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The Singapore High Court recently clarified sentencing guidelines for private sector corruption offences under sections 6(a) and 6(b) of the Prevention of Corruption Act 1960 (PCA)

In brief

In the recent decision of Goh Ngak Eng v Public Prosecutor [2022] SGHC 254, the Singapore High Court (HC) declined to employ the existing sentencing framework for private sector corruption offences involving agents under section 6 of the PCA as set out in Takaaki Masui v. Public Prosecutor and another appeal and other matters [2021] 4 SLR 160 (“Masui“).

Section 6 of the PCA criminalises the actions of agents (e.g., employees, those who act on behalf of others and public servants) who corruptly receive or give gratification as an inducement or reward for performing or withholding performance in relation to their principal’s affairs or business.

In developing a new framework, the HC cautioned that the sentencing exercise is not meant to be seen as a mathematical equation; sentencing frameworks are only meant to serve as guides and should not be used to produce a mathematically precise formula that identifies a precise point for the sentencing court to arrive at in each case.


Contents

  1. Key takeaways
  2. Background facts
  3. Development of a new sentencing framework for private sector corruption offences
  4. Non-applicability of Revised Framework to section 5 of the PCA
  5. Non-applicability of the Revised Framework to public sector corruption
  6. Conclusion

Key takeaways

  • The new sentencing framework for private sector corruption offenses under sections 6(a) and 6(b) of the PCA is modeled after the two-stage, five-step framework in Logachev Vladislav v. Public Prosecutor [2018] 4 SLR 609 (“Logachev“) (“Revised Framework“).
  • The Revised Framework is not applicable to section 5 of the PCA given that section 5 and section 6 of the PCA are intended to target different kinds of mischiefs. In particular, the HC observed that while section 5 of the PCA targets corrupt transactions more generally, section 6 of the PCA is specifically directed at a situation where an agent subordinates the loyalty owed to his principal for his own interests.
  • The Revised Framework is also not applicable to public sector corruption under sections 6(a) and 6(b) of the PCA. This stems from the distinct overarching considerations between the prevention of public and private sector corruption.
  • Given Singapore’s unwavering stance against corruption, companies operating in Singapore should seek to employ robust anti-corruption policies and programs. These could include clear written guidelines on the receipt and provision of gifts, a developed whistleblowing platform, and regular audits to ensure that transactions are executed legally and ethically.

Background facts

The Accused was approached by one Raj, who indicated to the Accused that he knew the yard manager in Keppel FELS (KFELS). Together, the Accused, Raj and the yard manager had worked together to refer various vendors to KFELS. In exchange, they would ask these vendors to mark-up their invoices to KFELS, and subsequently obtain a cut of the marked-up invoice.

In the Court below, the Accused pleaded guilty to 15 charges of abetment by engaging in a conspiracy with two others to corruptly obtain gratification under section 6(a) read with section 29(a) of the PCA. The District Judge imposed a global sentence of 17 months and three weeks’ imprisonment. The Accused appealed against the District Judge’s decision on the grounds that the sentence imposed was manifestly excessive.

Development of a new sentencing framework for private sector corruption offences

In determining the appropriate sentence to mete out, the HC considered whether the two-stage, five-step sentencing framework set out in Masui was the appropriate framework to apply:

  1. At the first stage, the Court would consider the severity of the offense committed by having regard to all the offense-specific factors present on the facts of the case and arrive at an indicative sentence to reflect it.
    • At step one, the Court would identify and assess the relevant offense-specific factors present on the facts of the case.
    • At step two, the Court would broadly determine where the specific level of harm caused by the offender, and the specific level of his culpability, lay along the respective spectrum of harm and culpability, which throws up an indicative sentencing range.
    • At step three, the Court would, in the exercise of its sentencing discretion, make an assessment as to where exactly the offender’s offense lies within this sentencing range and select the most appropriate indicative starting sentence.

The HC in Masui had also relied significantly on statistical analysis (to the extent of employing graphs, algebra and even 3D modeling) for steps two and three in order to obtain an appropriate indicative sentencing range and starting sentence.

  1. At the second stage, the Court would consider all the offender-specific factors to derive a sentence for each individual charge:
    • At step four, the Court would consider the offender-specific factors which did not directly relate to the commission of the offense.
    • Finally, at step five, the Court would have regard to the totality principle in determining the final global sentence of the offender.

The HC found that the sentencing framework in Masui was excessively complex and technical, making it prone to confusion and uncertainty, thus rendering it of limited assistance to sentencing courts. The HC highlighted the following reasons:

  • Although it is correct as a matter of principle that a sentencing court should be able to utilize the full sentencing spectrum prescribed by Parliament, the sentencing framework need not progress smoothly and proportionately according to the severity of the offense. The severity of the offending conduct is but one of the various factors that the sentencing court takes into account in determining what the indicative starting sentence should be.
  • It is doubtful (if at all possible) for a sentencing court to undertake the exercise of identifying the specific harm/culpability levels associated with the offending conduct in each case. Every sentence reflects a complex amalgam of numerous and various factors and imponderables and requires the very careful evaluation by the Court of matters such as public interest, the nature of the offense and the circumstances in which it had been committed.
  • Sentencing is not a mathematical exercise; the sentencing framework should not be used to produce a mathematically perfect graph that identifies a precise point for the sentencing court to arrive at in each case. Rather, sentencing frameworks are only meant to serve as a guide.

