Embezzlers usually know the system

SINGAPORE - What are some of the common factors in the embezzlement cases here?

For one, they involve people who know the system well, said Hongkong-based corporate investigation and forensic accounting specialist Andy Cheung.

Most embezzlers know the system well enough to exploit loopholes.

The former anti-graft officer said: "Sometimes they're so familiar they know auditors are looking out for amounts above a certain threshold, say $5,000. So they take amounts less than $5,000 so the records won't stand out."

Singapore Airlines employee Teo Cheng Kiat embezzled $35 million from the company over 13 years by forging cabin crew claims, which were directed into false bank accounts he set up.

Former Asia Pacific Breweries (APB) finance manager Chia Teck Leng took loans from banks by claiming to be acting on behalf of APB and forging signatures of its directors. From 1999 to 2003, he swindled banks of $117 million.

False documents

At times, embezzlers even prepare for internal audits by falsifying documents to cover their tracks, said commercial investigation expert Kelvin Ko.

Then there are the external factors that push them to commit crime.

Chia was feeding his gambling addiction.

Teo was fuelling his lavish lifestyle, including six private apartments, a house and two luxury cars. He also had a penchant for expensive watches.

So, how then did they get caught?

Mr Cheung and Mr Ko said there are usually three ways such offences come to light: change in the system, greed or whistle-blowers.

Teo got greedy and made 10 transactions in a day, instead of the one that is allowed.

In Chia's case, it was the Commercial Affairs Department that got wind of his crimes.

Chia and Teo are serving 42 and 24 years of imprisonment respectively.

Organisations need to constantly update the way they do compliance checks, said Mr Ko.

"With advanced technology, there are many more ways for criminals to embezzle, so organisations should be proactive in their audits."


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