10 months’ jail for unlicensed accountant who audited financial statements for 8 years

SINGAPORE - An unlicensed public accountant was jailed for 10 months after admitting he had audited financial statements and even forged the signature of a public accounting firm.

Robson Paul Douglas, 56, was previously a certified public accountant, but did not renew his licence when it lapsed on Jan 1, 2009.

Instead, he continued to audit financial statements for a pawnbroker, Chong Lee Pawnshop, for the next eight years.

Douglas pleaded guilty on Monday to four counts of cheating and one count of forgery for the purpose of cheating, with three other charges taken into consideration for sentencing. In Singapore, only licensed public accountants can provide an audit opinion on financial statements.

Court documents said Douglas, through his company Revelation Associates, had been engaged by Chong Lee Pawnshop to prepare its audited financial statements from 2005 onwards.

Deputy Public Prosecutor Yeo Zhen Xiong said Douglas did not renew his licence due to various family and personal issues, and realised it only when the grace period for renewal had lapsed.

But Douglas continued to take on his old client and prepared the pawnshop’s audited financial statements between 2010 and 2017.

He received $3,000 for every audited financial statement.

Moreover, two of the financial reports prepared by Douglas in 2016 and 2017 were purportedly signed by public accounting firm B.K. Liu & Co.

However, investigations revealed that Douglas had forged these signatures. He had previously worked for B.K. Liu & Co on a freelance basis, but the firm did not know of, nor did it consent to, Douglas’ acts of forgery.

On Dec 12, 2018, the managing director of Chong Lee Pawnshop filed a police report, alleging that Douglas had failed to submit its audited financial report for the financial year ending 2017.

Said DPP Yeo: “The victim also informed the police that the accused had taken the victim’s company documents for the year 2017 and the victim was thus unable to engage another firm to perform an audit.”

Investigations revealed that not only was Douglas working without a licence, but his company Revelation Associates’ status had also been cancelled as at Jan 3, 2008. The company’s status as a public accounting firm had also been removed as at March 13, 2009.

Through the years, the financial reports that Douglas audited while unlicensed were submitted to the Inland Revenue Authority of Singapore. The authority had relied on the reports and taxed the pawnbroker accordingly.

The reports were also submitted to the Registry of Pawnbrokers under the Ministry of Law for the pawnbroker to extend its licence. The pawnbroker was later investigated, but the ministry ultimately took no further action.

Douglas has agreed to pay Chong Lee Pawnshop $30,000. He has already paid $17,000 and will be paying the rest via monthly instalments.

Calling for Douglas to be jailed for between 10 and 13 months, DPP Yeo said his actions had affected the public perception and integrity of the accounting profession.

His forgery offence was an additional act of deception and had unnecessarily implicated an innocent third party, said DPP Yeo.

Douglas, who did not engage a lawyer, will start his jail term on Oct 12.