Man gets 33 months' jail and $400,000 fine for illegal moneylending

SINGAPORE - A man who carried on an unlicensed moneylending business for two years - charging an interest rate of up to 28 per cent - was sentenced to 33 months' jail and fined $400,000 on Monday (Dec 11).

Low Buay Huat, 52, now a warehouse assistant, who faced a total of 38 charges, pleaded guilty to 10 charges under the Moneylenders Act, and one count of failing to submit to the Official Receiver a statement of affairs of HTR Technologies while he was a director of the company.

Deputy Public Prosecutor Jaime Pang said investigation showed that sometime in early 2015, Low and a co-accused, Seah Han Leng, 45, were drinking at Orchard Towers when a friend known as Mark told them that he knew a lot of pimps and taxi drivers operating near the Orchard Road building who were always in need of money.

Mark asked if they were interested in giving out loans to them.

After some discussion, both Low and Seah entered into a partnership to issue loans to these people.

Both raised $10,000 each as operating capital for their unlicensed moneylending business. They agreed on a 50/50 per cent partnership on the loans issued and the repayments collected.

They agreed to charge a daily interest of $10 or weekly interest of $70 for a $1,000 loan until the debtor was able to settle in full the principal amount.

Mark began to introduce the pimps and taxi drivers seeking loans to the two men. Soon the duo managed to build up their customer base. They would hang around Orchard Towers every night to carry out their illegal activities.

In early 2016, a friend known as Wan invited them to invest in a construction business.

Through the investment, the pair came to know some contractors or sub-contractors who were in need of money due to cash flow issues. Both men loaned money to these contractors, and charged an interest rate of 28 per cent each month. The debtors had to make a weekly repayment.

Debtors who took further loans from them could ask for a lower interest rate.

An agreement would also be signed with individual debtors which described the loan as a "friendly" one to disguise their illegal business.

DPP Pang said Low was actively running the illegal business from 2015 until his arrest on Jan 17, 2017. At the time of his arrest, he had increased his capital contribution to $70,000, out of which $30,000 was used for loans issued to pimps and cabbies at Orchard Towers and $40,000 to contractors.

The total amount of loans disbursed to 21 people was $177,500 with the monthly interest rate ranging from 20 to 28 per cent.

Low's lawyer Ng Lip Chih successfully applied for his client to start his sentence on Jan 15.

Seah's case is pending.