Two accused in Keppel Club $37.5m membership scam convicted

Keppel Club's supervisor, Nah Hak Chuah (left), and a club member, Ivy Cheo Soh Chin, both 67, were convicted for their roles in a membership scam.
Keppel Club's supervisor, Nah Hak Chuah (left), and a club member, Ivy Cheo Soh Chin, both 67, were convicted for their roles in a membership scam.ST PHOTOS: WONG KWAI CHOW

1,341 people duped over 10 years; one admits to making false entries and the other to money laundering

Over a period of 10 years, a supervisor of Keppel Club's membership department duped 1,341 people into believing that they had paid for membership at the club, even issuing them with cards which allowed them use of the facilities.

In all, the buyers forked out a total of $37.5 million for club memberships from 2004 to 2014, which included transfer fees of $17 million. The amount was supposed to be paid to Keppel Club.

Yesterday, the supervisor, Nah Hak Chuah, and a club member, Ivy Cheo Soh Chin, both 67, were convicted over their roles in the membership scam.

Nah admitted to 30 of 1,280 charges of making false entry in the electronic membership database in the Club Management System (CMS), while Cheo admitted to 20 of 303 charges of money laundering.

The trial of alleged mastermind Setho Oi Lin, alias Setho Irene, 70, is scheduled to begin next Monday.

The senior executive had worked in the club for nearly 48 years, and rose through the ranks. During the material time, she was a personal assistant to the general manager, the person in charge of membership transfers, enrolments, resignations and queries.

Deputy Public Prosecutor Ian Ernst Chai said the general manager of the club lodged a police report on Aug 13, 2014, stating that both Nah and Cheo had cheated people into buying club memberships from phantom members.

Instead of paying the club, these buyers were directed to pay the purchase prices and transfer fees to third parties who included, among others, Cheo, her daughter, mother and brother-in-law, who were never members of the club. Cheo is Setho's personal friend.

After the club stopped selling new memberships in 1996, anyone who wishes to become a member has to buy the membership from an existing member at a mutually agreed price.

The purchase price would include a fixed transfer fee of $12,840 and an account activation fee ranging from $300 to $530 across the years, both to be paid to Keppel Club.

The balance of the purchase price, after deductions to Keppel Club, would go to the existing member selling the membership.

As of August 2014, the club had 2,682 legitimate members.

DPP Chai told Principal District Judge Bala Reddy that Setho allegedly started selling fake club memberships from 2004.

She would source for interested buyers on her own or inform membership agents that she had Keppel Club memberships for sale.

These agents would then source for buyers and put them in touch with Setho who knew that in fact, none of the memberships would be transferred from existing ones.

Some time between June 1 and Aug 1 in 2014, Setho instructed Nah to create new membership accounts for 1,280 buyers in the club's CMS. These buyers had been duped into buying club memberships from phantom members.

Nah knew that the new membership accounts to be created were false but still did it, thus falsifying records belonging to his employer.

He used information in the membership application forms, which contained the buyers' information and phantom sellers' names.

After the cheques or cashier's orders had been deposited, Cheo helped Setho transfer $6.1 million and kept at least $151,500 as commission payments, between Feb 23, 2010 and July 31, 2014.

The case was adjourned to Jan 10 for mitigation and sentencing.

A version of this article appeared in the print edition of The Straits Times on December 01, 2017, with the headline 'Two accused in club membership scam convicted'. Print Edition | Subscribe