In a recent decision, the Singapore High Court held that corruption is possible even if the agent discussed the idea of a reward with the third party alleged to have been favoured only after acting in relation to his principal’s affairs. The central inquiry  was  whether the  agent in this case, Tjong Mark Edward (“Tjong“),  who  was  the  former  Director  of  Business  Development  at  ST Electronics  (Info-Software  Systems)  Pte  Ltd  (“STE“),  favoured  a  third  party, Mujibur  Rahman  (“Mujibur“),  in  derogation  of  his  duties  to  STE.  Given  that Tjong  had  to  exercise  his  judgment  in  recommending  Mujibur  to  STE  and knew  that  his  recommendations  would  be  influential,  it  was  sufficient  that Tjong was coloured by the contemplation or implied understanding that some sort of reward would eventually be offered.

Facts

Tjong,  who  oversaw  STE’s  business  development  in  the  South  Asia  region, was introduced to Mujibur, the managing director of a Bangladeshi  firm that handled  government  contracts.  Following  Tjong’s  recommendation  to  STE, Mujibur  was  appointed  as  STE’s  agent  in  Bangladesh  to  help  secure  a contract with the Bangladeshi Police Department. Mujibur was successful and was paid 7% of the contract price as his fee. Mujibur later handed Tjong two signed  blank  cheques  in  Dhaka.  Tjong  filled  in  the  amounts  and  deposited them  into  the  bank  account  of  his  then-girlfriend.  Tjong  then  received  these amounts by way of two cheques issued by his then-girlfriend.

Decision and Observation

Tjong was charged  with two counts of corruptly obtaining gratification as an agent under Section 6(a) of the Prevention of Corruption Act (Cap 241, 1993 Rev Ed) (the “PCA”) in respect of the two sums he had received from Mujibur. The trial judge found an objective corrupt element based on the fact that Tjong had accepted money as part of a profit-sharing scheme, intending it to be his reward  for  having  recommended  Mujibur  to  be  appointed  STE’s  agent. However,  the  trial  judge  found  that  Tjong’s  explanation  in  respect  of  the second charge (i.e. that Tjong took the sum to help Mujibur with errands and to remit money to Mujibur’s son in London) raised reasonable doubt as to its purpose. Tjong  was therefore convicted on the first charge but acquitted  on the second. On  appeal,  the  High  Court  overturned  Tjong’s  acquittal  in  respect  of  the second charge and convicted him on both charges.

Elements of an Offence Under Section 6(a) of the PCA

To establish an offence under Section 6(a) of the PCA, it must be shown that: [1]

  • gratification was accepted;
  • the gratification was an inducement or reward (for any act, favour or disfavour to any person in relation to the recipient’s principal’s affairs or business);
  • there was an objective corrupt element in the transaction; and
  • the recipient accepted the gratification with guilty knowledge.

The second and third elements are conceptually different, but are part of the same factual enquiry, namely “whether the recipient received the gratification believing that it was given to him as a quid pro quo for conferring a dishonest gain or advantage on the giver in relation to his principal’s affairs”. [2]  The High Court,  in  assessing  this,  reduced  the  arguments  on  appeal  into  two  broad issues.

Issue  1: Whether  Tjong  Favoured  Mujibur  in  Relation  to  STE’s Affairs

To  prove  corruption  in  cases  where  gratification  was  received  after  the allegedly corrupt conduct had  occurred, the evidence must at least  lead the court  to  infer  that  the  idea  of  gratification  was  already  operating  in  the accused’s  mind  at  the  time  the  allegedly  corrupt  conduct  occurred.  In  other words, there must be some “advantage gained or hoped to be gained by the giver”. [3] If  Tjong  had  no  contemplation  that  he  might  be  getting  a  reward  when  he recommended  Mujibur  to  STE,  any  subsequent  receipt  of  gratification  could well be a gift or, at worst, a breach of an employment contract or a code of conduct or ethics. Such a situation could not amount to corruption. On  the  facts,  the  High  Court  was  of  the  view  that  there  was  enough circumstantial evidence to support the inference that Tjong did contemplate a reward. They were as follows:

  • Tjong  was  instrumental  in  Mujibur’s  appointment  as  an  agent.  He must  have  known  of  the  level  of  influence  he  enjoyed  in  respect  of STE’s  affairs  in  Bangladesh,  as  he  was  STE’s  sole  representative there. His positive recommendation therefore carried much weight.
  • Although it is not corrupt to reward someone for doing what he was already  supposed  to  do,  Tjong  went  beyond  what  a  business development  manager  would  do  in  helping  Mujibur  win  the  project tender.  The  events  that  happened  after  indicated  that  Tjong  was motivated by more than just altruism or a sense of duty to STE.
  • Tjong must have known that sharing of profits was a common practice in  Bangladesh  after  spending  time  there.  Tjong  had  asked  no questions and shown no hesitation when Mujibur offered to share his agent fee. In fact, Tjong told Mujibur to speak to him in Dhaka and to bring  his  chequebook  along.  This  showed  the  underlying  unspoken understanding between them and demonstrated that Tjong’s conduct was not entirely above board.

