More than $27 million in illicit proceeds have been seized by the authorities in Singapore, in connection with a large-scale Ponzi scheme in China.
In a statement on Tuesday (21 August), the police said the seizure resulted from Singapore’s Commercial Affairs Department (CAD) assisting Chinese authorities with its probe into Ezubao, a large-scale Ponzi scheme. The scheme involved about 1.15 million investors with an estimated loss of 38 billion yuan (S$7.59 billion).
According to financial education website Investopedia, a Ponzi scheme is a fraudulent investing scam promising high rates of return with little risk to investors. In reality, it generates returns for older investors by acquiring new investors.
In May 2016, CAD helped the Chinese authorities to trace assets in Singapore in relation to the investigation. It found that more than S$27 million in ill-gotten gains had been transferred to the Republic. The assets were seized that same month.
CAD and the Economic Crime Investigation Department (ECID) of China’s Ministry of Public Security then conducted a joint investigation on this matter in China and Singapore concurrently, with the assistance of the Chinese embassy here.
CAD investigations also established that no local entities were involved in money laundering activities in Singapore.
To date, the Beijing First Intermediate People’s Court has found 26 individuals guilty of fraud and other offences. They were sentenced to a range of three years and life in prison.
Following the sentencing of the defendants in China, CAD and ECID arranged for the seized monies to be returned to China this month. This was done to facilitate the restitution to the respective investors, in accordance with the Chinese legal framework.
More Singapore stories