TR EMERITUS

No matter how strict the banking regulators, how incorruptible and well-qualified its personnel, and how good the legislation, no country is spared the occasional crisis of financial fraud, huge credit defaults, money-laundering, and bank failures. Singapore has had its fair share. The worst on the patch was the 1995 failure of Barings Bank due to fraudulent options trading conducted by its Singapore branch. Much has been written and spoken about the affair but none has ever suggested attribution to regulatory failure. In my humble opinion, a policy meant to shield MAS personnel from influence buying takes some blame. During my time in the banking industry, MAS personnel were basically forbidden to accept even lunch invitations from the banking fraternity. Their absence from the drinking holes and other socialising functions meant they were like generals commanding from HQ, unwary of what's going on in the foxholes. They do not have their hands on the pulse, thus missing out on critical intel. For example, in the case of Barings, regulatory personnel had no idea what the market had long suspected was going on at their options trading desk. MAS was two or three steps behind. More serious a matter is where a financial entity is being operated by foreign governments or agents for cloak and dagger operations. Has there been any in Singapore? I blogged about Nugan Hand Bank last year in the article on "Truman shows". Back in 1978 when I was working in a bank, I had lunch with a friend one day. I shall conceal any trace to ID this friend. Just suffice to say I found him a very mysterious and mystical character given to access to some information that few have. He seems to have a knack for any subject matter that creeps up in idle conversation and acquainted either directly or indirectly with personalities referenced. I had long suspected him to be working for some Intelligence organisation. On his part, he enjoys my company because he said, unlike most ordinary folks, I could engage him in all sorts of unusual subject matter, a compliment I attribute to my scattered interests and I was widely read at the time, devouring magazines like Newsweek, The Economist, Time Magazine, Financial Times etc. Over lunch that day, I brought up the matter of Nugan Hand Bank opening a branch in Singapore. He asked what I thought of the matter. I felt it strange that MAS should approve the licence for a bank that had hardly any history (it was incorporated in Australia in 1973), without any reciprocity which has been MAS policy, and owned by a couple of guys no one in the industry knew. He told me he knew one of the co-founders, Michael Hand, back in Vietnam War days. According to him, Hand was a decorated Green Beret, but was already dabbling in drugs during the war. Nugan Hand was set up as CIA banker, sourcing funds from drug operations. Today one can google and dive deep into the CIA-drugs-gun running-money laundering operations of Nugan Hand. But back in 1978 we had no access to any info. Of course I took my friend's claims with a pinch of salt. Then to my amazement, in 1980 Frank Nugan, the partner of Hand, was found dead in a car in Australia, execution style. The bank collapsed in 1980 under a cloud of massive fraud and criminal activities including drug trafficking. Hand disappeared, lots of international investigation and inquiries, but no one went to jail. Except one - the accountant Mr. Tan who ended up in Singapore jail on account of the fact he was the Local Principal of the branch. Innocent chap, the sacrificial goat to close the chapter in Singapore. As to why MAS issued a banking licence to a practically unheard of entity which operated a branch in the Golden Triangle of Burma, let's just label it under "mystery". To make sense of all these, we should take a look at how MAS handled another interesting foreign bank application. BCCI was founded by Pakistani private banker Agha Hasan Abedi. It was incorporated in Luxembourg in 1972 . It counted Middle Eastern royalties amongst its shareholders. At its height, BCCI was one of the largest private banking groups in the world with a presence in 69 countries. BCCI desired to set up a branch in Singapore and submitted an application for an offshore banking licence in 1973. It was rejected as the bank had no track record. In following years, BCCI doggedly sent their executives to meet MAS managers. One such lobbyist was Van Oenen, head of BOA Singapore, who was one time a BCCI director when BOA was a shareholder. Van Oenen was well-known to MAS, having helped advise the setting up of the Asian Currency Unit. In 1980 BCCI re-applied unsuccessfully. MAS rejected BCCI again, this time on grounds of its poor international standing. Van Oenen met with Dy PM Goh Keng Swee and Finance Minister Hon Sui Sen to appeal for reconsideration. MAS re-studied the status of BCCI and denied the request. BCCI tried again in 1985 with a letter of recommendation from British PM Harold Wilson to Lee Kuan Yew. Once again, MAS did not approve the application. MAS' decision had considered feedback from banks and regulators in the jurisdictions