Although the High Court also observed some other factual circumstances, it held  that  they  were  inconclusive  and  did  not  prevent  corruption  from  being established. These other facts are as follows: The lack of an agreement or discussion does not prevent a finding of corruption. Corruption can be disguised as rewards after the event.

  • Corruption can be found in both one-off and continuous dealings.
  • STE’s  subsequent  acts  of  appointing  Mujibur  on  his  merits  did  not override any corruption that Tjong had committed.
  • The  fact  that  Tjong  could  account  for  Mujibur’s  qualities  was inconclusive. It was possible that by favouring Mujibur, Tjong did not bring forward other worthy candidates for consideration.
  • Parties  can  approach  a  transaction  with  different  frames  of  mind. Mujibur’s characterisation of the reward as a legitimate profit-sharing scheme did not change the fact that the idea of a reward operated in Tjong’s mind when he facilitated Mujibur’s appointment.

On  the  facts,  the  High  Court  found  that  Tjong  had  favoured  Mujibur  in derogation of his duties to STE.

Issue 2: Whether Tjong Accepted the Two Cheques as a Reward for Recommending Mujibur to STE

Mujibur’s  and  Tjong’s  explanations  of  the  purpose  of  the  cheques  were completely different. Mujibur explained that it was a sharing of profits, whilst Tjong  insisted  that  the  cheques  were  for  him  to  run  Mujibur’s  “errands”. Mujibur’s  explanation  was  found  to  be  far  more  consistent.  Tjong’s explanation,  on  the  other  hand,  was  riddled  with  difficulties  and inconsistencies that could not be satisfactorily explained. The  High  Court  held  that  the  trial  judge  had  erred  in  elevating  the  mere possibility that the second cheque was for paying the tuition fees of Mujibur’s son, as contended by Tjong, into a reasonable doubt. Moreover, Tjong failed to  report  the  gifts  to  STE,  breaching  his  employment  contract.  The contravention  of  rules  designed  to  prevent  bribery  would  “invariably”  mean that the transaction is objectively corrupt. [4] Tjong’s  explanation  of  the  cheques  was  found  to  be  untenable,  and  was rejected by the High Court.

Sentencing

In respect of the first charge, the High Court affirmed the sentence of 8 weeks’ imprisonment  together  with  a  penalty  of  S$57,386.67  (in  default,  3  months’ imprisonment). This was on the basis that Tjong was in a position of influence, the gratification received was substantial and Tjong acted with premeditation and deliberation in trying to cover his tracks by disguising the sum received. Although  STE  did  not  suffer  any  direct  monetary  loss,  Tjong’s  duty  to  STE was nevertheless compromised. In respect of the second charge, the High Court took the view that the same factors regarding the first charge applied equally to the second charge. The High  Court  therefore  sentenced  Tjong  to  4  weeks’  imprisonment  (to  run consecutively with the imprisonment term for the first charge) together with a penalty of S$30,000 (in default, 6 weeks’ imprisonment). The High Court held that  consecutive  imprisonment  terms  were  necessary  as  the  two  charges were  in  reality  one  transaction  of  corruption.  Moreover,  the  transaction involved  a  cross-border  commercial  element,  and  STE  was  a  government-linked entity. The harm caused by the offences included the possible adverse impact  on  the  reputation  and  integrity  of  Singapore  companies  and  of Singapore generally.

Comments

This case establishes that the lack of an agreement or discussion prior to the event  does  not  prevent  a  finding  of  corruption  from  being  made.  It  can  be established  even  if  an  agent  discussed  the  idea  of  a  reward  with  the  third party only after acting in relation to his principal’s affairs. The crucial inquiry is whether the agent, in carrying out his duties, showed favour to the third party or  was  tainted  by  the  contemplation  of  a  reward.  If  not,  the  meaning  of corruption  would  be  too  wide  and  might  turn  innocuous  gifts  or  mere contractual or ethical breaches into crimes.  

 Footnotes

[ 1]  Kwang Boon Keong Peter v. Public Prosecutor [1998] 2 SLR(R) 211 at [32], and later reiterated by the Court of Appeal in Public Prosecutor v. Leng Kah Poh [2014] 4 SLR 1264 at [20]. [2]  Tey Tsun Hang v. Public Prosector [2014] 2 SLR 1189 at [17], and quoted in Public Prosecutor v Leng Kah Poh [2014] 4 SLR 1264 at [22]. [3]  Sairi bin Sulaiman v. Public Prosecutor [1995] 2 SLR(R) 794 at [40]. [4]  Chan Wing Seng v. Public Prosecutor [1997] 1 SLR(R) 721 at [20].

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