Criminal Law Reform Bill passed in Parliament to reform Penal Code in various areas including white-collar crime

29 May 2019

On 6 May 2019, the Criminal Law Reform Bill (“Bill”) was passed in Parliament. Among other things, the Bill introduces amendments to the Penal Code to ensure it remains relevant and up to date. Most of the provisions are expected to come into force in early 2020.

This article will highlight provisions in the Bill which are relevant to the area of white-collar crime.

New fraud offence

The Bill introduces a new offence of fraud, adapted from the UK Fraud Act 2006. This new offence 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.

Two variants of the fraud offence will be introduced. The first category covers fraud directly in connection with written or oral contracts for goods and services. The second category covers other types of fraud, and is expected to come into force first, with the rest of the Penal Code amendments. In respect of the first category, Mr Amrin Amin, Senior Parliamentary Secretary, Ministry of Home Affairs and Ministry of Health expressed that a mechanism allowing private persons to obtain recourse for more common cases involving smaller losses is being developed, and such mechanism could involve private prosecutions, civil claims and other avenues.

Both variants of the fraud offence are punishable with imprisonment for a term which may extend to 20 years, or with fine, or with both.

Criminal breach of trust

Section 409 of the Penal Code sets 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 [2018] 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.

Under the Bill, section 409 will be amended to apply the enhanced punishment 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 will apply 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 will also apply to a fiduciary even though it is stated in a contract or an agreement between the parties that a fiduciary relationship does not arise.

The maximum punishment will also be reduced from life imprisonment to 20 years’ imprisonment.

Obtaining services fraudulently

The Bill also introduces a new offence of obtaining services fraudulently. Under the Bill, it will be 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 will catch 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 Bill contains the following provisions to tackle crimes committed in the virtual arena: 

  • Property: Setting out a comprehensive definition of “property” which will cover intangible and incorporeal property and virtual currency; 
  • Valuable security: Extending the definition of “valuable security” to include electronic records; and 
  • Deception of companies and other entities: Clarifying 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.

Transnational offences

The Bill clarifies 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:

  • 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.

Background

The Ministry of Home Affairs (“MHA”) and the Ministry of Law (“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 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.

Reference materials

The following materials are available on the Parliament website www.parliament.gov.sg and MHA website www.mha.gov.sg:

 

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