The billion-dollar investment scam shocked Singapore

 The billion-dollar investment scam shocked Singapore

When Covid-19 broke out in Singapore, rumors began to appear among the rich in this country about a fund manager paying profits up to 60% per year.

Rumors then began to spread. More and more Singaporeans are pouring money to Ng Yu Zhi, a 34-year-old former accountant, to buy and sell nickel. This is the key metal in rechargeable batteries that Tesla's Elon Musk once asked suppliers to "please mine more".

Not long after, Envy Group - Ng's fund - raised nearly 1.5 billion Singapore dollars ($1.1 billion) from hundreds of customers. He also pays quarterly interest, looks very successful, lives in a mansion in one of the most expensive areas in Asia, has a yacht and a fleet of supercars.

Then suddenly, in February 2021, the Singapore police arrested Ng, accusing him of operating the largest fraud ring in the history of this island nation. According to police and accountants investigating Ng's books, the transactions he announced never happened. Instead, they said Ng had transferred S$475 million of investor funds to a personal account, to cater for a lavish lifestyle. Ng declined to comment on the case, saying police were still investigating. He currently faces 75 charges against him.

Ng Yu Zhi - who is accused of defrauding investors in Singapore. Photo: Bloomberg

Ng Yu Zhi - who is accused of defrauding investors in Singapore. Photo: Bloomberg

Ng's clients include Singapore's most successful citizens, from lawyers, former bankers to businessmen. According to legal documents, Ng made more than a thousand wire transfers from Envy's account to bank accounts he may have controlled.

Scams are not uncommon in the world. Super con artist Bernie Madoff also ran a fraud ring for decades, bypassing investors and authorities. Even so, the allegation against Ng is still surprising in Singapore. With stable politics, open borders and a tight legal system, the city is on track to replace Hong Kong as the Asian financial hub. However, Singapore has also recently seen many major scandals, such as the collapse of Noble Group - a commodity trading company accused of falsifying its books, and the data fraud at water treatment company Hyflux that caused many investors angry investment.

For some, Ng's case shows that authorities need to more closely monitor investment cash flows. "In the case of Envy, there were a lot of unusual signs of fraud. So where were the authorities?" said Mak Yuen Teen, Lecturer in Accounting at the University of Singapore Business School.

Ng has a soft voice, polite, round face. He studied accounting in Singapore, then worked for the auditing firm KPMG. One of the main clients Ng works with is BHP Group - the world's largest mining group. Ng was then intrigued by the metals industry, with its huge market, high liquidity, real demand in the industry, and 24/7 volatility. He then started trading in commodities, and left KPMG in 2015 to focus on developing this new passion.

Ng's opening of the company was also very coincidental. Global commodity prices have nearly halved from their 2008 peak, opening huge profits for those who dare to venture and have capital. Besides, few places are more favorable for this activity than Singapore. As a busy financial hub, the island nation not only attracts investment from Southeast Asia, but also from India, China and many other countries. Everyone wants to share in the fruits of Singapore's success.

Ng founded Envy Group in 2015, focusing on nickel. This industry is dominated by large companies with a wide network of relationships. Therefore, building a company from zero is quite difficult. However, Ng sees nickel as undervalued, as the market fails to appreciate its potential for use.

The business is therefore very good, if judged from the outside. Nickel prices continuously increased in the second half of the last decade. Ng also gradually expanded the list of customers.

In a place used to glitz like Singapore, Ng still stands out. His office is luxe, with a bar where visitors can enjoy a glass of 21-year-old Hibiki whiskey. Ng enjoys meeting clients and colleagues at top sushi bars, traveling in multi-million dollar supercars, such as Ferrari, Lamborghini and Pagani Huayra.

His house is of course equally luxurious. Ng and his Chinese-born wife Coco Cai rent a villa and plan to buy two others. The pandemic has not affected their lifestyles either. In December 2020, Cai once told Prestige magazine that a group of sales staff from Bulgari jewelry company went to Cai's house to introduce a new collection just for her.

Ng doesn't advertise much. However, news of the huge profits he returned to investors spread everywhere, from birthday parties to golf courses. More and more Singapore's elites trust Ng. It's Pek Siok Lan of Singapore National Investment Company