Hospital seeks to recover $5.7m from third-party buyers of ‘stolen goods’ including milk powder
Khoo Teck Puat Hospital (KTPH) had taken further steps to recover millions from third-party buyers who had bought goods that were allegedly stolen by one of its former employees.
The hospital alleged that the buyers, Cantley Lifecare and its directors Henry Hoe Yong Zhi and Soh Tian Hwee, had received a total of about $5.7 million worth of “stolen goods”, including milk powder, over a span of eight years.
Mr Hoe had traded for a period of time as a sole-proprietorship under the business name of Seniorcare.
In its statement of claims filed in the High Court in August, KTPH accused the three defendants of bribing its former senior retail executive Ray Choo Tiong Hian, inducing him to supply them the hospital’s goods.
The defendants allegedly paid Mr Choo bribes totalling $142,650, or about three per cent of $4.76 million of the total cost price of the “stolen goods” they had received.
Payments for the goods were also made to Mr Choo instead of the hospital.
As a result, KTPH suffered about $5.7 million in losses, as the retail price of the goods would be at least 20 per cent higher than the cost price.
KTPH represented by lawyers Derek Kang and Jolyn Yeo of Cairnhill Law, noted that sometime between 2014 and 2022, Mr Choo had removed or facilitated the removal of at least $6.58 million worth of goods – including milk powder, underpad protectors, and supplements – owned by the hospital and sold them to several third-party buyers, including the three defendants.
As part of Mr Choo’s modus operandi, he would inform the Able Studio team of purported corporate orders from third-party buyers verbally or via e-mail or WhatsApp messages and arrange for the relevant goods to be delivered to, or collected from, various third-party buyers via WhatsApp, e-mail or phone calls.
Able Studio, which sells a wide range of medical products and accessories to meet the geriatric and rehabilitation needs of recovering patients, has an e-commerce website and two physical stores – one at KTPH and the other at Yishun Community Hospital (YCH).
If the defendants had purchased the goods from the hospital using the normal sales procedure via the physical stores or e-commerce website, they would have paid the full retail price or at least 20 per cent more than the cost price of the goods, noted the statement of claim.
In the defence reply filed on Oct 10, the defendants, represented by lawyer Wong Thai Yong of Wong Thai Yong LLC, denied any collusion with Mr Choo. They also said that they were not privy to what Mr Choo’s modus operandi was.
The defendants argued that they had paid Mr Choo a sales commission to assist them in procuring the goods directly from suppliers – the same suppliers with whom Mr Choo dealt with in his capacity at KTPH.
The defendants claimed they were not aware that the goods were stolen, and said the goods were sometimes collected from the retail store front and not from a storeroom, as the hospital had alleged.
They believed that the goods they had purchased were from the hospital’s suppliers, which they had managed to obtain by tagging on additional orders to the suppliers through Mr Choo.
The defendants said they had paid Mr Choo for the goods as they believed that the monies would be paid by Mr Choo to the suppliers. They added that they would not have purchased the goods from KTPH for the full retail price.
The alleged theft came to light after a member of the public alerted the National Heathcare Group (NHG) in June 2022 to suspicious activity involving the sale of milk feeds on online marketplace Shopee, with stocks bearing the address label of YCH.
In September 2022, KTPH sued Mr Choo, who had worked at the hospital from February 2008 till his dismissal in June 2022.
The hospital was awarded a default judgment last November for the sum of $5.6 million with interest against Mr Choo for breaching his contractual and/or fiduciary duties.
While the police investigation into Mr Choo’s activities continues, the NHG has taken steps to ensure that similar breaches do not occur in the future, including the commissioning of an independent team of hospital operations.