Sunshine Empire founder charged with illegal deposits taking

KUALA LUMPUR: One of the biggest financial scams in corporate Singapore’s history has come under the limelight again when the founder of multi-level marketing company Sunshine Empire Sdn Bhd was charged at the Kuala Lumpur Sessions Court today, immediately after serving his jail sentence in Singapore on Wednesday.
James Phang Wah, 58, was sentenced to nine years' jail in Singapore in July 2010 and fined S$60,000 for running a fraudulent investment scheme.
In Kuala Lumpur today, Phang claimed trial to assisting with the management of Sunshine Empire, which did not possess a valid licence for deposits-taking activity.
The Singapore national was charged with two counts of illegal deposits taking at two places between July 14, 2006 and Oct 17, 2006 as well as between Oct 18, 2006 and April 4, 2008.
Each charge, under Section 25(1) and Section 106(1) of the Banking and Financial Institutions Act 1989, provides for a fine of up to RM10 million or imprisonment for up to 10 years, or both.
Sessions Court judge Hasbullah Adam set bail at RM2 million with two sureties for the two charges. Phang was ordered to surrender his document of identity, which was issued in lieu of his passport that had expired on July 23, 2015.
Hasbullah directed the accused to report to the nearest police station once a month.
The court fixed Jan 26, 2018 for mention. The accused declined to speak to the media.
Sunshine Empire itself is no stranger to Malaysians as it was charged with the same offence here on March 13, 2009 and fined RM2 million after pleading guilty on June 3, 2010 for accepting deposits from the public without a valid licence.
Promising huge returns via its “lifestyle packages”, Sunshine Empire attracted a huge number of investors from Singapore and Malaysia between August 2006 and November 2007.
During that period, close to 26,000 packages were sold by Sunshine Empire, according to court papers in Singapore. It is unknown how many Malaysians were involved in the investment scheme.
Prosecuting officer Alvin Ong Heng Kiat believes the scheme involved a total deposit sum of RM230 million, of which over RM20 million was forfeited by the High Court in 2013 under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.
Phang, who grew up in a vegetable farm in Singapore, had likened himself to Warren Buffet and claimed that his investment philosophy to be even better than Buffet’s.
Phang started off with a multi-level marketing firm – Number One Product, which was involved in the magnetic mattresses business in 1990. This was followed by Empire Group Alliance in 2003, which Sunshine Empire was part of. Empire Group Alliance was involved in many different business segments.
At this point, Phang’s so-called revolutionary business model was conceptualised, whereby consumer rebate privileges were introduced for its merchants in the form of monthly cash payouts for thousands of items. The returns paid out were generated from new investors instead of from actual profits from the business.
Reports out of Singapore had stated that authorities recovered S$21 million from the S$190 million siphoned off.