A wealthy Chinese businessman has accused former employees of his Singapore-based family office of misappropriating millions, adding to concerns about the city-state’s wealth management sector following a major money laundering case.
Zhong Renhai, an ultra-high-net-worth individual, alleged that staff at his Panda Enterprise family office and affiliated firm Lee Fung International (LFI) siphoned off 74 million Singapore dollars ($55.5 million), according to a ruling from Singapore’s High Court.
The court issued a global asset freeze order against four former LFI employees—believed to be Singaporeans—and a British Virgin Islands entity under their control. The judge stated that the claimants presented a “good arguable case” for the fraud allegations.
Zhong discovered the misconduct in December 2023, leading to the employees’ dismissal by early 2024. A forensic audit later confirmed the missing funds. Among the fraudulent activities, three ex-employees allegedly took excessive salaries from 2019 to 2022, overpaying themselves by SG$2.93 million, SG$2.67 million, and SG$2.76 million, respectively. Additionally, one of the accused reportedly forged documents to divert $25 million through an offshore company.
The defendants contested the claims, arguing one of them had authority over pay and bonuses, but the court rejected their request to lift the asset freeze, citing no abuse of process by Zhong.
The scandal underscores growing scrutiny of Singapore’s family office sector, which has surged past 2,000 entities as of late 2024. Concerns over financial oversight intensified after a SG$3 billion money laundering case involving 10 Chinese nationals, some of whom used family office structures for illicit transactions.
Singapore’s Monetary Authority has since increased regulatory scrutiny, requiring more stringent background checks and mandating that family offices hold accounts with MAS-regulated banks. Some experts warn that family offices, operating outside the licensing framework required for traditional financial institutions, remain vulnerable to insider misconduct.
“You can’t have 100% enforcement,” said Loh Kia Meng, a senior partner at Dentons Rodyk. “Every system has gaps, and people will exploit them.”
