SINGAPORE – He was one of three directors of a firm that sold gold to more than 2,000 unsuspecting customers under a “buyback” arrangement, bringing in revenues totalling more than $120 million.
Wong Kwan Sing, 50, who was part of The Gold Label (TGL), pocketed at least $598,000 for himself.
But a district court heard on Friday (Jan 14) that TGL had perpetrated a Ponzi scheme.
Deputy Public Prosecutors Edwin Soh and Grace Teo stated in court documents: “This buyback scheme guaranteed the clients a return on their initial investment to purchase the gold, in addition to high payouts.
“Behind the scenes, TGL had no investments or profit-generating business to sustain such payouts. It simply depended on the money from new gold sales to satisfy the payment obligations to its older customers.”
Over time, TGL did not have enough money to fulfil its obligations when they were due.
TGL’s payout and buyback obligations to clients later came up to some $85 million, with the company having a fraction of the amount – about $450,000 – in its bank accounts.
Wong, a Malaysian, was on Friday sentenced to two years and 10 months’ jail after he pleaded guilty to an offence under the Companies Act.
TGL was incorporated on April 28, 2009 and wound up in February 2011.
The cases involving another two of its former directors, Singaporean Iseli Rudolf James Maitland, 62, and Malaysian How Soo Feng, 47, are pending.
Wong became a director at TGL on Nov 20, 2009 before resigning on Sept 3,…