'Strong' Deterrent

There was no doubt in anyone’s mind that the verdict was meant to prove that Singapore will not tolerate people using the local banking system for money laundering. I am of course talking about the case of Singapore private banker, Yak Yew Chee, who was jailed on fraud charges relating to Malaysia's 1MDB financial scandal on Friday.

Allegations that huge sums were misappropriated from the Malaysian state fund through money-laundering have triggered a massive corruption scandal which Malaysian Prime Minister Najib Razak seems to have survived. However Yak Yew Chee, a former managing director at the Singapore branch of Swiss bank BSI, was not so lucky as he became the first figure to be convicted in the international saga. Mr. Yak pleaded guilty to four charges of forgery and failure to report suspicious transactions related to the investment fund and was sentenced to 18 weeks in jail by the court. He was also fined $24,000.

The crime involved transactions that include a transfer of $110 million that went through six banks and nine accounts before landing up at the Swiss bank account of Selune Ltd. Yak was paid a bonus of $7.5 million for his part of the deal.

Wait, what? He was paid over $7 million for a crime that was over $110 million, and his punishment was 18 weeks in jail with a fine of $24,000? I know this is white collar crime and the $7.5 million he got was given to the Singapore government but come on!

Like I said earlier, there was no doubt in anyone’s mind that the verdict was meant to prove that Singapore will not tolerate people using the local banking system for money laundering. However I’m afraid the fine and punishment involved is not going to deter anyone.  $24,000 for a crime that was over $110 million? That's really going to deter people.