SINGAPORE: Former BSI banker Yeo Jiawei was on Wednesday (Jul 12) sentenced to four-and-a-half years jail for money laundering and cheating, in a case linked to an investigation involving Malaysian state fund 1Malaysia Development Berhad (1MDB).
Yeo, 34, had set up multiple suspicious transactions involving 1MDB, and admitted he secretly profited at least US$3.5 million from the illicit transactions. He laundered a portion of the money by transferring at least US$500,000 into his parents’ bank account.
The former wealth planner is already serving a 30-month term on charges of perverting the course of justice by tampering with key witnesses in order to frustrate the Commercial Affairs Department’s (CAD) investigation into his alleged involvement.
YEO COVERED UP COMPLICATED TRANSACTIONS: PROSECUTOR
While he was employed by BSI Singapore from 2009 to 2014, Yeo not only had a hand in transactions involving 1MDB, but also its wholly-owned subsidiary Brazen Sky.
He also worked with Malaysian businessman Low Taek Jho, better known as Jho Low, who was one of the bank’s “most important clients” and a very influential figure dealing with 1MDB.
In September 2009, 1MDB entered into a joint venture with PetroSaudi International Limited, a District Court heard on Wednesday. It was agreed that 1MDB would provide US$1 billion as capital, in return for one billion shares in the joint venture – equivalent to a 40 per cent stake, prosecutors said.
Through a series of complicated transactions, the prosecutor said Yeo designed to cover up the fact that the US$1 billion belonging to 1MDB had been transferred into Mr Low’s bank account. The money was then diverted into the bank account of a company known as Good Star, owned by Mr Low.
“Jho Low received huge sums of money traceable to 1MDB”, Deputy Public Prosecutor Nathaniel Khng said, adding that he used the money “for his own benefit”.
In June 2012, 1MDB asked BSI Singapore to help it “restructure” its joint venture agreement with PetroSaudi International Limited. Mr Low was “closely involved” in the transaction worth more than US$2 billion and Yeo was the one who handled the request.
Yeo arranged to secretly make a profit to the tune of US$1.6 million per year, by arranging to receive a cut of BSI Singapore’s management fees behind the bank’s back, effectively cheating his employer of over a million dollars.
His boss, Mr Kevin Michael Swampillai, was also in on the deal. Mr Swampillai testified for the prosecution at Yeo’s witness-tampering trial. He claimed Yeo had told him to lie to investigators to protect him. Mr Swampillai has not been charged.
In 2013, 1MDB asked BSI Singapore to handle another series of transactions. Again, Yeo was involved and was able to arrange another round of secret profits for himself and Mr Swampillai. He pocketed another US$233,443 in September that year.
The prosecutor urged the court to sentence Yeo to a jail term of 54 months (four-and-a-half years), saying the former banker played “a central role” in the illicit transactions involving 1MDB, and had corruptly organised a “secret profit scheme” for himself.
The prosecutor said he had “carefully calibrated” the sentence to take into account Yeo’s “severe offending”, but also considered that Yeo intends to make full restitution. He added that Yeo has given an undertaking to liquidate all his assets, including property in Australia and to transfer the proceeds to Singapore for surrender to the authorities.