SINGAPORE – A Singaporean man was involved in the purchase of three houses in East Coast Road worth more than $6 million in total, with a Chinese national providing the money for their purchase, a district court heard.

None of the three landed properties was a “non-restricted residential property” so foreigners are normally not entitled to buy them.

On March 5, Tan Hui Meng, 57, was sentenced to jail for two years, three months and three weeks. The undischarged bankrupt and shareholder of a local firm, Hwampoa, was also fined $3,000.

After a trial, District Judge Jasvender Kaur convicted him of eight charges in January, including three under the Residential Property Act.

According to court documents, Chinese national Zhan Guotuan, 59, had paid for the three properties – identified in court documents as J1, P1 and M1. The Singapore permanent resident’s case is pending.

The prosecution told the court the plan was for Zhan to buy all the houses along a certain row in East Coast Road and redevelop them into a condominium.

They added that Tan was Zhan’s associate in the latter’s property redevelopment business.

According to Tan, the estimated profit from the land redevelopment in East Coast Road was over $50 million, and he was to get 20 per cent of the profits from two of Zhan’s firms, court documents said.

In their closing submissions, deputy public prosecutors Suhas Malhotra and Louis Ngia said Zhan was a wealthy businessman who had shares in about 100 organisations in China.

He also had businesses in the steel industry in Indonesia, Laos and Thailand. At the time of the offences, his annual income was around $7 million.

Zhan became a Singapore permanent resident around 2003 or 2004 through the Economic Development Board’s global investor programme, under which he and his two brothers committed around $1.5 million as investment in Singapore, the court heard.

The DPPs told Judge Kaur: “(Zhan) was in the business of property development in Singapore. The business plan was simple: (Zhan), through his companies, would buy landed properties in Singapore, demolish the houses, develop small-scale condominiums on the land and sell the units.”

They added that P1 was worth $2.3 million and Tan paid a 10 per cent deposit of $230,000 for it on Jan 30, 2007.

The court heard that the money for the deposit was from a cheque for $170,000 issued by one of Zhan’s firms, Alphaland International.

A cashier’s order for $800,000 was also delivered to the seller’s law firm, with the money coming from one of Zhan’s companies, Xin An Technology Group.

A housing loan of nearly $1.3 million for P1 was taken in Tan’s name from a bank, said the DPPs, adding that the property was transferred to him in May 2007.

According to court documents, J1 was bought for $1.55 million in the name of Guan Aimei, the wife of one of Alphaland’s employees.

The DPPs told Judge Kaur that Guan had followed Tan’s instructions and signed the necessary purchase documents, including one involving a mortgage loan from a bank.

J1’s legal title was transferred to her on July 2, 2007.

The prosecutors said that Tan, Guan’s husband and another manager of one of Zhan’s firms agreed to set up Hwampoa for the purpose of holding the East Coast Road properties.

Tan incorporated the company on July 23, 2007, with a paid-up share capital of two $1 shares, each owned by him and Guan, court documents stated.

M1 was sold to Hwampoa for $2.4 million on Jan 9, 2008.

The prosecutors told the court: “The money to buy M1 was largely paid from bank loans, all of which were later redeemed using Alphaland’s monies.”

The DPPs said these houses were then “sold” to Zhan’s son and nephew, with Tan arranging the transactions. Court documents did not give the nationality of Zhan’s son and nephew.

However, the prosecution said Zhan had paid for the houses and they were “returned” to him.

Guan was fined $5,000 earlier.

In their sentencing submissions, DPPs Ngia and Foo Shi Hao urged the court to sentence Tan to a fine and up to four years and six months’ jail.

Stressing that Tan had repeatedly infringed Singapore’s land policy, they added: “His aim was to eventually buy up all seven properties along East Coast Road on behalf of (Zhan) for redevelopment into a condominium.”

Tan will be appealing against his conviction and sentence. His bail was set at $60,000 on March 5.