The HC then developed the Revised Framework, which was modeled after the simpler two-stage, five-step framework in Logachev:

  1. At the first stage, the Court arrives at an indicative starting point sentence for the offender which reflects the intrinsic seriousness of the offending act. It involves the following three steps:
    • At step one, the Court identifies, by reference to factors specific to the particular offense under consideration, (i) the level of harm caused by the offense and (ii) the level of the offender’s culpability.
  • At step two, the Court identifies the applicable indicative sentencing range, by reference to the level of harm caused by the offense (in terms of slight, moderate or severe) and the level of the offender’s culpability (in terms of low, medium or high).
  • At step three, the Court identifies the appropriate starting point within the indicative sentencing range that has been identified pursuant to step two. In doing so, the Court has regard to the offense-specific factors and considers the harm and culpability levels associated with the offending conduct.

2. At the second stage, the Court makes adjustments to the starting point sentence identified under the first stage and arrives at a sentence that reflects the personal circumstances of the offender:

  • Step four requires the Court to make adjustments to the identified starting point as may be necessary to take into account aggravating and mitigating factors personal to the offender’s particular circumstances.
  • Where an offender has been convicted of multiple charges, step five requires the Court to consider if further adjustments should be made in view of the totality principle. The key is to ensure that the aggregate sentence is sufficient and proportionate to the offender’s overall criminality.

In applying the Revised Framework, the Accused’s appeal was dismissed, and the aggregate sentence imposed was enhanced to 37 months and three weeks’ imprisonment, more than twice his original sentence. 

Non-applicability of Revised Framework to section 5 of the PCA

The HC declined to apply the Revised Framework to offenses under section 5 of the PCA for the following reasons:

  • While section 5 of the PCA targets corrupt transactions more generally, section 6 of the PCA is specifically directed at a situation where the corrupt procurement of influence involves the agent subordinating his loyalty to his principal in furtherance of his own interests.
  • The different mischiefs at which each provision is directed gives rise to the possibility that different sentencing considerations may be relevant for offenses under section 5 of the PCA, as compared to offenses under section 6(a) and 6(b) of the PCA. For instance, offense-specific factors like actual loss caused to the principal and the extent of the offender’s abuse of position and breach of trust, which are prima facie relevant to an offense under section 6(a) or 6(b) PCA, do not readily feature in an offense under section 5 of the PCA.

Non-applicability of the Revised Framework to public sector corruption

The HC declined to apply the Revised Framework to public sector corruption for the following reasons:

  • The overarching sentencing consideration in a case of public sector corruption is the distinct public interest in eradicating corruption in the ranks of public servants upon whom the smooth administration and functioning of the State are dependent.
  • As for private sector corruption, the public interest is in the private sector maintaining a reputation for being corruption free, with business being conducted in a fair and transparent manner so as to ensure that the public’s legitimate expectations of bona fides, commercial even-handedness and economic welfare are not prejudiced, and that the efficient operation of the market is not disrupted.

Given the distinct overarching considerations, the Revised Framework should be limited only to private sector corruption offenses under section 6(a) and 6(b) of the PCA.

Conclusion

This decision provides some much-needed clarity in the realm of private sector corruption offenses, as it marks the HC’s departure from the 2-dimensional and 3-dimensional conceptual diagrams and models used in Masui.

Notwithstanding the need for consistent judgments, the paramount consideration for the Court is to ensure that individualized justice for each offender is obtained. As observed from this decision, a step towards a simpler but more practical approach to sentencing may afford the Courts more flexibility to deftly mete out sentences for offenses under the PCA.

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Celeste is a Principal in our Dispute Resolution and Employment Practice Groups. Her practice encompasses corporate and commercial dispute resolution, compliance and investigations. She has significant experience acting for global clients in cross-border disputes and advising clients on compliance and regulatory issues in the context of cross-border investigations. Celeste also has a particular focus in employment, particularly contentious employment work and employee investigations, and currently heads Baker McKenzie's Asia Pacific Employment & Compensation Practice. Celeste has been recognised as a 'Litigation Star' in the Labor and Employment space by Benchmark Litigation Asia Pacific, 2021 and has been ranked Band 1 in Employment in Singapore by Chambers Asia-Pacific since 2019 to date. She is recognised as "highly regarded in Singapore for her employment law advice, handling unfair dismissal claims and retrenchments"; a "source praises her 'very responsive and practical advice'" and that "Celeste is a brilliant lawyer and is able to provide effective advice to clients in a timely manner." Celeste is also ranked as a Leading Individual in Labour and employment in Singapore by Legal 500 Asia Pacific 2022 and noted as "a litigator with a strong record in employment disputes" and in the foreign firms section as "a dispute resolution specialist with an extensive record in contentious employment matters".

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Pradeep is a Local Principal in the Dispute Resolution Practice Group in Singapore. He advises and represents clients ranging from global corporations to tech start ups and individuals across all aspects of dispute resolution, including pre-litigation strategic advice, mediation, Singapore Court litigation and international arbitration. Pradeep also regularly advises and assists clients on a wide range of contentious and non-contentious employment law, investigations and compliance matters.
In The Legal 500 Asia Pacific rankings 2024, Pradeep was recognised as a "key lawyer" in Baker McKenzie Wong & Leow's Dispute Resolution, International Arbitration and Employment teams, with clients commending him for being “very commercially minded” and a “superb lawyer” (The Legal 500, 2024).
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