Tuesday, 4 October 2016

A Post-analysis of Singapore deal: Papua New Guinea Community College Trust Scandal - Part 3

by BRYAN KRAMER

THIS is Part 3 of a possible seven (7) part series of articles providing insight into the recent decision (1/9/16) by Singapore Supreme Court to imprison/jail former Chairman of PNG Community College Trust, American, Thomas Doehrman and his Singapore wife Lim Ai Wah for upto 5 years over fraud and money laundering offences.


Part 1 - provided a brief of the Court ruling and covered some background information to answer the question what is PNG Community College Trust, why it was established and the parties involved in its dealing's.



Part 2 - provided sequence of events surrounding the payment of the secret commission of $3.6 million and the subsequent distribution of the proceeds to the benefit of various persons.

In Part 3 I will discuss the extracts from the statements submitted by Doehrman and his wife, Lim during the course of the first police interviews which the Prosecution relied during the trial to secure their conviction's.

On 15 March 2011 members of Singapore Corruption Practices Investigation Bureau (CPIB) picked up Doehrman's wife Lim for questioning in relation to the payment of $3.6 million to Questzone Offshore Ltd from ZTE Corporation.

When questioned whether any arrangements were made regarding the $3.6 million. Lim responded:

"I wish to state on a few occasions in 2010 the details of which I can not remember, myself, my husband Tom [Doehrman] and Stephen [Li Weiming] met up to discuss this issue."

"Sometime in beginning 2010 Steven Li met up with me and told me to setup a British Virgin Island (BVI) company as he wanted payments to the PNG PM as [he] had given the community college project to ZTE. He also told me his wife would be setting up a company and he will receive payments from BVI company. He told me that his bosses did not want to make any payments to Quest Petroleum and wanted a BVI company. I understand that ZTE have to pay PNG PM to get work in Papua New Guinea."

Lim went on to explain in paragraph 36 of her statement that Questzone Offshore Ltd was set up in order to receive payments from ZTE"

(Paragraphs 37-39) "Questzone Offshore was essentially a shell company set up to receive to receive $3.6 million from ZTE."

What is a shell company? It is a company without active business operations or significant assets (a paper company) "These types of companies are sometimes used illegitimately, such as to disguise business ownership from law enforcement or the public." The term shell company is representative of something that is really an empty shell.

Lim also acknowledged she was a director of Questzone Offshore Pte Ltd, a British Virgin Islands company of which she is the sole member apart from her sister, Ms Lim Swee Kheng, who is a nominal director. ( A nominal company director is a person appointed to be a director but doesn't play any active role in the company's affairs or dealings).

Now CPIB raised these issues because they were trying to establish whether or not the invoice issued by Questzone Offshore to ZTE was genuine or a fake and part of a conspiracy or scam to defraud ZTE and PNG Community College Trust - where the proceeds were later laundered (disguised to look legitimate) to the benefit of the named persons who had a direct conflict of interest in the transaction.

Following Lim's interview the next day on 16th March 2011 CPIB conducted a formal interview of Doehrman.

He acknowledged during his record of interview that:

"...[Questzone Offshore] was set up for the collection of commission for the USD$35 million project that was given to ZTE Corporation,.."

When asked what is the business activity of Questzone Offshore Ltd, he responded:

"I do not know. The company registration was done by the secretarial firm, Porticulus [sic]. From what I know Questzone Offshore Limited has no business dealings. It was set up to collect the commission and made payments out to Ai Wah, PM of PNG, Moox, and Stephen and also to hold contingency monies.."

Portcullis Trustnet is a wealth management company based in Singapore. They also setup and sell offshore companies based in British Virgin Islands which help ensure names, finances, business interests and political links remain hidden. It does this using a variety of methods, such as creating maze-like layers of companies and financial trusts in multiple countries and in many cases helping clients open overseas bank accounts in the names of anonymous companies rather than in their own names.

Doehrman went to on explain:

"During the initial stage of the [community college] project, it was estimated that the value was $3.6 million. Sometime in June or July 2010 at Shangri-La Hotel in Shenzhen (China) Stephen, Ai Wah [Lim] and I were there for a meeting. In the meeting, Stephen was the one who said set aside 10% commission. The 10% commission of the estimated project value of US$36 million was calculated to be US$3.6 million."

When asked who decided on the amount of commission to be paid? Doehrman replied,

"I wish to say that the decision was collective between me, Ai Wah, [Lim], Stephen and Moox on certain matters of contingencies" (possible future needs).

On 17th March 2011 CPIB interviewed Stephen (Li Weiming) - no details of his statement are provided.

On 18th March 2011 CPIB recalled Lim for a further interview which she confirmed Questzone had no employees or associates. The company had no concrete plans to hire any employees in the future nor did own or rent office space or even have Postal (PO Box) address. When asked if Questzone had signed any contracts with any companies she replied

"I wish to reply that no, Questzone Offshore has not signed any business contracts"

Following the interviews of Lim, Doehrman and Stephen no formal charges were made against them. Now this is an important issue as it is beyond question CPIB were of the view a crime had been committed which triggered their investigation.

The preliminary findings and initial record of interviews revealed that:

1) In early 2010 PNG Community College Trust and ZTE entered into discussions in the awarding of US$35 million frame contract to supply the community college project in PNG.

2) In May 2010 Lim setup Questzone Offshore Ltd to receive commissions from ZTE. She and her Sister were directors of the company which she setup allegedly acting on a request by Stephen Weiming

3) Questzone was a shell company without any employees, place of business or signed any contracts with any businesses.