where BCCI operated, advices of other central bankers and international banks, and its own instincts when reviewing the bank. One key issue was BCCI used different auditors in different branches and there was a lack of consolidated supervision. MAS stressed their decisions were never "dazzled or intimidated by well-known names or high-powered connections", or majority opinion, but strictly disciplined on "principles of ensuring that any institution admitted to Singapore must have high prudential standards, a strong international reputation, and management with integrity." MAS was proven right when BCCI collapsed in 1991 with US$15b missing from its balance sheet, making it the biggest bank fraud in world history. The bank moved dark and dirty money of mafias, human and drug traffickers, weapons' traders, corrupt money of dictators and despots. It loaned huge sums to shareholders. In his memoir, Lee Kuan Yew mentioned this episode. He had concluded Harold Wilson's letter was merely a pro-forma he signed doing someone a favor. It was not a personal appeal to him. He had observed the endearment "Yours Sincerely" was type written. It should have been hand written in a personal letter. On that score he supported MAS' decision to reject the BCCI yet again. One wonders had the letter been personal, would Lee Kuan Yew have been 'dazzled' by Harold Wilson's recommendations and override MAS' decision? MAS' disciplined approach to vet applicants is to be lauded. But the question no one asks is why did it not apply in the case of Nugan Hand Bank? In fact, Nugan Hand was not an isolated case. The same level of rigour in assessing applicants was also not applied in the case of Tat Lee Bank. Coming up - Part 2 (Moscow Narodny Bank)   Patrick Low * Article first appeared on Down The Rabbit Hole.    Read More →

That really depends on how approachable we are. Living with us for years, they know viscerally our, well, pattern. It boils down to our response, right? Do we inspire hope and confidence or instil fear, or worse, dread? Former journalist Kelly Tay wrote an article about it and it’s chariot-led by this statement: “Here is the uncomfortable truth: that we, as a society, continue to let kids down.” “And that is where the deepest tragedy lies: the fact that our teens do not feel they can turn to an adult - whether a parent, teacher, mentor or spiritual leader - in their darkest moment of need.” Kelly is a mother with two kids. She is now a parent coach (of Juicy Parenting). She caveats that this is not an exercise in parent-bashing, and she has worked with hundreds of families and know they are doing their best. Nevertheless, some may find her statement sweeping. It’s trite to say that there is always two sides to a coin. I understand the regrettable tragedy where kids don’t feel safe or assured to share with parents their intimate secrets. And this emotional distance turns cold over time and somehow nothing is done about it. We just let status quo remain, because it is the road of least resistance, or one most convenient. Yet, it could also be more complex that that, like the parents themselves are struggling with bread-and-butter issues, and perceived time is often more kind or generous to a well-to-do family than a family that is, well, less well-off. I am sure Kelly knows that too. That said, one reality can’t be denied: we came first. We made the conscious decision to have them. We are their guardians. We should know better. That is why the first go-to when our kid screw up is, “That is so-and-so boy or girl”. The finger points to the one who is supposed to lead the way. That is also why a child makes his or her parents proud. A parent that beams with pride is a form of self-congratulation and validation. The onus is thus on us to strap up and ride through with maturity. It is said that the difference between parents and children is responsibility. Kids and parents alike know their rights, and they know what is right and wrong, to varying degree. But parents set the life-affirming boundaries for them, and live up to these set-boundaries as a guiding and inspiring example. What is sauce for the goose is always sauce for the gander. I believe to do as I say and not as I do is one of the reasons our kids can’t trust us with their well-kept secrets. Kelly addresses another issue: the blame and shame culture. Her examples are glaring. When a child was being bullied in school, and she finally plucked out the courage to tell her parents, their first reaction was: “So what did you do to deserve to be bullied?” “Or when a crying teenager told her mother that she just got groped by a passing cyclist, and the reply was: “Well, it’s your fault your breasts are so big.”” Kelly urges parents to provide a safe space for their kids so that they could feel free to share their deepest hurts and pains (and shame). Don’t always think that we know best, and over time, let that mindset ossifies into a self-righteous edifice. Sometimes we hear but not listen, see but not observe, advise but not assure, support but not sincere, forgive but make sure they never forget, and be too silent