The Arcade Goes To Court To Recover Missing $4.8m

Source : The Straits Times, Aug 7, 2007

Building's manager has vanished and is said to have pocketed the money By K.C. Vijayan, Law Correspondent.

FOR more than 11 years, the manager of The Arcade received cheques to the tune of nearly $5 million. That sum, said to have gone to his own company, is now missing.

Missing too, since October 2005, is Mr Wilson Loh, building services manager of the 20-storey office-cum-commercial complex in Raffles Place.

It is believed $4.76 million disappeared as a result of 102 cheques made out to Mr Loh's own private firm, Wilkins Enterprise, for goods and services that were not delivered.

The alleged fraud was spread over 11 years, from 1994 to 2005.

Now, The Arcade's management corporation is taking the present managing agent - DTZ Debenham Tie Leung (SEA), and its subsidiary - to court to recover its missing $4.76 million. A High Court pre-trial conference on the civil suit is due to be held next week.

Mr Loh became building supervisor in 1991, when DTZ Leung Pte Ltd was The Arcade's managing agent until March 1997. He kept his job when in April 1997, a subsidiary - DTZ Debenham Tie Leung Property Management Services - took over as managing agent.

It was DTZ that discovered Mr Loh's alleged misdeeds on Oct 3, 2005, after a cheque bounced.

By then, Mr Loh had gone missing.

DTZ contacted the police. It also sent a notice to all subsidiary proprietors explaining the situation and assuring them The Arcade would continue to run as before.

In a statement yesterday, it said it had then provided an emergency float of $100,000 to ensure services could continue.

As building supervisor, Mr Loh handled all administration work involving building maintenance. He dealt with contractors and made recommendations for payment.

He also produced monthly account statements for The Arcade's managing council and annual audits.

The warning bells first sounded in September 2005, when a cheque for some $524,000 from The Arcade to its engineering sub-contractor bounced. A computer hard disk from Mr Loh's Arcade office was later found to be missing. So were some files.

It is believed there were two sets of accounts, at least from 1997 to 2004. The second fraudulent set, purported audited, and shown to The Arcade's management in 2004, had a sum of $2.75 million. In fact, only $45,305 was left by then, according to court documents filed.

Police have also been investigating the alleged frauds. Police spokesman Mohamed Razif confirmed a report had been received but deemed it 'inappropriate to comment as investigations are ongoing'.

DTZ, through its lawyers from Allen & Gledhill, disputes The Arcade's claims. It is expected to argue that as Mr Loh reported to the chairman and council members of The Arcade's management council, they had full control and supervision over him.

The Arcade, through its lawyers from Harry Elias Partnership, is expected to argue that Mr Loh lied to The Arcade's management to induce it to make out cheques payable to his firm, Wilkins Enterprise.

The Arcade is also seeking damages for expenses incurred in redressing the loss, including legal costs, engaging forensic audit consultants to uncover the alleged frauds, and having to seek a loan to fund its operations after the $4.76 million loss.

Wilkins Enterprise, which operated from International Plaza in Anson Road, is now defunct. Mr Loh was made a bankrupt in February.

A DTZ statement said it could not comment further on the case as it is now the subject of legal proceedings.

It said: 'We understand that the loss arising from the case, if any, will be covered by insurance. Our operations will not be affected in any way.'