Minister Indranee Rajah on the Public Prosecutor's Decision to Issue Stern Warnings to Six Former Senior Management Staff from Keppel Offshore & Marine Limited

Oral Answer to Questions in Parliament by Minister in the Prime Minister’s Office, Second Minister for Finance and Second Minister for National Development Indranee Rajah, on the Public Prosecutor’s decision to issue stern warnings to six former senior management staff from Keppel Offshore & Marine Limited, on 6 February 2023.

Mr Speaker, may I have your permission to take PQs No 23 to 39 in the Order Paper, together? Thank you, Mr Speaker.

My response to these PQs would also effectively address the PQs by MPs Hazel Poa and He Ting Ru for written answer today, and the PQs by MPs Dennis Tan, Gerald Giam, Dr Wan Rizal and Ms Poa scheduled for subsequent sittings. The Members may wish to raise any supplementary PQs arising therefrom, and withdraw the Questions for later Sittings which are answered today.

Introduction

Mr Speaker, the questions arise from the Public Prosecutor’s (“PP”) decision to issue stern warnings to six former senior management staff from Keppel Offshore & Marine Limited (“KOM”), some of whom used to work at KOM’s wholly-owned US subsidiary at relevant times.

The questions raised by Members fall into the following broad categories:

(a) Why were the 6 individuals issued with stern warnings instead of being prosecuted?

(b) whether, and if so why, the Deferred Prosecution Agreement (DPA) and the accompanying Statement of Facts (SOF) are insufficient to mount a prosecution?

(c) details of the investigations or decision to issue stern warnings;

(d) why the 6 individuals in question were not named and whether they should be?

(e) statistics on stern warnings and prosecutions;

(f) whether the decision to issue stern warnings instead of prosecuting will affect our zero-tolerance stance on corruption and reputation?

(g) Corruption in foreign jurisdictions;

(h) Sufficiency of the Prevention of Corruption Act (PCA)

Preliminary Issue – CPIB’s Press Release

Before I answer these questions, let me deal with a preliminary point.

There has been a fair bit of speculation – on why CPIB did not issue a fuller statement or why the Government is dealing with the matter in Parliament – which is based on a lack of understanding of how these matters are usually dealt with.

First, the CPIB had explained the reasons for its decision in its Press Release. With your leave, Mr Speaker, may I ask the Clerks to distribute copies of the Press Release to Members. Members may also access the handout through the SG Parl MP mobile app. You would see, at paragraph 5, that CPIB explained:

This case is complex and transnational, involving multiple authorities and witnesses from several countries. There are evidentiary difficulties in cases of such nature. Many of the documents are located in different jurisdictions. In addition, key witnesses are located outside of Singapore and cannot be compelled to give evidence here. The decision whether to prosecute the six individuals for criminal offences has to take into consideration all relevant factors, such as the culpability of each individual, the available evidence and what is appropriate in the circumstances. Having taken these into consideration, stern warnings were issued to the six individuals.

Police and other law enforcement agencies investigate a vast number of cases. When they do not proceed, the standard practice is not to issue any statement.

Where there is public interest in knowing more details, MPs may file questions in this House. And the relevant Minister will, after consulting the PP (who made the decision independently), answer the questions to the extent permitted in law. That is what is happening here, in this case.

I think members will agree – in general, when the law enforcement agencies do not proceed to charge someone after completing investigations, it is not expected that the agencies go into details of the decision. But if anyone has questions on the decision, the matter can be raised in Parliament. That is what we are doing now.

Now let me deal with questions which I have identified.

Reasons for Issuing a Stern Warning rather than prosecution / Sufficiency of DPA and SOF

First, the reasons for issuing a Stern Warning rather than prosecution, and the sufficiency of the DPA and SOF. Decisions on charging are made by the Public Prosecutor. In deciding whether to charge, the PP has to consider whether he has the necessary evidence to prove that those individuals were involved in certain conduct and possessed a certain mental state, to establish the offences. In this case, as CPIB explained in its media release, there are evidentiary difficulties in doing so.

Simply put – there is a lack of sufficient evidence, either documentary, or through witnesses, which would establish any criminal charge beyond a reasonable doubt against a specific individual. The Attorney-General’s Chambers (AGC) has made a number of mutual legal assistance requests over five years. To date, the findings from these requests are insufficient for prosecution, as I will elaborate later.

