SINGAPORE - A former manager of BP Singapore allegedly suggested to a businessman to set up a company and then procured its appointment as an approved counterparty or supplier for the oil giant, a district court heard on Tuesday (Feb 6).
The company, Pacific Prime Trading (PPT), subsequently became the largest supplier of "delivered" sales for BP Singapore and, eventually, the sole supplier.
The prosecution said this at the start of the trial of Koh Seng Lee, 56, the sole shareholder and executive director of PPT, and Clarence Chang Peng Hong, 52, BP's former regional manager for marine fuels.
Koh, who is also a shareholder and director of Vermont UM Bunkering, is alleged to have given bribes amounting to US$3.95 million to Chang on 19 occasions via his HSBC HK Premier bank account as an inducement for advancing the business interests of PPT with BP.
The alleged offences took place between July 31, 2006, and July 26, 2010.
For "delivered'' sales, BP carries out a "back-to-back'' transaction by buying bunker fuel from the trading counterparty, and simultaneously selling the bunker fuel to BP's customer. The bunker fuel from the trading counterparty could have been previously bought from BP and/or from other sources.
Koh is facing 20 charges in total. He is also accused of corruptly agreeing to give a $500,000 bribe to Chang. The court heard that over a period of six months from Sept 17, 2009, Koh paid the $500,000 for Mindchamps Preschool @ City Square.
Koh and Chang's wife, Ms Fennie Ong Mee Fun, were directors and equal shareholders of Mindchamps, which was set up in September 2009, providing child care services for pre-school children.
Chang faces 20 mirror charges of corruptly receiving the bribes from Koh. Another 27 charges under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act have been stood down.
Chang was working for BP for 13 years, from July 7, 1997, to July 10, 2010, and his last appointment in the company was Regional Marine Manager East of the "Global Residues" unit.
In his opening statement, Deputy Public Prosecutor Jiang Ke-Yue said that Vermont UM also became an approved trading counterparty of BP in December 2009. A month later, it also became a supplier of "delivered'' sales, through trading at lower volumes than PPT.
He said the prosecution would show that apart from the suggestion that Koh set up PPT, the two men also had an understanding that Chang would "make or break" PPT's fortunes as a trading counterparty of BP.
"The case turns on the purpose of the payments, which in view of the serious conflict of interest, cry out for explanation,'' he said.
Koh is represented by Senior Counsel (SC) Chelva Rajah and Chang by SC Andre Maniam. The hearing continues before District Judge Ong Chin Rhu.