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Founder OK Lim grilled by prosecutors on his involvement at Hin Leong Trading

Prosecutors accused Lim, who is accused of alleged cheating and forgery charges involving USD 111.7 million (SGD 148.7 million), of lying and playing down his involvement in the company’s dealings.

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RESIZED state courts

Prosecutors grilled Hin Leong Trading (Pte) Ltd Founder Lim Oon Kuin, who is accused of alleged cheating and forgery charges involving USD 111.7 million (SGD 148.7 million), over his role in the company at the Singapore State Courts on Monday (20 November), according to The Business Times

Prosecutors accused him of lying and playing down his involvement in the company’s dealings. 

During cross-examination, Deputy Public Prosecutor (DPP) Christopher Ong questioned Lim of his involvement in the company’s day-to-day operations until he stepped down as the managing direction in April 2020.

Lim said Hin Leong traders would inform him only “as a matter of formality” when asked if he would give approval to them for trades they conducted. 

“If the deal is profitable and they are earning money for the company, of course they can do (the deals). They just informed me as a matter of formality that they have completed the deal,” Lim said as quoted by The Business Times.

In June, Hin Leong’s general manager for trading Wong See Meng had testified in court that he would get approval or in-principle approval from Lim or members of the Lim family for any deal that he wished to carry out. He added that he would get approval from Lim for deals involving gas oil and aviation fuel. 

When asked by DPP Ong whether Wong had asked Lim for directions on whether sale deals should proceed, Lim disagreed. 

Lim said: “He is holding such a senior position. If he needed to ask me before he could proceed, then what is the point of employing him?” 

DPP Ong then suggested that Lim was lying when he said he did not approve the trades that Hin Leong conducted. Lim disagreed. 

Lim also denied knowing what the term “discounting” meant when queried on discounting facilities that Hin Leong had with several banks including HSBC.

DPP Ong asked Lim whether he was aware that Hin Leong had a facility with HSBC where Hin Leong could present invoices for oil sales that it had made, and the bank would pay the company before payment from the buyer was due. 

Lim said such things were “accounts matters”, and that he was never involved in accounts matters.

“I put it to you that your claim not to have known what discounting was, all the way up to April 12, 2020, is completely incredible,” DPP Ong said, to which Lim disagreed.

DPP Ong suggested that Lim knew about discounting “long before” 2020. 

“I put it to you that you are lying about when and how you found out about the two discounting applications that had been made to HSBC,” DPP Ong said. Lim disagreed.

DPP Ong then suggested that Lim was “making up” evidence that his former personal assistant Serene Seng, whose last position at Hin Leong was manager of corporate affairs, approached him to do more trades when Hin Leong’s cashflows were low.

“I put it to you that you are trying to pretend that you had no involvement in dealing with Hin Leong’s low cash situations when they occurred,” said DPP Ong, to which Lim disagreed.

In April, the Singapore State Court heard Seng confess to lying during investigations by Commercial Affairs Department (CAD), when she said she was unable to recall events connected to a transaction that is related to Lim Oon Kuin’s criminal charges.

The 61-year-old who had worked at Hin Leong Trading for close to 30 years and whose last position was Manager of Corporate Affairs, testified against her former boss, Lim.

More than 100 other charges against Lim have been put on hold while this trial is in progress.

The 81-year-old went on trial when prosecution proceeded on three charges out of the total of 130 charges: Two counts of cheating the Hongkong and Shanghai Banking Corporation (HSBC) and one count of instigating a contracts executive of Hin Leong Trading to forge a false record.

The 130 charges were for the offences of cheating, abetment of forgery of a valuable security, and abetment of forgery. 

The three charges relate to HSBC previously alleging Lim had falsified documents in order to obtain credit from the bank. In October, HSBC filed for legal action against the Lim family and a Hin Leong employee to recover USD 85.3 million of its USD 111.7 million exposure to Hin Leong.

In its filing, HSBC alleged that it was “fraudulently deceived” into lending USD 111.7 million by signing off a forged invoice for cargo sold to China Aviation Oil (CAO) for USD 56 million, the other for cargo sold to Unipec Singapore for USD 55.7 million.