4) In June 2010 the PNG Community College Project contract was estimated to be $36 million.

5) In July 2010 Questzone invoiced ZTE $3.6 million purportedly (allegedly) being for Contract for Equipment Supply" It was attached with a cover letter stating it was for a Contract of Service.

6) The invoice implied it was raised on the back of a sub-contract between Questzone Offshore and ZTE to provide services to ZTE in the delivery of the PNG Community College Project.

7) However Lim submitted a statement that Questzone Offshore has not signed any business contracts.

8) Following formal record of interviews Lim and Doehrman confirmed the $3.6 million was a 10% commission of contract which by June 2010 had been revised to be $36 million.

6) Days after ZTE issued payment of $3.6 million to Questzone Offshore, portions of the proceeds were paid to individuals who had a direct conflict of interest in the transaction.

So why weren't they charged? My view is that while CPIB had established a crime had been committed they needed a complainant, in that either ZTE or PNG Community College Trust to file a complaint to say they had been defrauded.

In this case both parties were involved in the transaction which included ZTE's chief representative Stephen Li Weiming seeking to secure a lucrative US$35 million (K120 million) contract on behalf of ZTE and members of PNG Community College Trust namely, Thomas Doehrman and allegedly his Deputy Michael Somare Jnr seeking to benefit from a secret commission (kick back)

On 30 August 2010 ZTE paid the $3.6 million pursuant (according) to Questzone Offshore invoice, all while the contract had yet to be awarded to ZTE by PNG Community College Trust.

The very next day on 31st August 2010 following the payment a formal contract was signed between ZTE and PNG Community College Trust valued at $38.8 million.

Now it can be argued no actual funds were defrauded from PNG Community College Trust as the $3.6 million was paid by ZTE Corporation before any contract was awarded to them.

However it begs the question whether the increase in the initial contract price from $35 million to $38.8m was to make provision (provide) for the recovery of $3.6 million secret commission initially paid by ZTE in a possible scheme to secure the contract.

If correct then ultimately PNG Community College Trust (People of PNG) was defrauded through the inflation of the contract by $3.8 million ($35 million to $38.8 million)

Now it would not be in ZTE's interest to file a complaint for fraud against one of their own employee's or the Chairman of the Trust including Somare Jnr if they had agreed to pay a secret commission to Questzone with the intent to secure the $36 million (K120 million) main contract from PNG Community College Trust.

It wasn't until a year later on 25 July 2012 in the height of the political impasse between Somare and O'neill, a period Somare had lost the office of Prime Minister, CPIB laid formal charges against Doehrman, his wife Lim and Stephen Weiming. This also raises the question whether members of O'neill Namah Government played a part in assisting CPIB investigations in an effort to undermine Somare's return in 2012 elections. I am reliably informed members of O'Neill/Namah Government made numerous trips to Singapore to make inquiries into the status of investigations by CPIB.

On 25 July 2012 Doehrman, Lim and Stephen were each charged with six offences. A single charge of conspiracy (secret plan) to falsify accounts namely fictitious (fake) invoice and sub-contract between ZTE and Questzone to procure the payment of $3.6 million. The remaining five charges of concealing and transferring benefits of criminal conduct (Money laundering) namely two payments ($750,000 and $100,000) to Stephen's wife's company in Hong Kong and three payments totalling $784,000 made into Somare's Singapore account.

Following their arrest all three were subject to further record of interview before being formally charged.

Part 4 we will discuss statements made during the record of interview by Doehrman and Lim following their arrest including their claims directly implicating Grand Chief Somare and his son Michael Somare Jnr.

We will consider whether their statements are credible or partly fabricated with the intent to avoid criminal prosecution. Lastly, we will consider the reasoning why Doehrman and Lim insisted the invoice was for a commission even though the particulars of invoice clearly stated it was for a contract of equipment.

Photo: Doehrman and Sheppard meeting with Fr./Dr. Xavier Alphonse and ZTE officials in Singapore in 2012.

Note: There are seven (7) parts to this articles: 

Part One: Singapore Supreme Court sentenced former Chairman of PNG Community College Trust American Thomas Doehrman (Doorman) and his Singapore wife Lim Ai Wah to prison for 5 years 10 months and 5 years respectively after finding them guilty of conspiring with Chinese national Li Weiming to defraud US$3.6 million (K11.6 million) from the ZTE corporation - a Chinese company that is a global supplier of information, technology and telecommunications equipment that was awarded $35 million contract by the PNG Community College Trust.
It explains what is PNG Community College????   

Part Two:  Provides insights into the decision by Singapore Supreme Court to convict (find guilty) and imprison former Chairman of PNG Community College Trust Thomas Doehrman and his Singapore wife Lim Ai Wah over fraud and money laundering offences.
Its reveals how the deal was done to award the contract.?????? 

Part Three:  A discussion on the extracts from the statements submitted by Doehrman and his wife, Lim during the course of the first police interviews which the Prosecution relied during the trial to secure their conviction's.
It shows what was actually done behind the closed doors??? 

3 comments:

  1. If you want your ex-girlfriend or ex-boyfriend to come crawling back to you on their knees (even if they're dating somebody else now) you must watch this video
    right away...

    (VIDEO) Win your ex back with TEXT messages?

    ReplyDelete
  2. eToro is the #1 forex trading platform for beginner and professional traders.

    ReplyDelete
  3. Quantum Binary Signals

    Professional trading signals delivered to your cell phone daily.

    Start following our signals today and gain up to 270% a day.

    ReplyDelete