Foreigner who bankrolled house purchases worth $6m fined $45,000, Latest Singapore News - The New Paper

Foreigner who bankrolled house purchases worth $6m fined $45,000

A Chinese national was fined $45,000 on April 18 for breaching a law under the Residential Property Act (RPA) that had been rolled out to prevent foreigners from speculating in local residential properties.

This could lead to a rise in home prices and adversely affect the interests of Singaporeans.

Zhan Guotuan, 59, a Singapore permanent resident at the time of the offences, had provided the money to buy three landed properties in East Coast Road worth more than $6 million in total.

In earlier proceedings, the court heard that none of the three houses were “non-restricted residential properties”. Therefore, foreigners were normally not entitled to buy them.

In 2007, Zhan was a shareholder of two companies – Alphaland International and Xin An Technology Group – that were in the business of property development in Singapore.

The business plan was to buy landed properties here, demolish those houses, develop condominiums on the land and sell the condominium units for profit.

On April 16, he pleaded guilty to an offence under the RPA linked to one of the houses identified in court documents as Z.

Three other charges, including two under the same Act involving the other properties, were considered during sentencing. These two houses were identified in court documents as X and Y.

The prosecution had told the court on April 16 that the “prime mover” in this case was Zhan’s trusted business associate, Tan Hui Meng, a Singaporean.

After a trial, Tan, 57, was sentenced to jail for two years, three months and three weeks in March. He was also fined $3,000.

Deputy public prosecutors Foo Shi Hao and Louis Ngia had stated in court documents: “(Tan) was the one who had conceived of the East Coast plan to purchase seven landed properties for redevelopment, and to buy (the three houses) in trust.

“(Tan) was also the one who had made the arrangements for the purchases. (Zhan’s) offending conduct was in authorising (the acquisitions)... when the plan had already been conceived.”

According to Tan, the estimated profit from the land redevelopment in East Coast Road was over $50 million, and he was to get 20 per cent of the profits from two of Zhan’s companies.

Zhan was overseas some time in or around early 2007 when Tan entered into a plan to pursue Zhan’s property development business in East Coast Road on the Chinese national’s behalf.

X and Y were then bought with Zhan’s money.

In earlier proceedings, the court heard that one of the houses was transferred to Tan in May 2007.

According to court documents, the other house was bought in the name of Guan Aimei, the wife of one of Alphaland’s employees. Its legal title was transferred to her on July 2, 2007, and she had been fined $5,000 over her role in the offence.

On July 13, 2007, Tan procured an option to buy Z. He also incorporated a firm called Hwampoa, which had no employees and no business operations. Instead, it was formed for the sole purpose of purchasing and holding the East Coast Road properties.

Zhan later authorised Hwampoa to acquire Z, which was bought for $2.4 million.

The prosecution had earlier asked for Zhan to be given the maximum fine, adding that they would have sought a jail sentence for him if not for several mitigating factors.

Among other things, Z was later sold and Hwampoa voluntarily surrendered $2.1 million. Zhan had also voluntarily surrendered another $2.3 million.

After committing the offences, Zhan was charged in a Singapore district court in 2017 before he returned to China.

He was overseas when he had a warrant of arrest issued against him in 2022. He finally returned here on March 1, 2024.