for our own good. Nothing is more toxic to parenting than to misconstrue a situation, thinking that our restraint ought be interpreted as being patient, understanding and kind. At times, our restraint sends a different signal, that we have given up on him or her. Our silent treatment changes us and them, and adds to the cold distancing. Let me end with a sound quote. In the article, Kelly quoted Harvard professor Amy C. Edmondson, on creating psychological safety for our kids, to encourage candour, confidence and camaraderie. It is defined as “a belief that one will not be punished or humiliated for speaking up with ideas, questions, concerns, or mistakes, and that the team is safe for interpersonal risks.” “Psychological safety is not at odds with having tough conversations. It is what allows us to have tough conversations.” True. Candour only comes with the strong relationship. When we connect deeply, we share more freely. And parents have a steeper slope here, because they know us, day in and day out. We are not unfamiliar faces that they meet and walk away from. And the greater tragedy is that we become no better than strangers in the home, because of the walls that have been built up over the years of toxic blaming and shaming, with words and silence reinforced by mutual contempt. And it is true that once in a while we should engage in tough conversations with them. Tough conversations come with knowing that we can be trusted, and they can feel safe with us. At times, creating psychological safety would require us parents to have a high level of self-critical, self-awareness. We may be so ear deep in our own inflexible / ossified ways that nothing short of wielding sledgehammer in our own hands will do to break down that wall. Personally, I have to learn on that front. At times, I catch myself regretting what I say and do. Well, that’s parenting. Yes, it’s also lifelong learning. You don’t graduate from it, and at some point, the most rewarding part of the journey is when your kids come to you, exchanging notes with you, and asking, how to parent their own kids.   Micheal Han    Read More →

Mr Lee Tee Tong was one of 13 elected Barisan Sosialis candidates in the September 1963 general election. If Operation Coldstore (2 Feb 63) had not taken place earlier that year, the ruling PAP would have been trounced. Mr Lee Kuan Yew and his team knew their chances of winning was non-existent. That was why they misused their power with the help of the British and the Tunku. They arrested more than 130 members of the opposition, leaders of trade unions, activists, students and even school children under the ISA. Almost all members of the Central Executive Committee of the Barisan Sosialis were arrested. Many of them were tortured and imprisoned for decades. Having taken all the prominent political opponents to prison, the PAP was surprised that Barisan Sosialis was still able to field 46 candidates in the September general election and won 13 seats. Afraid of losing power even though the PAP had won 37 seats, they arrested Mr Lee Tee Tong who represented Bukit Timah, Ms Loh Miao Gong (Havelock) and Mr S T Bani (Crawford) on 8 October 1963 under the ISA even before the legislative assembly was convened. It was deliberate. It is pretty incredible that three parliamentarians could strike so much fear in the leadership of the PAP that they had to resort to such cowardly action. But that has always been the opus operandi of the PAP. They are afraid of any form of opposition, no matter how miniscule they may be. Their policy has always been “NIP IN THE BUD”. In 2005, Mr Lee Tee Tong gave an interview to historian Dr Loh Kah Seng. See chapter 11 of THE 1963 OPERATION COLDSTORE IN SINGAPORE, COMMEMORATING 50 YEARS. That interview was not made public until the publication of the book in 2013. According to Dr Loh, Mr Lee Tee Tong did give an interview to The Straits Times in April 2011. Mr Lee Tee Tong was born in 1932 on Hainan Island, China. He came to Singapore at the age of eight. Escaping the war in China, he landed in Singapore at the beginning of the war! But he survived. He started work at 16. He was a blue collar worker, mastering many trades. Back then, the general population, especially the Chinese educated were deeply involved in social issues. Workers were paid badly and there was high unemployment. It was natural for Mr Lee to be involved in the activities of workers. Mr Lee Tee Tong joined the PAP when it was founded in 1954 because he believed in the ideals of the party. He joined the trade unions when these entities were legalised under the Marshall Government. He left the PAP to join the Barisan Sosialis when he realised that the PAP did not practise socialism even though that was the foundation of the party. Mr Lee was an orator and it was natural for him to be picked as a candidate for Bukit Timah after Operation Coldstore wiped out the entire leadership of the Barisan Sosialis. He was imprisoned for 18 years. Rest in peace Mr Lee Tee Tong.   Teo Soh Lung There will be a memorial service at 8pm tonight at Block 157 Lorong 1, Toa Payoh, Singapore.  Read More →