Given this reality, I would like to know if any Member thinks that nevertheless, even without sufficient evidence, the PP should have proceeded to bring charges against individuals, who deny the allegations against them. If so, please let me know, and basis on which you say so.

Now, does the fact that KOM had entered into the DPA make a difference in this matter, and would the DPA be enough to at least commence prosecution against the specific individuals in question?

The answer is No.

The DPA and related documents were entered into between KOM, the US Department of Justice and the US Attorney’s Office. KOM USA, a wholly-owned subsidiary of KOM, also entered into a plea bargain agreement with the US authorities. No individuals were parties to these documents. While the documents make references to the actions of certain individuals, I have been advised that those references, on their own, are insufficient to establish any offences beyond reasonable doubt without witnesses testifying in Singapore about the context surrounding those actions and the intention behind them.

In short, the agencies do not have sufficient evidence that would show beyond reasonable doubt, that any of the six individuals were guilty of an offence.

CPIB conducted an in-depth investigation within Singapore, within the scope of its legal powers. However, as I said earlier, the difficulty with this case is that several potentially key witnesses are not in Singapore, and CPIB has not been able to secure their cooperation or agreement to testify in Singapore.

With the initial assistance of the Brazilian authorities, CPIB made two fact-finding trips to Brazil in May and August 2019.

AGC and CPIB sent three mutual legal assistance (“MLA”) requests to Brazil to secure evidence that was needed. AGC and CPIB also sent an MLA request to another relevant foreign authority to interview other potential material witnesses. The contents and outcome of these MLA requests are confidential, but I can inform the House that they have either not yielded evidence that could be used to secure a conviction before our Courts, or the responses have not been helpful in advancing the case.

There is one foreign witness who gave evidence in other proceedings, which could have been relevant in establishing the offences in Singapore. However, that foreign witness is not willing to voluntarily give evidence in Singapore. Neither AGC nor CPIB can compel him to do so.

Some Members may ask whether any prosecution could be advanced arising out of the fact that a particular individual had entered into a plea bargain in another jurisdiction, in relation to his involvement in the KOM bribery. When this individual was investigated by CPIB on his return to Singapore, he denied knowing that commissions paid to the agent in Brazil were paid out as bribes. He did not, during CPIB’s investigations, implicate himself or any others in conspiring to pay bribes. Even if the PP applies to a Singapore Court to admit the plea agreement, the agreement did not identify any specific individuals and was made in the context of a plea bargain, and will be given limited weight without further supporting evidence, and in the face of potentially conflicting oral testimony.

CPIB has conducted as thorough an investigation as it could with the information and powers that it possessed. However, given the cross-border nature of this case and absence of key witnesses, CPIB’s investigations could not overcome the evidential difficulties for the purposes of prosecution in a Singapore court.

As such stern warnings were issued.

If subsequently new and compelling facts come to light, it remains open for the PP to reevaluate the decision in the light of the evolving legal and factual matrix.

Details of investigations / decision to issue stern warnings

Ms Hazel Poa asked whether the decision to issue a stern warning was unanimous in AGC and CPIB, and if other agencies were consulted; Mr Louis Chua asked what offences were being considered.

The decision not to charge is made by the PP in the exercise of his discretion and professional judgement, taking into account all relevant considerations. The PP does not tell us whether everyone in AGC agreed with him or if there were differing views, or which agencies he worked with, apart from CPIB. Nor is it our task to ask AGC to list all the agencies which were involved. In the end, what matters is the considered view of AGC, working with CPIB. In response to Mr Chua, I am advised that relevant potential offences were considered by the PP.

Naming of Individuals

Next on the naming of individuals, Mr Dennis Tan and Mr Gerald Giam asked about the identities or details of the six individuals; Mr Murali Pillai and Ms Sylvia Lim asked whether other entities or persons were involved.

As a matter of policy, CPIB does not disclose the names of individuals unless they are charged in court. This policy is not unique to the CPIB; law enforcement agencies in the US, UK and New Zealand have a similar approach. The principle underlying this policy is to avoid prejudicing that individual’s right to due process and also avoid any presumption of guilt in the absence of any formal findings.

If Members feel that hereafter this practice should be changed, and that law enforcement agencies should name all individuals who were investigated, even if in the end no charges are brought, then please say so. That would be a major change of policy. But please note, if Members want a change, then it cannot be only for this case, it must be for all future cases. This is something to think carefully about. Members will recall that, about 2 years ago, a question was in fact raised in this House, asking about the protections available for those whose reputations are affected by media coverage of ongoing trials of certain offences, and how such reports are regulated.

