Ex-Seagate Director acquitted of graft on appeal

SINGAPORE — A former Seagate Technology International Senior Director of Logistics was yesterday acquitted of 12 corruption charges on appeal, in what a High Court judge described as an “unusual” case.

In September 2004, Mr Henry Teo Chu Ha, who wanted to get rid of Seagate’s incumbent transport vendor, paid S$6,000 for 20,000 shares in Biforst Singapore, a company that was newly incorporated for that purpose.

In a tender the following month, Mr Teo managed to influence the selection process to award a contract to Biforst. The firm made successful bids in three subsequent tenders in 2005, 2007 and 2010.

Throughout those years, Mr Teo received 11 payouts from Biforst, corresponding to 22.5 per cent of the firm’s profits, which it marked in its books as “director’s fees”.

The prosecution’s case was that these payments and the shares were given as gratification to Mr Teo in return for the contracts. He was sentenced to six months' jail and ordered to pay a S$576,225 penalty.

In overturning the convictions yesterday, Justice Choo Han Teck pointed out that there was no evidence to show that the payments were “causally related” to any assistance rendered to Biforst for its tender bids between 2005 and 2010. They did not correspond with the dates of the tenders for the Seagate contracts, he noted.

The prosecutors also did not prove beyond reasonable doubt that the payment for the shares was sham and that the transaction was a reward or an inducement for the accused.

“It is not corruption unless the purpose of or reason for the gratification was as a reward or as an inducement for the act done by the appellant in relation to his principal, Seagate,” said Justice Choo. Instead, the case was one of “conflict of interest”, he added.

“Corruption is a narrow subset of situations which involve a conflict of interest and is defined under the Prevention of Corruption Act. The inference that suspicious activities arising from a conflict of interest must be corrupt must be resisted.”