Woman admits buying semi-detached properties on behalf of 3 foreigners before they obtained citizenship

SINGAPORE: A Singaporean woman bought three semi-detached properties for three foreign friends, intending to transfer ownership of the property to them once they obtained Singapore citizenship.

Song Fanrong, 49, admitted to her crimes on Tuesday (Dec 14). She pleaded guilty to one charge under the Residential Property Act of purchasing an estate in a restricted residential property with the intention of holding it in trust for a foreigner.

Another two similar charges for the other two properties will be considered in sentencing.

The court heard that Song got to know Wang Chen, a China national, in 2013. Wang wanted to emigrate from China to Singapore and own his own home there. He told Song of his intention, and Song recommended an estate known as Belgravia Villas.

Belgravia Villas is a freehold private residential cluster housing estate developed by the Fairview Development in the Seletar and Yio Chu Kang area. It is classified as not being a non-restricted residential property under the Residential Property Act, said Deputy Public Prosecutor Hon Yi.

Song told Wang that he would not be eligible to buy the property in his own name, as he was a foreigner. She offered to buy it on his behalf and to transfer ownership of the property to him once he obtained Singapore citizenship.

Wang accepted this offer and signed a trust agreement with her, stating that he was the buyer and actual owner of the property while Song was merely a trustee. The agreement also stated that Wang was to bear all costs in relation to the property and make payment for it by transferring money to Song's bank account in China.

Wang paid S$1.8 million to Song via a bank transfer to her China bank account.

On Sep 22, 2014, Song entered into a sales and purchase agreement with the developer of Belgravia Villas for the purchase of a unit there. The total purchase price was S$3.48 million, and Wang's S$1.8 million was used for partial payment.

Song also bought two other units in the Belgravia Villas housing estate for two other foreigners that same year: China nationals Chen Xiaopu and Liu Guohui. The foreigners provided the funds to her for the purchase price, while she held the properties in her name.

The three China nationals subsequently stopped paying for the properties, defaulting on all three sale and purchase agreements when their progressive payments became due but went unpaid.

In August 2017, the Commercial Affairs Department received a report from the Singapore Land Authority about Song, saying that she had purchased four semi-detached properties at Belgravia Villas that were restricted residential properties.

After the agreements were defaulted on, Fairview Developments deducted the contractual penalties from the sums already paid by the foreigners through Song. The rights of Song and the foreigners were extinguished, and Fairview Developments surrendered the remaining S$1.6 million. The sum was seized by CAD in January 2018.

SHE SUGGESTED BUYING THE PROPERTY ON THEIR BEHALF: PROSECUTOR

Deputy Public Prosecutor Hon Yi asked for a jail term of one month, saying that Song was the one who suggested being a nominee to purchase the properties on the foreigners' behalf, despite knowing that foreigners could not buy such properties.

"In Singapore, land is a scarce commodity, and residential properties are priced to match. In particular, freehold and landed properties are especially prized by many," said Mr Hon.

"Such properties generally hold their value well, and often appreciate over time. Apart from providing homes for people, it is also known that property is a good investment ... we thus have laws in place to keep foreigners from buying up, and possibly speculating in, land in Singapore," he said.

Song took steps to cloak her nominee arrangement with "the veneer of legality", concealing the source of payments by receiving her funds in China, out of sight of local banks and authorities, said Mr Hon.

He asked for the sum of about S$1.6 million to be confiscated. The sum was initially meant to be paid by Fairview Developments to Song, as she is the purchaser of the three properties on paper. Song is now bankrupt.

Defence lawyer Alain Abraham Johns said that "there was no intention by the accused to profit" in the transactions.

"Where the three foreigners are concerned, all three foreigners intended to apply for Singapore citizenship, that was their intention ... the properties were to be transferred back to them once they became Singapore citizens," he said.

"There was no dishonesty on the part of the accused. She was merely assisting the three foreigners, who were her friends," said the lawyer.

Song will return to court for sentencing in January. The penalties for buying a restricted residential property on behalf of a foreigner are a maximum jail term of three years, a fine of up to S$100,000, or both.