SINGAPORE - A pre-school owner, who has been in prison for more than two weeks for flouting a court order by selling off a stake in her business, will serve five more months in jail for contempt of court.
Senior Judge Andrew Ang on Wednesday (Sept 27) imposed the additional jail term on Song Fanrong, 45, after her lawyer told the court that she was "unable to raise any funds" to return the $300,000 that she collected from the sale.
The judge had first committed Song to prison on Sept 11 to see whether she would purge her contempt by repaying the money.
Song, who ran eight kindergartens under her company Friedrich Frobel Holding, is being sued for $9.5 million by three businessman from China for alleged fraud.
The three alleged that Song, a Singapore citizen originally from China, misled them into believing that she could help them move to Singapore under a purported scheme that required them to invest at least $500,000 in a local company.
As part of the lawsuit, the trio obtained a Mareva injunction to freeze her assets pending the outcome of the suit.
Despite the injunction, she sold 2 per cent of her shares in Friedrich Frobel Holding and some of its stake in the Buttercups kindergarten chain.
The payments totalling about $300,000 were made to her bank account in China.
On Wednesday, Song's lawyer, Mr Siva Sothi, said she is unable to raise any money at all.
He revealed that, in a separate lawsuit that has concluded, Song was ordered to repay a US$300,000 loan but she was unable to do so.
Mr Sothi urged the court to impose a short jail term so that she can be released as soon as possible. He said she was closing down her business because of a lack of funds and was "required to have an orderly closing of the kindergartens".
He argued that Song sold off the shares as she was desperate to save the kindergarten business, highlighting some transactions in which money was remitted from her bank account in China to the kindergartens.
But lawyer for the plaintiffs, Mr Quek Mong Hua, argued that she was "leaving the kindergartens in the lurch". He said Song's actions have affected many innocent third parties - his clients, the people to whom she sold the shares, kindergarten staff and children whose parents have paid the fees.
He said if Song genuinely wanted to save the kindergartens, she should have told his clients and the other investors.
Mr Quek added that his clients have filed another complaint against Song, which is scheduled to be heard before another judge next month.
About a dozen representatives from the various kindergartens and investors attended the hearing. After the court session, they were seen questioning Mr Quek and expressing concerns about the future of the kindergartens.
The Frobel pre-school in Kallang is expected to cease operations at the end of this month, affecting 32 children. This follows the closure of two other pre-schools, in Sembawang and Namly Place, in late August.
Some parents said they made police reports regarding deposits that the pre-schools have allegedly failed to return.