SINGAPORE — Mr Lee Hsien Yang (LHY) has said that it is impossible to fathom the decision by the Corrupt Practices Investigation Bureau (CPIB) to issue stern warnings to six former senior management staff members of Keppel Offshore & Marine Limited (KOM) over a multi-million dollar bribery case due to insufficient evidence after spending five years investigating them.

The former Singtel CEO and former Chairman of the Civil Aviation Authority of Singapore (CAAS) said this in a commentary published on The FCPA Blog, a publication which covers enforcement actions under the Foreign Corrupt Practices Act (FCPA) of the United States, in the context of an open admission of the bribery and the extensive evidence already publicly available over one of the largest corruption scandals in Singapore’s history.

CPIB, a government agency that reports to Prime Minister Lee Hsien Loong, cited evidential difficulties as the basis for not pursuing a corruption prosecution under the Prevention of Corruption Act (PCA). This explanation was repeated by Ms Indranee Rajah, Minister at the Prime Minister’s Office, on 6 February in Parliament, in response to a barrage of Parliamentary Questions filed by Members of Parliament over the non-prosecution decision by CPIB and the Attorney-General’s Chambers.

According to the US Department of Justice (DoJ), KOM paid US$55 million in bribes in Brazil from 2001 to 2014 to secure contracts with Brazilian oil giant Petrobras, which earned KOM and related entities US$351.8 million. Keppel entered into a deferred prosecution agreement with DoJ, admitting to the corrupt acts and agreeing to pay US$422 million in penalties. In Singapore, Keppel was let off with a conditional warning.

LHY noted in his commentary that KOM, which is closely linked to the Singapore government, has been involved repeatedly in corruption scandals in Singapore and overseas over many years. “The largest scandal involved the payment of $55 million in bribes. Nonetheless, Singapore has decided not to prosecute or hold those involved to account.”

KOM is a wholly-owned subsidiary of Keppel Corporation (Keppel), which in turn has Temasek Holdings as a significant shareholder. Ho Ching, the spouse of PM Lee, was Temasek’s Chief Executive Officer from 2004 to 2021— overlapping the period in which the acts of corruption were said to have been performed. Dr Lee Boon Yang, the former Chairman of Keppel from 2009 to 2021, was a former senior Singapore cabinet minister.

LHY, who has served as an independent director on ANZ Bank in Australia and Rolls Royce Holdings PLC, pointed out that corrupt acts by companies need actions and decisions of individuals at the company.

“Six very senior and well-connected individuals at Keppel, including Singapore’s former ambassador to Brazil, have been named in the international media.”

“The stance that continues to be reiterated, including in Parliament, is insufficiency of evidence, notwithstanding that extensive and comprehensive public admissions were already made to U.S. authorities that the company and persons are in Singapore, and the authorities in Singapore have access to wide-ranging powers and sophisticated digital forensic tools,” wrote LHY who expressed his dismay over the continued attempts by Singapore government ministers to defend the failure to prosecute in the face of huge public outcry.

He pointed out that Keppel had a prior corruption case in 1997, which involved S$8.5 million of bribes, which was settled with a S$300,000 fine and added, “Some of the individuals involved continued to work at Keppel and were implicated again in the Brazil corruption. Since news of the Petrobras case broke, three other cases involving Keppel have been reported. This is not a few rogue individuals. It is a deep-seated systemic problem.”

LHY wrote, “Singapore has long espoused zero tolerance for corruption. It has prosecuted and jailed individuals for derisory amounts, including a forklift operator, for bribes of S$1 ($0.74). Singapore’s corruption laws extend internationally, and Singapore has also prosecuted Singapore parties involved in overseas corruption.”

LHY is also the son of the late Lee Kuan Yew, the founding Prime Minister of Singapore and co-founder of the People’s Action Party (PAP) and younger brother to PM Lee.

Under his father, CPIB enforced the PCA impartially and investigated five PAP leaders for corruption offences from 1966 to 2016. The most senior PAP leader was Teh Cheang Wan, a former Minister for National Development, who was investigated by the CPIB in November 1986 for accepting bribes of S$1 million from two property developers. The CPIB completed its investigations on 10 December 1986, but then he committed suicide on 14 December before he could be charged in court

“This failure to prosecute, when the facts are admitted and glaring, calls into question Singapore’s commitment to its avowed zero tolerance to corruption. Speculation as to reasons for not naming and prosecuting any individuals and what other undisclosed considerations might have been involved is inevitable. That Cabinet Ministers have spoken up to defend the decision not to disclose or prosecute is deeply troubling.”

In conclusion, LHY wrote, “The failure to prosecute does more damage to Singapore and its reputation than the corrupt acts perpetrated by a Singapore government-linked company.”

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