Subsequent investigations by the Registry of Moneylenders revealed a host of irregularities in the way that Capital Alliance Credit was run.
The breaches included failing to inform a borrower in writing of the terms and conditions of a loan; giving unsecured loans exceeding $3,000 to a borrower with an annual income of less than $20,000; making a loan contract for which the interest rate was not stated or not truly stated; and knowingly or recklessly furnishing false or misleading information in its quarterly return.
Yesterday, the firm’s owner George Phua Chye Hee, 41, was fined a total of $214,000 for violating the Moneylenders Act and Rules.
Now unemployed, he had pleaded guilty to 30 of 90 charges, with the remaining counts taken into consideration during his sentencing.
He is the third licensed moneylender to have been dealt with recently. Two others, Goh Seng Kiat, 49, and Liew Yoon Kwai, 53, were fined $6,000 and $31,000 respectively.
Assistant Official Assignee Malcolm Tan earlier told the court that in August 2009, Phua granted a $5,000 loan to a borrower at 10 per cent interest a month. But he stated in the application document that the sum was $6,500, and that the interest rate was just 1.5 per cent a month.
The following month, the same borrower took a $3,000 loan from him. In the application document, Phua declared that it was for $3,600 and that the monthly interest rate was 1.5 per cent, when it was again 10 per cent.
Mr Tan said Phua had recklessly given misleading information to the registrar on six occasions. For instance, when he gave a $9,000 loan to a man in 2009, he told the registrar that the loan was for $10,000 and that it was meant for business purposes, when in fact he did not know what it was for.
The maximum fines for the offences ranged from $10,000 to $30,000 each.
ORIGINAL SOURCE
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