Friday, June 28, 2013

A Question Of Libel

Whatever keeps Law Minister K. Shanmugam up at night, it wasn't The Global Mail (TGM) piece by Eric Ellis. At least not long enough to make midnight calls, or so he claims. But Shanmugam did write that he discussed the article with a friend, and "I agreed and told him that the article was libellious - both of us as lawyers agreed on that point". So what does a libellious article read like?
When you are Singapore’s Lee family, and your clan has exercised absolute and uninterrupted control over its swanky specklet of Asia for 54 years, fellows like Kasiviswanathan Shanmugam are handy to have within your power court.

K. Shanmugam, as he’s less tongue-twistingly known, may have escaped the attention of those unfamiliar with the cosy connections that hold Singapore’s power elite together — a warm, clubby embrace that has kept them very wealthy. But 54-year-old Shanmugam is a bigwig on the tiny island, which is currently being suffocated by pollution from the periodic burning of millions of hectares of palm oil plantations that have trashed the equatorial habitat of neighbouring Indonesia. That pollution from the illegal fire-clearing of these plantations has swept on eastward winds from Sumatra in massive clouds of smoke and ash to shroud and choke Singapore, southern Malaysia and large tracts of western Indonesia.

Call it blowback. Many of these plantations are owned by people with intimate connections to that same power court in Singapore, who helpfully provide them all manner of metropolitan usefulness, banking their billions and domiciling their empires while discreetly looking past, er, indiscretions that may have been perpetrated elsewhere. Many of these plantations are owned by people with intimate connections to that same power court in Singapore, who helpfully provide them all manner of metropolitan usefulness, banking their billions and domiciling their empires.

Singapore has 101,000 millionaires officially resident on the island, their assets tucked safely away in the nation’s banks, property and share markets. Plenty of these plutocrats are normal Singaporeans who’ve done well in business. But many are not, like corrupt Indonesians on the run, or Burmese generals seeking safe haven. Singapore’s plutocratic ranks have been swelled in recent years by Europeans and Russians seeking relief from tax and the prying regulators of home, these exiles spending just enough time and money in Singapore to qualify for residency. This, to many, is the useful point of Singapore, where Shanmugam – born in 1959, the very year Lee family patriarch Lee Kuan Yew began his three decades as ruler – has been an MP since 1988 for the Lees’ ruling People’s Action Party (PAP).

Shanmugam’s story, and there are many like it in Singapore’s political circles, neatly illustrates how power flows in Singapore, via an apparatus ironically made more visible by the haze crisis.
There have been five parliamentary elections since then in Singapore’s almost-democracy, three of them relatively leisurely affairs for Shanmugam; he and his PAP friends were untroubled by any other candidates in their constituency, Sembawang, an area perhaps best known for its US naval facility. But Shanmugam’s selfless devotion to public service – Singapore MPs receive a basic annual allowance of around US$200,000 – hasn’t hindered an even more lucrative career, in law and business. He’s one of Singapore’s most formidable litigators, a leader of the army of Lee-loyalist lawyers who’ve helped win their legal system a contentious reputation as a jurisdiction, most notably in defamation.

Singapore is one of the world’s libel capitals, and its litigants – many have been colleagues of Shanmugam, leaders of the ruling PAP – have won record-setting damages for defamation by their political rivals and the international media. What would pass as the normal buffeting of election debate in most genuinely pluralist democracies has been, in Singapore, a device of oppression. Here, sensitive politicians and officials, famously led by the Lees themselves, have shown an enthusiastic inclination to sue opponents into penurious legal submission. Singaporean officials, it’s often said, can imagine libel and slander in a harsh glare.

All of which helps explain why MPs like Shanmugam don’t always encounter combatants when they run for election. Indeed, this absence of opposition has meant that there’s only been three parliamentary elections in Singapore in the five since 1988 in which the PAP wasn’t returned to office on nomination day – the actual poll being largely irrelevant as to decide who runs the country.

Shanmugam doesn’t mind highlighting such powerful connections in his sparkling official CV, now for the Nee Soon electorate in Singapore. This biography describes a storied student who became a ‘star litigator’ for Singapore’s biggest law firm, a lawyer who has represented prime ministers past and present. And, busy man, Shanmugam has also served on some illustrious boards while being MP and lawyer-at-large, his biography reveals. For example, he’s held a long and lucrative directorship at one of Singapore’s state-controlled blue chips, Sembcorp (a post he shared with strongman Lee Kuan Yew’s daughter-in-law Lee Suet Fern, whose husband ran Singapore Telecommunications for 12 years), and another on Singapore’s state media regulator, among other establishment posts. Now Shanmugam has been Singapore’s Foreign Minister since 2011, and Minister for Law since 2008, his official salary now somewhere north of $US1 million. He’s the senior official entrusted by his Prime Minister, Lee Kuan Yew’s son Lee Hsien Loong, to go after the polluters they believe are responsible for the life-threatening haze, now too thick to ignore, which has engulfed their region.

