betty July 8, 2022

SINGAPORE – A founder and director of collapsed oil trader Zenrock Commodities, and his co-conspirator, were charged in court on Friday (July 8) for offences involving more than US$105 million (S$147 million).

Singaporean Xie Chun, 45, Zenrock’s ex-president and director, and Chinese national Zhang Taiming, 32, its ex-operations executive, were both slapped with four charges: two of cheating, and one each of forgery and criminal breach of trust.

Investigations by the Commercial Affairs Department revealed that sometime between February and March 2020, the duo allegedly used forged documents to deceive the Bank of China’s Singapore branch that Zenrock had contracted to sell a cargo of oil to French oil trader Total Oil Trading.

This induced the bank to issue an irrevocable letter of credit for up to $54 million in favour of Shandong Energy International (Singapore).

Shandong was part of a series of round-tripping contracts, where sales and profits were inflated by selling the same commodity between various parties to create fake trading volume.

Both Xie and Zhang are also alleged to have dishonestly re-assigned to the Bank of China proceeds from a sale of cargo oil that it had charged to HSBC (Singapore) and cheated Credit Agricole Corporate and Investment Bank of US$17 million.

Zenrock was founded here in 2014 by a group of veteran oil traders including Xie, who was formerly from Chinese oil trading giant Unipec.

Xie was offered bail of $500,000 while Zhang was offered bail of $50,000.

Their cases have been adjourned for a pre-trial conference on Aug 17.

If convicted, the men face up to 10 years’ imprisonment and a fine for each of the cheating and forgery charges. The criminal breach of trust charge carries a jail term of up to seven years, a fine, or both.

Zenrock was placed into judicial management in May 2020 with debts of more than US$600 million.

It is one of many high-profile traders to collapse in 2020, alongside Singapore’s Hin Leong Trading, following a crash in oil prices during the Covid-19 pandemic that exposed hidden financial troubles and wrongdoings. Hin Leong founder Lim Oon Kuin, also known an O.K. Lim, faces 130 charges of cheating and forgery.