An extensive coverage by Singapore bunkering publication Manifold Times regarding the fall of Hin Leong can be found below:

Related: Singapore: Hin Leong Trading Founder testifies for the first time in his own defence
Related: Singapore: Hin Leong Trading Founder to testify in USD 111.7 mil cheating, forgery case
Related: Singapore: O.K. Lim, children faces liquidators and HSBC in USD 3.5 bil civil lawsuit
Related: Former PA to Hin Leong Trading Founder found lying in CAD investigations
Related: Singapore: Hin Leong Trading Founder goes to trial for cheating, forgery charges
Related: Hin Leong Trading Founder faces additional 105 cheating, forgery charges in court
Related: Ocean Tankers judicial managers progressing to liquidate firm after expiry of court order
Related: Singapore: Hin Leong Trading Director charged with obstructing course of justice
Related: Court of Appeal: Hin Leong, Lim family claim ‘without any factual or legal basis’
Related: Singapore: High Court dismisses UniCredit Bank USD 37 million claim against Glencore over Hin Leong transaction
Related: Singapore: Hin Leong takes Deloitte to court over alleged auditing failures
Related: Hin Leong Trading Founder OK Lim facing 23 new forgery-related charges at State Courts
Related: Application to wind up Hin Leong Trading subsidiary, Hin Leong Marine approved
Related: Singapore High Court approves Hin Leong Trading wind up order application
Related: Hin Leong Trading liquidates a third of its fleet to recover USD 3.5 billion debt
Related: Lim family aims to wind up Hin Leong Trading subsidiary, Hin Leong Marine
Related: Judicial Managers of Hin Leong Trading Pte Ltd file for winding up order
Related: Hin Leong judicial managers to hold meeting of creditors to discuss fees incurred
Related: Lim family files application to wind up Hin Leong Trading subsidiary, Hin Leong Marine
Related: First creditors meeting of Ocean Tankers to be held in early January 2021
Related: Bank of China takes legal action against BP Plc and Lim family to recover $312.9 million
Related: OBS to wind up operations; creditor list alleges estimated USD 42 million debt
Related: Ocean Tankers publishes notice for creditors to prove any debts or claims for publication
Related: Hin Leong Trading founder denies allegations of forgery put forward by HSBC
Related: Singapore: Xihe Holdings and subsidiaries to be placed under judicial management
Related: HSBC takes Lim family and Hin Leong employee to court to recover USD 85.3 million
Related: Da An Shipping Pte Ltd passes winding-up resolution and publishes notice to creditors
Related: Xihe Capital and subsidiaries, Nan Guang Maritime to undergo voluntary liquidation
Related: MPA: Ocean Bunkering Services licenses suspended ‘until further notice’ and not revoked
Related: Ocean Bunkering Services bunker claims against ASL Marine & Offshore heads to arbitration
Related: Ocean Tankers to return most ships to owners to reduce $540,000 a day cash burn
Related: Singapore: Ocean Bunkering Services license suspended until further notice
Related: PwC publishes ‘investment opportunity’ for Singapore independent bunker fuel supplier
Related: Hin Leong founder O.K. Lim hit with second charge of abatement in forgery
Related: Hin Leong judicial managers and legal firms could rack up SGD 17.3 million in fees
Related: Winson Group wins ICC backing in dispute against banks over credit for Hin Leong Trading
Related: O.K. Lim and two children sued for USD 3.5billion; receiver appointed for 3 Xihe ships
Related: Managers of Ocean Tankers looking to recover USD 19 million from Lim family
Related: Argus Media: Singapore’s Hin Leong founder charged with forgery
Related: Xihe Holdings placed under IJM as OCBC reverses decision for ‘consensual restructuring’
Related: Xihe replaces Directors, forms new management team to chart fresh course for Group
Related: Hin Leong Trading lawyers publish application to fulfill requirements for hearing to proceed
Related: Ocean Tankers legal team publishes application to be placed under judicial management
Related: Judicial management applications for Hin Leong Trading and Ocean Tankers delayed
Related: Lim family to inhibit law firm Rajah & Tann from representing troubled HLT & OTPL
Related: OCBC files for Xihe Holdings to be placed under judicial management
Related: Judicial managers of Ocean Tankers discover discrepancies and fraud in exposure claims
Related: Judicial managers of Ocean Tankers to present restructuring proposals to owners
Related: PwC probes uncover mass grave of financial skeletons and alleged fraud within HLT
Related: Winson Group seeks SGD 30.4 million from Standard Chartered over HLT related trade
Related: Winson Group seeks SGD 30.4 million from OCBC over credit pull in Hin Leong trade
Related: Ocean Tankers: Notice to prove debt or claim published by interim judicial managers
Related: ‘Reasonable prospects’ to keep Ocean Tankers as a going concern, states Director
Related: Singapore: Ocean Tankers, a separate entity of Hin Leong, seeking judicial management
Related: Singapore High Court concedes interim judicial management to Hin Leong Trading
Related: Sembcorp commences legal proceedings against Hin Leong Trading over gasoil cargo
Related: Sembcorp Cogen aborts gasoil supply and storage contract with Hin Leong Trading
Related: Report: Sinopec expresses interest in Hin Leong Trading stake of Universal Terminal
Related: Report: Hin Leong Trading appoints PwC as interim judicial manager
Related: Singapore’s Police Force commence investigations into Hin Leong Trading
Related: Report: Hin Leong Trading founder gave instructions to hide USD 800 million losses
Related: Singapore: Ocean Bunkering Services to discontinue marine fuel deliveries
Related: Hin Leong in debt restructuring exercise; Ocean Tankers a separate entity, says CEO
Related: Report: Hin Leong Trading finances under scrutiny, amid credit pull from two banks

