Over $27 million linked to Ezubao Ponzi scheme recovered in Singapore: Police

SINGAPORE - Police have recovered more than $27 million in proceeds in Singapore involving China's largest online peer-to-peer lender Ezubao, which was found to be a large-scale Ponzi scheme.

The money was returned to China this month after a Beijing court convicted 26 individuals of fraud and other offences.

The Singapore Police Force's Commercial Affairs Department (CAD) in May 2016 assisted China's Economic Crime Investigation Department (ECID) to conduct asset tracing in Singapore for their investigations into Ezubao.

The Ponzi scheme involved about 1.15 million investors with an estimated loss of 38 billion Chinese yuan (S$7.5 billion).

CAD found that more than $27 million in proceeds were transferred to Singapore and alerted the Chinese authorities, Singapore police said in a statement on Tuesday (Aug 21).

Together with the Embassy of China in Singapore, CAD and ECID then mounted a joint investigation into the case in both countries.

In May 2016, CAD found that no local entities were involved in money laundering activities in Singapore.

The 26 individuals involved in the Ponzi scheme were sentenced in a Beijing court to between three years' jail and lifetime imprisonment for their offences.

The seized monies have been returned to China to facilitate restitution to the individuals, in accordance with the Chinese legal framework, the statement said.

CAD director David Chew said that the case is a testament to the Singapore police's commitment in working with foreign counterparts to detect and deter transnational crime, as well as preserve the integrity of Singapore's financial system.

"The strong ties between the police forces of China and Singapore is instrumental in ensuring that our financial system is not abused by criminals," he said.

In April, a former director of a Singapore law firm was fined $10,000 for failing to notify the authorities that her "high net worth client" could be linked to the Ponzi scheme.

Kang Bee Leng 56, who was a managing director of Sterling Law Corporation, had carried out conveyancing work for Zhang Min, former president of Yucheng International Holdings, whose firm launched Ezubao.

At the time, Zhang was buying a house in Sentosa Cove worth $23.8 million, but she was detained by the Chinese authorities in December 2015.

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