Banks accuse Singapore commodity trader Agritrade of ‘massive’ fraud

At least 20 banks facing losses running into hundreds of millions of dollars from the collapse of Singapore-based Agritrade International Pte Ltd (AIPL) have accused the commodity trader of fraud, court documents show.

Singapore’s High Court appointed an interim judicial manager for the firm last month after rejecting its request for a debt moratorium on $1.55 billion in outstanding liabilities to dozens of creditors, including $983 million owed to secured lenders.

The banks have filed cases in Singapore’s high court to recover their money and allege fraud at AIPL, with Singapore’s United Overseas Bank (UOB) and Malaysia’s Maybank owed nearly $108 million each, documents show.

“There is strong evidence that a massive, premeditated and systematic fraud has been perpetrated by the defendants,” Dutch bank ING said in a Feb. 12 affidavit, referring to AIPL’s founder, Say Pek Ng, and his son Xinwei Ng, its chief executive.

ING has nearly $100 million in outstanding credit, followed by Japan’s MUFG Bank with about $78 million and France’s Natixis with $67 million, according to the documents.

All the banks declined to comment to Reuters regarding the cases.

Oon & Bazul LLP, representing AIPL and Xinwei Ng, Marican & Associates, which represents Say Peck Ng, and Agritrade Resources did not immediately respond to requests for comment.

AIPL is the parent company of Hong Kong-listed Agritrade Resources Ltd.

In court affidavits, Xinwei said AIPL encountered financial problems in 2018, amid a declining commodities market, and its woes were compounded after many banks halted funding.

Xinwei said AIPL hired FTI Consulting (Singapore) Pte Ltd as an independent financial adviser in January to review its financial position, among other matters.

Subsequently, it widened the scope of FTI’s activities to include investigations into creditors’ accusations of fraud.

FTI issued an interim report saying it had “uncovered significant fraudulent activities which include the provision of duplicate bills of lading to multiple financiers,” Xinwei told the court.

FTI declined to comment to Reuters on the report.

Responding to fraud allegations against AIPL, Xinwei he managed the day-to-day business of Agritrade Resources and its subsidiaries, while his father was in charge of AIPL’s trading business.

“I will fully support the IFA, police and the lawyers to fully uncover the degree of the fraud and do whatever is needed to trace and recover the monies which have been obtained from the lenders,” Xinwei said in the documents.

Xinwei said AIPL terminated the elder Ng’s employment on Feb. 1, after which the latter resigned.

Xinwei told creditors of this development at their meetings, he added.

“My father suddenly left us and flew out of Singapore on or around December 21, 2019. I understand that he went to China. I do not know if he intends to return to Singapore.”

Reuters

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.