“If any Singapore companies are involved,” thundered PM Lee last week, “or companies which are present in Singapore are involved, we will take it up with them." Indeed, Jakarta has helpfully identified as many as 14 companies it believes responsible for the muck, while reminding Singapore that many more Indonesians are suffering its effects than inhabitants of the look-at-me island nation. Two of the companies fingered by Indonesia are its Widjaja family’s Sinar Mas Agro Resources and Technology (SMART), which has long been a target of environmentalists, and Asia Pacific Resources International (APRIL), controlled by the Indonesian-born Singaporean tycoon Sukanto Tanoto. Both are based in Singapore, where SMART’s parent company is the locally listed Golden Agri-Resources. And this is where Lee’s Foreign and Law Minister K. Shanmugam comes in again. Two of the directorships that don’t appear in Shanmugam’s glittering CV are his former stints as a director of Golden Agri-Resources and Asia Food and Property Ltd. Both are Singaporean companies controlled by Indonesia’s controversial Widjaja family. In the early 2000s, while Shanmugam was on these boards, the Widjajas had the dubious honour of owning the notorious Asia Pulp and Paper, which would come to be responsible for the biggest bond default in corporate Asian history. What transpired at APP was a US$13 billion fiasco, a scandal largely unearthed by the pesky foreign media, and which exposed Singapore as something other than the squeaky-clean financial centre its government likes to internationally promote itself as. Transferring public company funds through a murky family-controlled bank in the tax haven of the Cook Islands was a sleight of hand much favoured by the Widjajas.

No-one involved with the APP scandal was ever prosecuted or brought to legal book anywhere. Those foolish enough to have invested with the Widjajas absorbed huge hits. Most of APP’s debts were effectively written off and, like so many dodgy Indonesians and Singaporeans of that era, the Widjajas regrouped to do business another day – to pollute again.

As for Shanmugam, after firing off a few threatening legal salvos at the time to anyone who too publicly mentioned his connection to the Widjajas, he later resigned his directorships and resumed his legal and political career. The Global Mail isn’t suggesting that Shanmugam was in any way party to the financial scandal that then engulfed the Widjaja empire. Indeed, all reports at the time suggested he was embarrassed by his links to the Widjajas. Nor are we saying that he is involved in the haze outrage that now engulfs them. And, despite being identified by Jakarta as a polluter, Golden Agri insists “there are no hotspots or fires” at its Sumatran plantations.

Should this assertion of innocence be proved wrong, Shanmugam, now as a minister, would at least know who to call when asked to bring miscreants to book; that is, if he doesn’t first recuse himself from official involvement given his one-time close links to the controversial Widjajas. But that doesn’t seem likely. Last weekend, Shanmugam reportedly joined his PM and other government colleagues in handing out some of the million-odd facemasks Singapore has bought to distribute to low-income Singaporeans affected by the haze.

TGM emailed Mr Shanmugam a series of questions about his former links to the Widjaja’s Golden Agri but did not receive a response.

Singapore’s respiratory crisis has also shone a spotlight on some other local companies with interests in the controversial palm oil sector. One of them is particularly close to PM Lee, at the core Singapore’s politics-meets-business power apparatus: Temasek Holdings, Singapore’s influential state-owned investment company, which controls companies such as Singapore Telecom, Singapore Airlines and Australia’s Optus, also holds big stakes in myriad international businesses. One of those investments is in CTP Holdings, Temasek’s Singapore-based joint venture with the US agricultural group Cargill. CTP operates oil-palm plantations in Indonesia. Last week, CTP was quick to say its holdings are well away from the current hotspots that have so polluted the Singapore environs. In any event, CTP’s backers claim their plantations operate a strict no-burn policy, and Temasek and Cargill have been keen to distance CTP and themselves from any environmental outrage. Which is not how the US environmental lobby Rain Forest Network sees CTP’s operations in Indonesia’s Kalimantan region, to Singapore’s east; the group accuses CTP of clearing rainforest without permits, destroying watersheds and burning forests.

