22 January 2020
On 1 January 2020, major amendments to the Penal Code introduced by the Criminal Law Reform Act came into force. This article highlights the key amendments relevant to white-collar crime.
New fraud offence
The Criminal Law Reform Act amends the Penal Code to introduce a new offence of fraud. This new offence, adapted from the UK Fraud Act 2006, will be committed when any person fraudulently or dishonestly (a) makes a false representation, (b) fails to disclose to another person information which he is under a legal duty to disclose, or (c) abuses, whether by act or omission, a position he occupies in which he is expected to safeguard, or not to act against, the financial interests of another person. Unlike the offence of cheating in section 415 of the Penal Code, this new offence does not require that the victim was induced to do or omit to do certain acts, which act or omission causes or is likely to cause damage or harm to any person. Instead, the new offence focuses on the dishonest or fraudulent intent and acts of the accused person (and, hence, the culpability of the offender) and not their effect on an alleged victim. In fact, it does not require an identifiable victim.
The new fraud offence comprises two variants:
- Fraud directly in connection with written or oral contracts for goods and services (section 424B): In a press release issued by the Ministry of Law (“MinLaw”) on 27 December 2019, it was stated that this provision will be brought into force after a mechanism allowing victims to seek recourse for more common cases involving smaller losses is developed.
- Other types of fraud (section 424A): This has entered into force.
Both variants are punishable with imprisonment for a term which may extend to 20 years, or with a fine, or with both.
Criminal breach of trust
The previous section 409 of the Penal Code set out enhanced punishment for criminal breach of trust (“CBT”) when committed by a person “in his capacity of a public servant, or in the way of his business as a banker, merchant, a factor, a broker, an attorney or an agent”. In Public Prosecutor v Lam Leng Hung  SGCA 7, the Court of Appeal agreed with the High Court that section 409 did not cover directors of corporations, governing board members or key officers of a charity, and officers of a society. Such persons committing CBT would therefore have been punished instead under section 406 for criminal breach of trust simpliciter.
With the amended section 409, enhanced punishment now applies to persons who are entrusted with property:
- in his or her capacity as a public servant;
- in the way of his or her trade, profession or business as a banker, a merchant, a factor, a broker, an attorney or an agent;
- in his or her professional capacity (other than by way of a trade, profession or business as a banker, a merchant, a factor, a broker, an attorney or an agent);
- in his or her capacity as (i) a director of a corporation, (ii) an officer of an unincorporated association, (iii) a partner in a partnership, or (iv) a key executive of a corporation, an unincorporated association or a partnership; or
- in his or her capacity as a fiduciary.
The amended provision applies to a director of a corporation, officer of an unincorporated association, partner in a partnership, key executive of a corporation, unincorporated association or partnership even though that person did not receive any salary or other remuneration. It also applies to a fiduciary even where it is stated in a contract or an agreement between the parties that a fiduciary relationship does not arise.
The maximum punishment has been reduced from life imprisonment to 20 years’ imprisonment.
Obtaining services fraudulently
A new section 420A creates a new offence of obtaining services fraudulently. It is now an offence to fraudulently or dishonestly obtain a service knowing that it is being made available on a for-payment basis, but not intending that full payment be made. This new offence catches factual situations where the benefit conferred by the victim on the accused person does not fall within the definition of “property” and/or where the “damage or harm” cannot be clearly defined, or where there is no false representation made at the time the services are obtained.
Crimes committed in the virtual arena
The following amendments have also been made to tackle crimes committed in the virtual arena:
- Property: A comprehensive definition of “property” which covers intangible and incorporeal property and virtual currency;
- Valuable security: An extended the definition of “valuable security” to include electronic records; and
- Deception of companies and other entities: Clarification that a company or association or body of persons, whether incorporated or not, is capable of being deceived or induced to act in a certain manner for the purposes of the offence of cheating, even if none of its individual officers, employees or agents is personally deceived or induced to act in such manner.
The Penal Code has been amended to clarify which fact elements must occur in Singapore for the Singapore courts to have jurisdiction over certain offences. To this end, a new Schedule in the Penal Code will specify offences (consisting mainly of important property and white-collar offences) over which the Singapore courts will have jurisdiction provided that:
- an act or omission which is a physical element of the specified offence occurs, whether wholly or partly, in Singapore; or
- the specified offence involved an intention to make a gain or cause a loss or exposure to a risk of loss or cause harm to any person in body, mind, reputation or property, and that gain, loss or harm occurs in Singapore.
The Ministry of Home Affairs (“MHA”) and MinLaw convened the Penal Code Review Committee (“PCRC”) in July 2016 to undertake a review of the Penal Code, and to make recommendations for reform. The PCRC’s report and recommendations were submitted to the Minister for Home Affairs and Minister for Law on 31 August 2018. On 10 September 2018, MHA and MinLaw jointly issued a consultation paper seeking feedback on proposed amendments to the Penal Code.
The Criminal Law Reform Bill (“Bill”) was tabled for first reading in Parliament on 11 February 2019. It was announced by MHA that the Government had considered the PCRC recommendations and agreed with most of the recommendations, and would amend the Penal Code and other legislation to implement them. The Bill was passed on 6 May 2019.
The following materials are available on the Singapore Statutes Online website sso.agc.gov.sg: