Man gets 5 months’ jail for forgery linked to tax fraud that caused Iras to pay out more than $772k

SINGAPORE – A man linked to a goods and services tax fraud scheme created 12 electronic template invoices despite knowing that they would be used for unlawful purposes.

Members of a criminal syndicate later used these templates to generate

319 forged sales invoices worth at least $88 million.

As a result, the Inland Revenue Authority of Singapore (Iras) was defrauded of more than $772,000 in total.

Tay Tiong Kiong, 45, pleaded guilty on Thursday to a forgery charge and was sentenced to five months’ jail.

He was paid $6,000 for his role in the ruse, and has since handed over the amount to the authorities.

Deputy public prosecutors Matthew Choo and Joshua Phang stated in court documents that the syndicate had incorporated a local firm called Nagore Trading.

Another man, Lee Chong Hoong, 42, who was a director at the company at the time of the offences,

was sentenced to three years’ jail in October 2022.

The cases involving several alleged accomplices – including Wong Meng Fai, 44, and Ang Chee Keong, 47 – are pending.

Nagore Trading was part of a GST missing trader fraud scheme that operated between Feb 4, 2015, and Jan 28, 2016.

The shell company with no real business operations was set up to generate false invoices to create an impression it had paid local suppliers for goods and sold them to other firms.

These buffer companies that Nagore “sold” goods to were in on the scheme. They forged invoices to other businesses involved, though there was no actual trade.

In earlier proceedings, the prosecution told the court: “At the end of the chain of buffer companies, the masterminds of the Nagore scheme would approach an exporter and sell the purported goods to them, for export overseas to a purported buyer that was arranged by the masterminds.”

The exporters then paid the buffer companies the selling price of the goods with GST included, which made up the source of the scheme’s criminal proceeds.

Not knowing the transactions were a sham, the exporters then claimed GST refunds from Iras.

In January 2016, Lee, who is also known as Kingsley, approached Tay and asked if he could help create templates for some invoices issued by electronics shops in Singapore.

Lee also promised payments of $3,000 a month to Tay, who accepted the offer.

Tay then used Microsoft Excel to create the template invoices, which he based on genuine ones from various electronic shops in Singapore that Lee had provided him for reference.

The prosecutors said that Tay had strived to ensure that the invoices looked as genuine as possible.

Among other things, Tay – on Lee’s instructions – made sure that the templates were created only for GST-registered suppliers.

Tay also created a column for GST in each template, and inserted formulas for calculating the tax.

Template invoices he created were later used to forge at least 319 sales invoices purportedly issued by 12 suppliers to Nagore, with a total stated sales value of more than $88 million.

These sales invoices were entirely false, said the prosecutors.

The ruse came to light when an Iras investigation officer alerted the police on Aug 8, 2018.

In the report, she stated that Iras had started investigations into various entities, including Nagore, for suspected offences involving GST.

She further stated that Iras’ investigations also had uncovered invoices from Nagore showing sham transactions.

Tay’s bail was set at $15,000 on Thursday, and he is expected to surrender himself at the State Courts on May 12 to begin his sentence.

For forgery, an offender can be jailed for up to four years and fined.