That Temasek was moved to publish a press release on the palm oil crisis at this time is itself instructive. It speaks to the rising opposition to Singapore’s Lee-led establishment, which revealed itself most eloquently in the last parliamentary and presidential elections, in 2011, in which the opposition not only fielded a record complement of candidates but made genuine gains against the PAP-dominated system. Amidst the tumult from Tahrir Square and the tragedy of Syria, this ‘Singapore Spring’ hasn’t registered internationally with quite the impact of the Arab prototype that inspired it. But to the 5.3 million Singaporeans now coughing through yet another haze outrage blown in from Indonesia, their spring has arrived in the increasing accountability they demand of Singapore’s once impervious courtiers in running national affairs. In a town where ‘normal’ political activity is deemed off limits, Temasek’s management has been a proxy political tool the opposition can fulminate about – Temasek as the symbolic vehicle of PAP patronage and performance.

Temasek and its likewise state-owned sister fund, the Singapore Government Investment Corporation, officially invest Singaporeans’ money. Like the more transparent sovereign wealth funds of democratic Norway and East Timor, and those more opaque in the Gulf monarchies, these two companies are national nest eggs owned by all Singaporeans, and in which every Singaporean notionally has a say. Temasek, which by some measures has an interest in as much as 60 per cent of the Singaporean economy, has been run by PM Lee’s wife, Ho Ching, since 2003. And her patchy investment record would likely have seen her removed, had she performed similarly in any Western company. That record has increasingly been the subject of rational analysis, by academics and aspiring Singaporean politicians such as Kenneth Jeyaretnam, who would like to see these funds broken up and privatised. Such transparency has been refreshing for Singaporeans, but other things don’t change. It remains out of bounds in Singapore to debate if Madame Ho got – and kept – her job because she’s a member of the Lee family. The last voice to publicly do this was a well-followed local blog, the Temasek Review Emeritus, which was swiftly threatened by one of the Lees’ notorious legal onslaughts en route to being forced into a grovelling apology. Today, it’s a rare Western media outlet – those with corporate interests or circulation in Singapore are particularly reticent – that will examine the Temasek record as they might similarly influential corporations elsewhere, such as Apple, Shell or BHP Billiton.

For media reporting on Temasek’s activities, official Singapore has insisted that it be accurate in its facts, and that it refer to Temasek as an “Asian investment company”. For good measure, Temasek would also prefer that any reference to Madame Ho as the PM’s wife be expunged. Singapore’s pliant media does what its told but foreign press is less observant of local sensitivities. But the media, indeed anyone with cause to analyses Temasek, such as credit rating agencies and banks, can’t fulfill the latter requirements without noting the former. Accuracy and investment decisions demand that Temasek be properly identified as being owned by the Singapore government. And there’s no avoiding the fact that Madame Ho, who often very publicly travels with her husband on state tours abroad, is Mrs Lee, a very powerful and wealthy Mrs Lee, if not always a particularly astute investor of her compatriots’ nest egg.

For all the putridness that the clouds now defiling Singapore and beyond are depositing, they may yet come with a silver lining, of more transparency for one Asia’s most rigid societies.

So will TGM be dragged to court, or will it simply apply for a license to write about Singapore news and post a $50,000 performance bond? The suspense is killing us.


  1. The facts of the situation are clear. The minister was a director for some years in companies ultimately owned and controlled by Indonesia's controversial Widjaja family over a 4 years period from 1997-2001.

    However, it remains a serious & legit question to ask.

    That now in his role as Foreign and Law minister who has oversight of a process that may lead to prosecution in Singapore of companies owned by the same family for illegal land clearance in Indonesia presents a possible conflict of interest. And in that light it is therefore curious that he asked Singaporeans, what else can be done when news of the haze first broke.

    In fact, is it appropriate for him to be involved in the diplomatic effort with Indonesia? Since he has (he admits so), received directorship payments for work done for companies linked to those that are currently implicated in the haze crisis. And if the said company is evidenced to be involved, would he have the resolve to bring the Widjaja family to account regardless of past relationships? Singaporeans who wants the polluting culprits to be nabbed have the rights to know.

    1. Mr Shan appears more concerned whether or not certain words in the article or actions on facebook may be "actionable". Is he forgetting about the real and bigger fish to fry?

  2. 1. The media has asked me questions on my past directorships in Asia Food & Properties Ltd (“AFP”) and Golden Agri-Resources Ltd (“GAR”) (controlled by the Sinar Mas Group, “SMG”). These questions have been raised because one senior Indonesian official had said last week, that SMG, (which has some companies in Singapore), was among those who were burning in Indonesia, and causing the haze.

    2. There are two aspects to consider:-

    (1) are companies in Singapore involved in the burning in Indonesia?; and

    (2) the facts relating to my past directorships in AFP and GAR.