Photo credit: Manifold Times
Published: 22 November, 2023

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Vessel Arrest

Vietnam: Fishing vessel TH-92237-TS arrested over 80,000 litres of illegal diesel oil

Ship first spotted being surround by several other wooden hull fishing boats at a location about 100 nautical miles southeast of Con Da on 7 June.

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Kiem tra huong tien

The Vietnam Coast Guard on Saturday (8 June) said it arrested fishing vessel TH-92237-TS over the carriage of about 80,000 litres of illegal diesel oil.

It first spotted the vessel being surround by several other wooden hull fishing boats at a location about 100 nautical miles southeast of Con Da on 7 June.

The authority proceeded to inspect the vessel and found it to be transporting about 80,000 litres of diesel oil with no invoices or documents proving its legal origin.

Following, the coast guard conducted a record of administrative violations, established initial records, and sealed the violating goods.

It escorted the fishing vessel back to the port of Squadron 301 (in Vung Tau City) and handed it over to the Command of Coast Guard Region 3 for further investigation and handling in accordance with the provisions of law.

 

Photo credit: Vietnam Coast Guard
Published: 13 June 2024

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Alternative Fuels

IUMI: How can liability and compensation regimes adapt to alternative bunker fuels and cargoes?

Existing international liability and compensation regimes do not fully cater to the changes that the use of alternative marine fuels will bring.

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Dangerous cargo

By Tim Howse, Member of the IUMI Legal & Liability Committee and Vice President, Head of Industry Liaison, Gard (UK) Limited

The world economy is transitioning, with industries across the board seeking to reduce their carbon footprint and embrace more sustainable practices. As part of this, there is a huge effort within our industry to look to decarbonise, using alternative fuels such as biofuel, LNG, LPG, ammonia, methanol, and hydrogen.

Until now there has been much focus on carbon emissions and operational risks associated with the use of alternative fuels. This includes increased explosivity, flammability, and corrosivity. An ammonia leak causing an explosion in port could result in personal injuries, not to mention property damage, air, and sea pollution. In addition, alternative fuels may not be compatible with existing onboard systems, increasing the risk of breakdowns and fuel loss resulting in pollution. Apart from these safety concerns, which particularly concern crew, air pollution and other environmental impacts need to be addressed.

However, the green transition also presents us with a separate regulatory challenge, which has received less attention so far. So, whilst carbon emissions and safety concerns are rightly on top of the agenda now, the industry also needs to prioritise the potential barriers in the legal and regulatory frameworks which will come sharply into focus if there is an accident.

If anything, historic maritime disasters like the Torrey Canyon spill in 1967, have taught us that we should look at liability and compensation regimes early and with a degree of realism to ensure society is not caught off-guard. With our combined experience, this is perhaps where the insurance industry can really contribute to the transition.

