Ex-oil tycoon OK Lim and children to file for bankruptcy as judgment for US$3.5 billion entered against them

SINGAPORE: Former oil tycoon Lim Oon Kuin, better known as OK Lim, and his two children have consented to a judgment of US$3.5 billion (S$4.5 billion) being entered against them.

At the same time, 82-year-old Lim and his two children, Lim Huey Ching and Evan Lim Chee Meng, said in statements on Monday (Sep 30) that they will file for bankruptcy as they do not have enough assets to pay all their claimants.

This means that while the liquidators of OK Lim’s defunct oil firm Hin Leong Trading have obtained a judgment for the US$3.5 billion owed, whatever recoverable sums will likely come from assets clawed back through the Insolvency & Public Trustee’s Office.

The decision came in the midst of a civil trial that opened in August 2023 and was brought by liquidators against the Lim family. Lim and his two children were expected to testify next in the trial, but the consent judgment supersedes that and brings trial proceedings to a close.

A consent judgment is made with the consent of all involved parties and is meant to be the formal result of a case and an expression of an agreement.

Hin Leong had suffered about US$808 million in losses from futures and swaps from 2010 to 2020, with the losses allegedly concealed by overstating profits by US$2.1 billion in the same period.

Lead counsel for the liquidators, Drew & Napier’s chief executive officer and Senior Counsel Cavinder Bull, had stated in his opening statement that the family had deliberately concealed Hin Leong’s losses and portrayed the company as profitable when it was, in fact, “massively insolvent”.

The figure of US$3.5 billion is the same figure Hin Leong, which is in compulsory liquidation, had sought the Lims to pay, and was the full amount of the company’s unsecured debts as of April 2020.

LIMS’ STATEMENTS

In separate statements to the media, the Lims said they continued to deny the civil suits made against them but were consenting to the judgment for various reasons.

The octogenarian, who is represented by lawyers from Davinder Singh Chambers, was convicted in May this year in a separate criminal trial for cheating and forgery.

He is scheduled to be sentenced on Oct 15.

The Lim patriarch said he had discussed the matter with his family and decided to focus only on his intended appeal against the criminal conviction, as well as another civil suit he is launching.

“As for all of the civil suits that have been made against me, while I continue to deny the claims, I do not wish to take up any more of the court’s time and resources,” said Lim. 

“I therefore offered to all the claimants who have sued me that I will consent to judgment without admission as to liability. I also informed these claimants that I do not have enough assets to pay all of them and will therefore be applying for bankruptcy.”

He said Sembcorp Cogen and Credit Agricole accepted his offer last week, and judgments without admission of liability in the sum of about US$142.3 million are in the process of being entered.

“The other claimants have asked for time, and I have asked them to reply to my offer by this week,” said Lim.

Lim’s 57-year-old daughter, who is facing a criminal charge for obstructing justice, said in her statement that she had been defending against multiple proceedings against her in the past few years.

“The protracted proceedings have taken a toll on my physical and mental well-being,” said Ms Lim, who is represented by a team from Advocatus Law led by managing partner Christopher Anand Daniel.

“After carefully considering the matter, I have decided that I need to focus on my health, and concentrate on defending against the criminal proceedings against me and pursuing my claims in (other suits),” said Ms Lim.

She similarly said she did not have enough assets to pay all of her claimants and would be applying for bankruptcy.

Lim’s son, who was represented by Damodara Ong law firm, said he had decided to focus only on one claim that he is mounting with his father and similarly does not have enough assets to pay all his claimants.

In a statement on behalf of the liquidators, Mr Goh Thien Phong told CNA: “This is an important milestone in the liquidation of Hin Leong, and is a victory that belongs to the creditors of Hin Leong!”

He thanked the liquidators’ lawyers, Senior Counsel Cavinder Bull, Mr Chia Voon Jiet and their team from Drew & Napier for “their extraordinary performance and dedicated efforts throughout this whole suit”.

“We also thank all creditors who have been very supportive of us throughout the liquidation process, and in particular in the pursuit of this suit against the Lim family as well as other suits,” said Mr Goh.