29 years' jail for one of masterminds of $128m oil heist from Shell Bukom

Juandi Pungot leaving the State Courts last year. He began embezzling the marine fuel from his former employer in 2007. PHOTO: ST FILE

SINGAPORE - One of the masterminds of a massive conspiracy to misappropriate gas oil from Shell Eastern Petroleum's Pulau Bukom facility was on Thursday (March 31) sentenced to 29 years' jail, one of the longest prison terms for a commercial crime.

Juandi Pungot, 45, who began embezzling the marine fuel from his former employer in 2007, in February admitted to misappropriating 203,403 tonnes of gas oil worth $128 million.

In sentencing him on Thursday, High Court judge Hoo Sheau Peng said the offences hit at the heart of the bunkering and petrochemical industry, which is a pillar of Singapore's economy.

"The massive scale of offending is unprecedented. The length of offending is substantial. A sophisticated syndicate was involved. Foreign buyers were involved," she said.

Juandi is the first of three key players to be dealt with for his role in the conspiracy, which went on between 2007 and 2018, to illegally transfer gas oil out of the facility onto various vessels.

The Pulau Bukom site is Shell's largest petrochemical production and export centre in the Asia-Pacific region.

"The offences were premeditated, planned and sophisticated in nature. Exploiting their in-depth knowledge of Shell's systems, the accused and the co-conspirators were able to conceal their offending for a prolonged period of time," Justice Hoo noted.

The steps included configuring the flow of gas oil to avoid routes with custody transfer meters. This demonstrated a deviousness in evading detection, said the judge.

"Their efforts to cover their tracks clearly paid off as Shell had to invest a significant amount of effort to uncover the unexplained oil losses," she added.

In February, Juandi pleaded guilty to 20 charges of criminal breach of trust.

These charges involved eight co-conspirators, his colleagues at the time, who have been charged.

They are shore loading officers Muzaffar Ali Khan, Koh Choon Wei and Tiah Kok Hwee; process technicians Cai Zhizhong, Muhammad Ashraf Hamzah, Muhamad Farhan Mohamed Rashid and Sadagopan Premnat; and blending specialist Quek Rong Hong.

Three have been convicted for their respective roles. Ashraf was sentenced to 9½ years' jail, Sadagopan was sentenced to six years and eight months' jail, while Farhan is awaiting sentencing.

Others who have also pleaded guilty include Nguyen Duc Quang, Doan Xuan Than, Dang Van Hanh and Pham Van Ban, who were captains or crew members from foreign vessels.

Juandi also pleaded guilty to six corruption charges for bribing six independent surveyors to turn a blind eye to the misappropriation, and 10 charges for laundering his ill-gotten gains.

Another 49 similar charges were taken into consideration during sentencing.

Juandi obtained at least $5.6 million in criminal proceeds, which he spent on designer watches, cars, including a Mercedes-Benz GLC 250, a unit at Regentville condominium in Hougang, and properties in Bangkok and Batam.

He also went gambling with his ill-gotten gains, converting more than $550,000 into casino chips at Marina Bay Sands on 175 occasions between 2012 and 2016.

He and his co-conspirators invested in a restaurant called The 3 Amigoes in Singapore and a restaurant in Johor Baru.

Juandi first became involved in the misappropriation of gas oil in 2007, along with his colleague Abdul Latif Ibrahim.

Latif has been charged with other individuals arising out of the broader investigation into the embezzled oil.

More co-conspirators were recruited and the criminal enterprise was expanded to involve more bunker ships.

Muzaffar, the alleged third key player, was recruited sometime between end 2007 and early 2008.

Muzaffar Ali Khan was recruited sometime between end 2007 and early 2008. PHOTO: ST FILE

Generally, to broker a deal to sell misappropriated gas oil, a shore loading officer of the syndicate engaged with the captain of a vessel to discuss the sale and purchase of the gas oil.

The misappropriated gas oil was sold at a price lower than its prevailing market value.

The proceeds were split among all co-conspirators even if they were not present during the illegal loading.

Subsequently, there was a falling-out after it was discovered that Latif had kept about half the proceeds before splitting the remainder with the others.

After Latif left the group, they took a hiatus but resumed their illicit activities in 2014.

The group established contacts with vessels willing to participate in the illegal loadings and roped in three more colleagues.

The syndicate used various methods to evade detection for years, leveraging their combined knowledge of Shell's internal systems.

They configured the flow of misappropriated gas oil through carefully planned routes in the piping system and also ensured multiple pumps and tanks were moving at the same time to mask the misappropriation.

The bunker meter and the orientation of surveillance cameras were tampered with, and they coordinated their activities in group chats that were subsequently deleted.

They also paid off surveyors to cover up the unauthorised transfers.

In early 2015, Shell began observing significant unidentified oil loss at Pulau Bukom.

It first engaged a group of experts from its other offices to conduct a technical and process review, which failed to detect the misappropriation.

In 2017, Shell engaged a global management consultancy to conduct a five-week review. This investigation, too, did not provide a conclusive explanation for the losses.

Shell then engaged a global multidisciplinary team of Shell analysts to monitor tank movements. It was this team which detected the unauthorised transfer of gas oil to vessels.

Shell made a police report on Aug 1, 2017.

Juandi tendered his resignation on Dec 5, 2017, after he heard rumours of a police investigation.

However, he continued to be involved in the collection and distribution of proceeds from the misappropriation of gas oil.

Juandi was arrested on Jan 7, 2018, before he collected the proceeds from an illegal loading.

In sentencing him, Justice Hoo imposed seven to 10 years' jail for each CBT charge; 11 months to 20 months' jail for each money laundering charge; and eight to 24 months' jail for each corruption charge.

She ordered the sentences for three CBT charges, two money laundering charges and a corruption charge to run consecutively, making it a total of 29 years' jail.

"Although the global sentence is almost twice in length of the prescribed maximum punishment for the most serious of the offences (being the CBT offence), it is wholly proportionate to the overall criminality of the accused," she said.

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