 18 November for his role in misappropriating more than 27,000 tonnes of gas oil worth around USD 12.8 million (SGD 17.2 million).

The third individual who was charged, Boo Pu Wen, reportedly passed away in July 2023 and had his charges abated following his death, meaning Boo’s court proceedings over his 19 charges at the time came to an end. 

Former Shell employees, who were key members of a group who dishonestly misappropriated fuel from Shell Pulau Bukom, were sentenced to jail in court earlier.

Earlier coverage of developments by Manifold Times regarding the Shell MGO bunker heist can be found below:

Related: Shell MGO bunker heist: Bunker clerk pleads guilty to helping Sentek acquire misappropriated fuel
Related: Shell MGO bunker heist: Ex-Shell employees sentenced to more than 23 years in prison each
Related: Shell MGO bunker heist: Ex-Shell employees plead guilty to multiple offences
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Related: Shell MGO bunker heist: Ex-Intertek Surveyor sentenced to four months’ jail for corruption
Related: Shell MGO bunker heist: Ex-Intertek Surveyor pleads guilty to corruption charge
Related: Shell MGO bunker heist: Shell Process Technician receives 195-month jail sentence
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Related: Shell MGO bunker heist: Ex-Shell blending specialist jailed over USD 956,000 worth of misappropriated gasoil
Related: Shell MGO bunker heist: Former Intertek, Inspectorate surveyors receive fines, jail sentences
Related: Shell MGO bunker heist: Ex-CCIC Singapore surveyor pleads guilty to misconduct, receiving USD 12k in bribes
Related: Shell MGO bunker heist: Ex-Process Technician receives 184-month prison sentence over illicit involvement
Related: Shell MGO bunker heist: Syndicate member’s nephew jailed over concealment of safe containing valuables
Related: Shell MGO bunker heist: 12 former surveyors from Intertek, Inspectorate, CCIC, SGS charged for corruption
Related: Shell MGO bunker heist: Former Shore Loading Officer receives 29-year jail sentence over total 85 charges
Related: Shell MGO bunker heist: Ex-Process Technician received minimum SGD 735,000 in benefits, faces 43 charges
Related: Shell MGO bunker heist: Ex-Shell employee admits leading role in illicit operation
Related: Shell MGO bunker heist: Sentek ex-Director faces 40 fresh charges
Related: Shell MGO bunker heist: Two former Shell employees jailed over theft
Related: Shell MGO bunker heist: High Court affirms ‘Prime South’ forfeiture to Singapore State
Related: Shell MGO bunker heist: Three ex-Shell employees charged with bribing surveyors
Related: Shell MGO bunker heist: Second ex-Shell employee pleads guilty to nine charges
Related: Shell MGO bunker heist: First ex-Shell employee to plead guilty over involvement
Related: Shell MGO bunker heist: Director of Singapore bunkering firm released from police custody
Related: Shell MGO bunker heist: Oil tanker ‘Prime South’ forfeited by State Courts of Singapore
Related: Shell MGO bunker heist: Director of Singapore bunkering firm face charge at State Courts
Related: Shell Singapore oil heist: Third offender pleads guilty for gas oil theft
Related: Captain of “Prime South” jailed in Shell Pulau Bukom gas oil theft
Related: Shell Singapore oil heist: Ex-Chief Officer of Prime South jailed
Related: Singapore: Shell MGO bunker heist amount balloons to USD$142 million
Related: Shell MGO bunker heist update: Fresh charges issued at Singapore court
Related: Shell Singapore oil heist: More charges issued at court
Related: Shell Singapore oil heist: Breakdown of stolen oil cargoes
Related: Intertek Singapore employee among Shell oil heist suspects

 

Photo credit: Katrin Bolovtsova
Published: 13 January, 2025

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Winding up

Singapore: Liquidator issue notice of intended dividend for Parakou Shipping

Creditors will need to produce proofs of debt to liquidator of Parakou Shipping by 24 January, according to Government Gazette notice.

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calculator steve pb from Pixabay

A notice to declare intended dividend of Parakou Shipping Pte Ltd to its creditors has been posted on the Government Gazette on Friday (10 January).

The following are the details of the notice of intended dividend for the first dividend:

Name of Company : Parakou Shipping Pte Ltd (In Creditors’ Voluntary Liquidation)

Address of Registered Office : c/o KordaMentha, 16 Collyer Quay, #30-01, Singapore 049318

Last Day of Receiving Proofs : 24 January 2025 (if not already lodged)

Name of Liquidator : Cameron Duncan

Address : c/o KordaMentha, 16 Collyer Quay, #30-01, Singapore 049318

 

Photo credit: steve pb from Pixabay
Published: 13 January, 2025

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