SINGAPORE (BLOOMBERG) - The troubles facing Singapore oil trading firm Hin Leong deepen as the police have started investigating the company.
The probe, which the Singapore Police Force confirmed by e-mail, is the latest twist in the downfall of the company, which owes US$3.85 billion (S$5.49 billion) to more than 20 banks and revealed in court filings that it hid about US$800 million (S$1.14 billion) in losses. Hin Leong did not immediately respond to e-mails and a phone call seeking comment on Tuesday morning (April 21) in Singapore.
The implosion of Hin Leong Trading, one of the biggest and most secretive players in the world of physical oil trading, is among the most spectacular impacts wrought by this year's collapse in oil prices, which squeezed the firm's revenues and triggered banks to call in debts.
It is also the latest disaster to hit the commodity trading community in Singapore, among the biggest globally alongside Geneva, London and Houston. Singapore in recent years has seen the collapse of two other big names in the industry, Noble Group and Agritrade International, and a rogue oil trader racking up millions of dollars in losses.
Hin Leong, founded in 1963 by Mr Lim Oon Kuin, is seeking Singapore court protection from its lenders. In filings seen by Bloomberg, it said the company hid about US$800 million in losses incurred from futures trading over the years on the orders of founder of Mr Lim. It also sold some of the millions of barrels of fuel it had used as collateral to secure loans from its banks, according to the documents.
Separately, Singapore's Accounting and Corporate Regulatory Authority said in an e-mail on Tuesday that it is "monitoring this case and will assess if further action is warranted". Meanwhile, the Monetary Authority of Singapore, the nation's financial regulator and central bank, has been in contact with Hin Leong's bank creditors, according to people familiar with the matter, who requested anonymity as the matter is confidential.