O.K. Lim and children declared bankrupt

Hin Leong’s founder Lim Oon Kuin and his two children were declared bankrupt last week, the electronic government gazette published on Friday (Dec 27) showed.

Better known in the oil trading industry as OK Lim, the 82-year-old, his 57-year-old daughter Lim Huey Ching and 54-year-old son Lim Chee Meng will have their bankruptcy estates managed by trustees Leow Quek Shiong and Seah Roh Lin of BDO Advisory.

The bankruptcy stemmed from the former Singapore oil tycoon and his two children having agreed in September to pay US$3.5 billion (S$4.75 billion) to the court-appointed liquidators of the company and top creditor HSBC after a 50-day civil trial.

In the judgment reached by both parties, the family will have to pay US$3.5 billion plus interest from April 2020 to the date of payment, on top of costs.

But the Lims then commented that they did not have enough assets to pay all the claimants that have taken legal action against them and would be applying for bankruptcy.

While they have consented to the judgment, they are not admitting liability for the allegations against them, which included fraudulent trading and their breach of fiduciary duties as directors.

They were sued in August 2020 to force them to repay the US$3.5 billion debt and US$90 million in dividends that they allegedly paid themselves, even though their firm was insolvent.

The Lims said that they offered to consent to the judgment without admitting to liability because they did not wish to take up any more of the court’s time and resources.

Besides HSBC, other claimants that have accepted the Lims’ offer include Sembcorp Cogen and Credit Agricole.

Meanwhile, OK Lim was sentenced to 17 years and six months’ jail in November for two counts of cheating and one count of forgery in what prosecutors described as "one of the most serious cases of trade financing fraud that has ever been prosecuted in Singapore".

He was found to have duped HSBC into disbursing US$111.7 million to Hin Leong based on two fabricated oil sale contracts – of which US$85 million remains the bank’s total outstanding loss.

He also instructed a former employee to forge documents for one of the bogus contracts.

Lim is appealing against the conviction and jail term.

ALSO READ: O.K. Lim gets 17.5 years' jail for cheating and forgery

This article was first published in The Business Times. Permission required for reproduction.