Currently, existing international liability and compensation regimes do not fully cater to the changes that the use of alternative fuels will bring. For example, an ammonia fuel spill would not fall under the International Convention on Civil Liability for Bunker Oil Pollution Damage (Bunkers Convention), potentially resulting in a non-uniform approach to jurisdiction and liability. Similarly, an ammonia cargo incident would not fall under the International Convention on Civil Liability for Oil Pollution Damage (CLC). Uncertainties may also exist in the carriage of CO2 as part of Carbon Capture and Storage (CCS) projects, which may be treated as a pollutant, with corresponding penalties or fines.

A multitude of questions will arise depending on what happens, where it happens, and the values involved, many of which may end up as barriers for would be claimants. How will such claims be regulated, will there be scope for limitation of liability, and would there be a right of direct action against the insurers? In the absence of a uniform international liability, compensation and limitation framework, shipowners, managers, charterers, individual crew, and the insurers may be at the mercy of local actions. Increased concerns about seafarer criminalisation (even where international conventions exist, ‘wrongful’ criminalisation does still occur) may emerge, creating another disincentive to go to sea.

When being carried as a cargo, the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (HNS), which is not yet in force, may resolve some of these issues for alternative fuels and CO2. However, until HNS comes into force, there will be no international uniformity to liability and compensation for the carriage of alternative fuels and CO2 as cargoes. This creates uncertainties for potential victims and their insurers, who may face increased risks and costs, due to the potential inability of existing regulations to provide protections.

The situation is even less clear in the case of bunkers. The rules for using alternative fuels as bunkers might require a separate protocol to HNS, a protocol to the Bunkers Convention, or a whole new convention specifically for alternative fuels.  Relevant considerations for the appropriate legislative vehicle include states’ preparedness to reopen the Bunkers Convention, the ability to conclude a protocol to HNS before it comes into force, and whether a multi-tier fund structure is needed for alternative fuels as bunkers (perhaps unnecessary because bunkers are usually carried in smaller quantities compared to cargoes).

Until then, what we are left with are the existing international protective funds, designed to respond at the highest levels to pollution claims resulting from an oil spill, without any similar mechanism in place to respond to a spill of alternative fuels, which are themselves so central to a green transition. Somewhat perversely, victims of accidents involving an oil spill may therefore enjoy better protections than victims of an alternative fuels spill.

In summary, while the use of alternative fuels will no doubt help to reduce the industry's carbon footprint, there are safety and practical hurdles to overcome. Stakeholders must also come together to find solutions to complex - and urgent, in relative terms - legal and regulatory challenges.

 

Photo credit: Manifold Times
Source:  International Union of Marine Insurance
Published: 13 June 2024

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Legal

Malaysia: MMEA detains Singapore tugboat, barge for illegal anchoring in Johor

Inspection found that both vessels from Singapore were suspected of committing offences for failing to report their arrival and anchoring without permission from Malaysian Marine Department Director.

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Malaysia: MMEA detains Singapore tugboat, barge for illegal anchoring in Johor

The Malaysian Maritime Enforcement Agency (MMEA) on Tuesday (11 June) detained a Singapore-registered tugboat with a barge at approximately 3.5 nautical miles west of Pulau Harimau in Johor.

Mersing Zone MMEA director Maritime Commander Suhaizan Saadin said the tugboat and barge were apprehended at 11.00am by a MMEA patrol team during Ops Jaksa and Ops Tiris. 

“Inspection found that both vessels from Singapore were suspected of committing offences for failing to report their arrival and anchoring without permission from the Director of the Malaysian Marine Department,” he said. 

Investigation also revealed all seven crew members from both vessels were Indonesians, aged between 25 and 44 including the captain.

The detained vessels and crew were taken to Mersing Maritime Jetty to be handed over to MMEA investigators for investigation under the Merchant Shipping Ordinance 1952.

“MMEA will not compromise on any activities that are against the law and will always be committed in continuing operations and patrols along Malaysian Maritime Zone (ZMM) to curb illegal activities in the country's waters,” said Suhaizan.

 

Photo credit: Malaysian Maritime Enforcement Agency
Published: 12 June 2024

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