What is Corruption

Written by Team Farallon

  • Farallon Law Corporation
  • June 25, 2021

Corruption is the acceptance or agreement to accept, from any person, any gratification as an inducement or reward for the conferment of a benefit. This gratification, or bribe, can be monetary or non-monetary in nature. For example:

  • Money, gifts, loans, fees, rewards, commissions or other property of any description
  • Any office, employment or contract
  • Any payment, release, discharge or liquidation of any loan, obligation or other liability
  • Any other service, favour or advantage of any description (including sexual favours)
  • Any offer, undertaking or promise of any gratification

The Prevention of Corruption Act (“PCA”) is the primary anti-corruption law in Singapore. Other key anti-bribery and anti-corruption laws can be found in the Corruption, Drug Trafficking and other Serious Offences (Confiscation of Benefits) Act and Chapter IX of the Penal Code.

The Corrupt Practices Investigation Bureau (“CPIB”) is empowered under the PCA to investigate and enforce corruption-related offences. Under s 37 of the PCA, the CPIB has extra-territorial powers to deal with corrupt acts committed by a Singapore citizen outside Singapore, as though these acts were committed in Singapore.

Punishment for Corruption

Section 5 of the PCA, which contains the general prohibition against corruption, makes it an offence to give and receive bribes. Similarly, Section 6 of the PCA, which prohibits corrupt transitions with agents, makes it an offence for an agent to give and receive bribes in relation to his/her principal’s affairs. The punishment for either offence is a fine not exceeding $100,000 or imprisonment for a term not exceeding five years or to both.

Additionally, Section 7 of the PCA provides that the penalty may be increased where the matter in relation to which the offence was committed was a contract or a proposal for a contract with the government or any department thereof or with any public body or a subcontract to execute any work contained in such a contract. In such situations, the prescribed penalty is a fine not exceeding SGD100,000, or imprisonment for a term not exceeding seven years, or both.

Business Expenditure and Courtesies

The CPIB acknowledges that gifts and entertainment are often offered in the “legitimate course of business” to promote good relations. This is provided that such courtesies are not too frequent or lavish, or done with the deliberate intention to gain an unfair business advantage. In general, modest gifts and meals which are extended for the purpose to create good will not contravene the PCA as long as there is a justifiable business purpose. It is advisable for companies to keep accurate proper records and accounts of such transactions.

Case Highlights Involving Corruption

Keppel Corporation

In 2017, Keppel Offshore & Marine, a subsidiary of Keppel Corporation, was investigated for having paid over USD55 million in bribes between 2001 and 2014 to officials in Brazil in exchange for favourable contracts. Keppel Offshore & Marine was fined USD422 million as part of a global settlement with the US Department of Justice, in conjunction with the Brazilian authorities and the CPIB.

Ang Mo Kio Town Council

Former general manager and secretary of Ang Mo Kio Town Council, Wong Chee Meng, was charged with 55 counts of corruption for receiving more than $86,000 in bribes from directors of two building and repair companies. He was sentenced to three years and three months’ jail.

Singapore Civil Defence Force

Former Singapore Civil Defence Force (SCDF) chief, Peter Lim Sin Pang, was convicted in 2013 for corruptly obtaining sexual favours from two female vendors and one potential female vendor to the SCDF as an inducement for showing favour by advancing the business interest of their companies with SCDF. He was sentenced to six months’ imprisonment, and was officially dismissed from the public service on 31 August 2013.

Private Sector Corruption

Two Japanese men were each convicted of 28 charges of corruption for obtaining bribes amounting to more than $2 million in bribes from a flour distributor of their employer. The pair devised a profit-sharing arrangement pertaining to the industrial flour business to extract bribes from one Mr Koh in return for them continuing to “support and protect” his edible flour business. They were each sentenced to three years, seven months and three weeks’ jail, as well as a fine of $200,944.

Legal Advice on Offences Related to Bribes and Corruption

Corruption has serious consequences. If you believe you may be charged with an offence for corruption or you are currently under investigation and wish to consult a lawyer, contact us now for a confidential consultation. We have acted for one of the defendants involved in the largest purely private-sector corruption in Singapore and will be able to provide you the necessary counsel and advice.

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