Major corruption payments to Singapore Ikea manager

by | Feb 8, 2012 | Corruption, Employee Misconduct, Fraud & Integrity | 0 comments

Home | Major corruption payments to Singapore Ikea manager

A Singaporean businessman who paid an incredible SGD $2.4 million to Singapore Ikea’s food services manager over six years has pleaded guilty to 12 counts of corruption involving $761,020. Andrew Tee Fook Boon, owner of business AT35 Services, gave monthly bribes to Mr Chris Leng Kah Poh, then Ikano’s food services manager [Ikano is the local franchisee of Inter Ikea Systems B.V. which operates Ikea in Singapore.

The purpose of the payments was to influence Mr Chris Leng to favour him in placing orders for food products with AT35 and later Food Royale Trading.

Andrew Tee had been operating a scrap metal and waste material disposal business in 2002 when he accepted a business proposition to supply food – mostly raw marinated chicken wings – to Ikea. Yes, those chicken wings consumed by the plateful at Ikea Tampines and Alexandria with plenty of chilli sauce.

Between January 2003 and July 2009,  Tee and his alleged accomplice  Lim Kim Seng had on over 80 separate occasions, given Mr Leng sums of money derived from the profits made by AT and/or Food Royale from the business dealings with Ikea. Following the discovery of the fraud, Mr Tee paid $1 million compensation to Ikano. He could have been fined up to $100,000 and/or jailed for up to five years on each charge.

The fraud case is believed to be one of the biggest amounts involved in a private corruption case in recent years. The corrupt relationship existed from 2003 through to 2009 before being discovered.

Some commentators have questioned how the corrupt relationship was allowed to flourish and continue for such a long period and such large sums were paid to the Ikea manager without being detected.

Possible red flags that could have arisen and, had they been noted by Ikea management at the time, may have led to the corrupt relationship being exposed sooner include:

The Big Spender
The recipient of large corrupt cash payments resort to buying luxury items or else taking expensive holidays [though some chose to pay down debt and keep a low profile]

The Gift Taker
The manager who is willing to accept inappropriate or questionable gifts from suppliers is likely to succumb to corrupt approaches

The Rule Breaker
The recipient of corrupt payments will often take it upon himself to make decisions relating to the contract and payments and seek to exert total control. The recipient will merrily bend or break rules to suit himself or else have subordinates turn a blind eye. Some may involve themselves in areas that are not part of their responsibility and interfere in an attempt to control the contract.

The `Odd Couple’
Corrupt payers and recipients often appear to have friendly relations and meet up socially, though they don’t seem to make a normal fit. The lure of cash and profits outweighs the social awkwardness.

The Explainer
The corrupt receiver will frequently take steps to cover up any failings of the payer’s products or services; the receiver will explain away the poor quality, later delivery or excessive prices as necessary because the payer is `specially qualified’.

The Needy One
The corrupt receiver may have financial pressures resulting from gambling, substance abuse, debt problems or else family pressures. Observing these pressures may help pre-empt them and take away the need for corrupt payments.

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