    I. Are companies in Singapore involved in the burning?

    3. Senior Indonesian officials have issued contradictory statements on this point. One senior official said last week that Singapore linked companies were involved in the burning. But two other senior Indonesian officials have contradicted him and said that there was no basis for saying this. Indonesia has acknowledged that its officials have been contradicting each other on this point, and that what is needed is a proper investigation. SMG, as well as other companies, have also denied the allegations. SMG has invited observers to visit its plantations to see for themselves the situation on the ground.

    4. Singapore has formally asked Indonesia, through a Diplomatic Note, for evidence of any Singapore linked company involvement in the burning. If and when such evidence is received, it will be handed over to the Attorney General to consider what action can be taken.

    II. My past directorships in AFP and GAR

    5. In June 1996, the SGX asked me and two others (Mr Wong Kok Siew and Mr Ho Tian Yee) to become independent directors, of a listed company called Amcol, because Amcol was in serious trouble. Most of Amcol’s then directors were told to step down. Amcol had over 11,000 shareholders, many of them Singaporeans who had invested using their CPF. The three of us were asked to go in and see how the investing public shareholders of Amcol could be helped. Price Waterhouse valued each Amcol share at 1 cent and Amcol went into Judicial Management (“JM”).

    6. We handled the affairs of Amcol, together with the JMs. A white knight, SMG, was eventually found for Amcol. SMG took over Amcol in 1997, using AFP.

    7. AFP was then listed, and I became a director of AFP. Based on the listing price, the original Amcol shareholders who had kept their shares got a substantial benefit – as opposed to Amcol going bankrupt and being wound up. I did not charge or receive any fees for this work – the work was done to help the public, who were Amcol shareholders.

    8. GAR was listed in 1999 as a subsidiary of AFP and I was appointed a director of GAR.

    9. When AFP was listed in 1997, I wanted to step down, as the work SGX had asked me to do, (to help Amcol shareholders), was completed. However, SMG asked me to stay on for a period, to give confidence to shareholders, given that the company had gone through difficult times. I agreed to SMG’s request.

    10. In 2001, I stepped down from both the AFP and GAR Boards, as the transition was over and SMG had found new directors.

    11. Throughout this period, I did not own any shares in Amcol, AFP or GAR. I did my duty on behalf of shareholders as requested by SGX. And I have never owned any shares in any of these companies. As director of AFP and GAR, I received director’s fees, similar to other directors.

    12. I have also been asked about APP Ltd. APP was listed in the NYSE. I had no dealings whatsoever with APP.

    K. Shanmugam
    28 Jun 2013


    1. Isn't it strange that anyone would want to be a director of a company in "serious" trouble? What happens if the company turns out to be involved in more shady business than mismanaged finances?
      What do the directors bring to the table? Does the company become more credible when one of it's directors happens to be an MP, a minister of state or full minister? Is that why nobody asked questions about A.I.M. when it struck the shady deal with the PAP town councils? Looks like a Pandora's box is being opened.

    2. It is extremely rare for lawyers, to lend their names in endeavours without first assessing: " whats in it for me? "
      They are far too careful, kiasu & kiasi.

      To top it all, pro bono?

      Fame, fortune or just a noble act of charity?

    3. //As director of AFP and GAR, I received director’s fees, similar to other directors//
      There, in his own words, he took the pieces of silver.


  3. Haha....

    There are too much sin in Sin?

    1. Too much sin, sham, sue.

  4. Sham might have done SGX a "free service" in 1996 Amcol (another Indonesian den of corrupt money laundering businesses who came and screw local shareholders with full blessing of leeders) bankruptcy, but he had very "sweet" commercial reasons to suck up to Sinar Mas and Asia Food and property in 1997, and worse, he even joint Golden Agri as dierctor in 1999, long after Amcol was history. This is because while he might not have received fees for Amcol, he was definitely richly rewarded by Sinar Mas in AFP, GAR and APP by bringing in fees for his law firm Allen & Gledhill since then. I say "worse" above because APP or Asia Pulp and Paper was by 1999 one of the dirtiest linen in the world of Asian corporate bond market, having defaulted while the Widjaja family openly moved cash from various APP controlled entities into their own bank (BII its various branches in Cayman Island etc moeny laundering centres) while investors who bought APP bonds under NY (and probably Singapore) law, were dragged into a kangaroo court in Jakarat and after that in NY. Investors include Goldman, Citi, Oaktree, UBS, etc. Even before the final "reschedule" was settled, the widjaja used the cash it pocketed from APP's coffers to buy back huge amounts of APP debt which were trading at a few cents on the dollar! And while all these hanky panky monkey businesses were taking place, your great Sham agreed to join the BoD of yet another Sinar money sucking machine called Golden Agri (another Li Ka Shing type of multi-level listing with no real operating assets), and surprisingly the SGX geedily agreed to allow another Sinar Mas listing to sucker in more investors' money. If it weren't local investors money and the greed of the influential folks behind the "authorities", all this would almost be a great materiel for a book on Ponzi scams and greedy (and surprisingly naive) leeders.


