- Xie charged S$700 for a package that included nominated director services, corporate secretarial services, and a registered company address.
- If the company requires a bank account, Xie charges an additional fee of S$100 to S$150.
- Xie knew that it was very difficult for a Chinese company to open a bank account in Singapore, which is why Xiao wanted to start a company in Singapore.
Xie, who holds a master’s degree in professional accounting, founded Tox Technology in 2013, which he later renamed DD Corporate Services.
In 2019, he proposed DD to provide accounting and corporate services, provide accounting and tax services, file annual returns, as well as set up bank accounts and provide directors to foreign clients and incorporate Singaporean companies.
Pivot to Chinese Customers
Initially, DD reached out to local companies. After Xie expanded its reach to China in 2020, advertising DD’s services on a Chinese online forum, its customers are now mainly based in China.
After this, several agents from China contacted DD about its services and Xie worked with Chinese clients, including a man referred to him by the agents, Lou Yong, known as Leo.
Xie charged S$700 for a package that included nominated director services, corporate secretarial services, and a registered company address.
If the company requires a bank account, Xie charges an additional fee of S$100 to S$150.From 2020 to 2021, Xie registered himself as a director of companies he established for his Chinese clients to meet the legal requirement for a director resident in Singapore.
Xie also registered himself as the corporate secretary of those companies, while placing his clients as directors and shareholders.Xie made his clients sign an indemnity agreement stating that they would not engage in illegal activities, that he would not engage in business and that he would not be responsible for anything with the companies.
Because he knew it was important for him to verify the intent of the companies he connected with for his clients, Xie would do simple online searches to check if his clients were connected to criminal investigations.
He will check if their passports are valid. He said that he wants to get information about the businesses and activities of the companies that have to file their annual returns at the end of the financial year and apply to strike the companies if they find any illegal activities.
Xie Two companies connected in this way became vehicles for money laundering. The first company, called Wei Hui, dealt in the retail of paper bags, luggage and travel accessories. Besides Xie, Wei Hui’s director is a Chinese national named Xiao Weian. Xiao was referred to Xie by Leo, another client of Xie’s.
Xie knew that it was very difficult for a Chinese company to open a bank account in Singapore, which is why Xiao wanted to start a company in Singapore.He helped Wei Hui set up a multi-currency bank account with DBS Bank, with Xiao as an authorized signatory.
In October 2020, an American company called Armor Survival fell victim to a commercial impersonation scam and was tricked into transferring a total of US$1.5 million to Wei Hui’s bank account.This money was later transferred to Singapore.
Police reports were filed in Singapore in connection with the case, and police investigations revealed that Xiao did not enter Singapore.During the Covid-19 pandemic, video conferencing allowed for Know Your Customer processes.In May 2020, Leo asked Xie to take over the position of director and company secretary of a Singapore-incorporated company, Joy Trader, one of Leo’s clients.
Xei was told that Joy Trader, which has two foreign directors, Wang Huquan and Fan Jing, was a dormant company and that he had to file annual returns.He was paid S$460 by Leo.Between June and August 2020, the Jewish Federation of Greater Washington, an American organization, was defrauded by an email scam.
The spoofed emails asked a person posing as an investor to transfer funds to bank accounts in Hong Kong.The company was tricked into transferring US$7.5 million to accounts in Hong Kong. Of this amount, USD 3.1 million was transferred to Joy Trader’s OCBC account in Singapore and later liquidated.
A Hong Kong company called The International Medical Co was duped in a commercial email scam in July 2020 into sending about US$731,000 to a bank account, which was later transferred to Joy Trader’s account along with other amounts.
The entire amount was siphoned off through Joy Trader’s bank account. It was vacated in November 2020 and closed in May 2021
Before May 2020, Xie realized he was blacklisted by local banks. He didn’t find out why, instead he looked for others to be directors of companies he wanted to incorporate in order to get around the blacklisting of his clients.
He knew Lan Fang, a 51-year-old Chinese national and permanent resident of Singapore, whose daughter worked for him.He asked her to be a referral director for companies that had DD set up for its clients, paying S$50 per post.A company called Aurora Free Trading, set up with Lan Fong as its appointed director, was used to launder money embezzled from an Australian company called Tempo.
A police investigation into Xie’s activities revealed that Xie was a director of 980 companies in Singapore in January 2021. Of these, 831 are active and current appointments. Lan Fang was also registered as a director of around 100 companies under contract with DD.Deputy State Attorney Janice See asked for a prison sentence of four to six weeks and a minimum five-year disqualification from acting as a director.
Ms See said Xie had “turned a proverbial blind eye” and “taken no action” in overseeing the affairs of his companies.This resulted in a significant amount of illicit funds being sent through Wei Hui and Joy Trader’s bank accounts, totaling about US$5 million, Ms See said.
He said fines for certain offenses would not achieve the “necessary deterrent effect” against Xie, given the scale of his culpability in his “complete failure to exercise due diligence” and how he had “obviously” taken aggressive steps to expand his business. Red flag” and he was blacklisted from setting up bank accounts for his companies.