Stern warning / prosecution statistics

Dr Tan Wu Meng sought statistics on prosecutions and stern warnings and Ms Poa asked if warnings were issued in other corruption cases. From 2017 to 2021, CPIB has issued an average of 138 warnings annually and 139 individuals were prosecuted. Stern warnings are not unusual, being used in cases where there are evidential difficulties or little public interest to prosecute.

Impact on Singapore’s Zero-tolerance policy on corruption and reputation

Questions have been asked on the impact on Singapore’s zero-tolerance policy on corruption and reputation. There is no change in Singapore’s zero-tolerance policy in corruption. I have explained the reasons why no criminal proceedings have been brought in this matter. In having regard to the rules of evidence, CPIB and AGC are observing the basic rules for a fair and just criminal justice system. What can be inferred from this is that while Singapore has zero-tolerance on corruption, it also strongly adheres to the rule of law.

Corruption in foreign jurisdictions

Mr Murali Pillai asked in what circumstances CPIB will investigate foreign bribery cases involving Singapore citizens or companies under section 37 of the PCA. CPIB will investigate all cases whether they happened locally or overseas as long as the alleged offences fall under the ambit of the PCA and the information is credible and can be pursued. CPIB will investigate and submit its findings and recommendations to the PP, who will then decide if there is sufficient evidence to prosecute.

On Ms He Ting Ru’s and Ms Hazel Poa’s questions regarding Singapore companies being convicted of corruption abroad, the Ministry of Foreign Affairs (MFA) does not have such records and CPIB’s records do not go as far back as 1965. More recently, in 2015, a Singapore company, Glenn Defense Marine Asia Pte Ltd (GDMA) pleaded guilty in the USA, to bribery-related offences. GDMA was not prosecuted in Singapore as key evidence against the company was not available here and GDMA had been dealt with in the USA. However, Gursharan Kaur Sharon Rachael, the Singaporean employee of the US Navy, was prosecuted here as evidence of her corrupt conduct was available to CPIB, and she pleaded guilty to those offences.

Sufficiency of PCA

Mr Zhulkarnain asked if we will amend the PCA to expand the powers of the CPIB, to facilitate investigations outside jurisdiction. CPIB’s powers under the PCA allow it to investigate offences committed by Singaporeans abroad, but the investigations have to be conducted in Singapore. CPIB cannot conduct investigations abroad. And regardless of what our law says, it is not possible for our agencies to exercise police powers in another country. That would not be allowed or tolerated by any other country, just like we would never allow a foreign investigative agency to exercise police powers in Singapore.

Think of it this way: do you think Singaporeans will or should accept that a regional police force can come into Singapore and interrogate Singaporeans?

Hence, when evidence resides outside Singapore, our agencies are dependent on international cooperation and foreign authorities to facilitate their investigations and secure the relevant evidence. This Parliament cannot legislate to empower CPIB to conduct investigations in foreign jurisdictions, because that would run afoul of territorial sovereignty.

Therefore, members need to be realistic about what we can and cannot do. Singapore companies who operate overseas do so in myriad environments, where all kinds of business practices prevail. We cannot police all of them. However, what we can and should do is to insulate our companies, and our system against corruption. Our companies must find a way to do business cleanly, wherever they do business, and people must know that is how we operate.

Conclusion

In conclusion, the PP decided not to prosecute the six individuals, because the evidence available in Singapore does not provide sufficient evidential basis to prosecute, bearing in mind the Prosecution’s burden is to establish the ingredients of each offence beyond reasonable doubt. The CPIB has done its best, including working with international partners to uncover such evidence. CPIB and AGC have undertaken a careful and thorough review of the documents, including the DPAs and plea bargains, and the PP has advised that those are insufficient to meet the burden of proof. But if subsequently new and compelling evidence comes up, the PP can and will re-evaluate the decision. The PP’s decision to issue stern warnings should be understood in that context.

Mr Speaker, Singapore’s success arises in no small part, because of its policy of upholding the rule of law, and adopting a zero-tolerance policy to corruption. Both are necessary factors, and our zero-tolerance policy must be upheld in a manner that complies with the rule of law. The PP has acknowledged this; and this is exactly what the PP has done on the facts – to uphold the rule of law.