      Yes. Most probably quite similar to the concept along the line of "Because AIM is backed by PAP, even a $2 shell company is credible". I am sure Sinar Mars has reaped handsomely from those public listing and bond raising exercises. He lending the name to the group as a paying and seating Director has possibly led to their run-away success. Unless one is naive enough to think the white knight would willingly be happy to rescue those 11,000 CPF investors for nothing in return, they should really ask again, why would any businessman be a sucker for a loss making business that is worth 1 cent?

      Just like the smoke and fire that burnt down the house, no fire-starters were apprehended. So when he said on TV that he's very supportive of Indonesian President enforcing the law in his land, are we to interpret that the same Indo company with SG-based presence in Singapore will get away? So anyone who can trust the Indons to come up with credible evidence and punishing the big boys, please kee chiu?

  5. If the Minister wants to sue anyone who will republish it, then he should just say so directly on his facebook, or even better, just go after the journalist in Australia. I find it strange that after Remy Choo has admitted that he was the one who unfortunately "conveyed" that misleading message to Kirsten, that the Mr Shan still has the audacity to say it on CNA to imply that people don't always check their facts before posting online, thus trying to discredit Ms Han here. What is his hidden agenda here?

    So to those IB who are quick to threaten everybody with "don't share this article or you will be sued/receive a midnight call from Mr Shan", I say back off with your fear mongering tactics. IF anyone has issue with sharing/forwarding free information, they should go sue Facebook or Twitter for having built this features/functionality on their platform. You don't get to tell people what are the right things to read, what they can share/forward on their personal account. You want to throw your weight against Yahoo or TGM, just pull your sword at them openly. Go on! But there's no need to threaten the internet community.

  6. So is Yahoo peeing in their pants worrying about republishing it or their $50,000 bond will be forfeited huh?

  7. Remy Choo Zheng Xi, co-founder of The Online Citizen, has admitted that he was responsible for giving the erroneous impression given to Kirsten Han that Shanmugam would not hesitate to sue those republishing the Global Mail article, and that it was incorrect and unfair of him to have done so. Can this confession be used against Remy Choo in a court of law, and will the police arrest him for defamation of a public figure?

  8. As far as I, a simple layman is concerned, as long as there is no actual confirmation that detailedly announced that the said article is indeed libelous, I will share and forward any article (just like I read a CNN or FT or Reuters) I deem interesting with my friends, on whatever platform I use. It is not up to any one to tell me what I share or read based on a "supposedly" second hand information told from a Big lawyer to a small lawyer on a private phone call. I was not privy to that conversation and its contents, therefore I am not aware that this is a potentially libelous article. The word is 'potential'...not definitive, not actionable, no double-confirm yet , as far as we the laymen are concerned. Until then, we have every right to read or share what we want on the internet. If Mr Shanmugam thinks he can do such a good job of regulating the internet democracy, he should go apply for a job with NSA.
    They will welcome talent like him.

  9. ////The government is dependant on foreign workers and a healthy and vibrant property market to survive...both inter-connected

    The people however want me me first..especially jobs though they are less capable. .... and. .. cheap cheap cheap. ..especially housing. .. cars

    Like that. .. government people how to afford living like Kings and princes..hhaaahhaaa/////

    Why decades ago during the 70's-80's can, now cannot ??? Ask those uncle/aunties, what's the difference between living in the early years than now. The answer is : during the earlier years, we has smart and productive people, including the leaders. But now we've idiotic daft, incompetent complacent goondus blokes, foreign trash and leaders.

    PS - The Gen-Y of today including the leaders, are blind. So to speak, the blind leading the blind, bloke !!!

    30/6/13 21:49
    Anonymous Anonymous said...

    Hope that Singapore are prepare for the type of SARS that causes serious damage to Hong Kong because of overcrowding and overpopulation left many staying in cages, 100K still waiting for the rental flats.

    At that time, fortunately they govt intervene to buy many stocks to push up the market if not Hong Kong will be in serious trouble and during the serious recession, ask the China govt to let its people to tour Hong Kong to push up the economy?

    A smaller population is easier to handle but a huge population is much harder?

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