Man under police probe for alleged cheating over use of shell companies to avoid rent
Police found grounds to investigate Mr Anthony Thomas Price after reviewing a court ruling that identified a pattern of the American using shell companies to live rent-free, said Senior Minister of State for Law Murali Pillai.
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SINGAPORE: The police are investigating a man for alleged cheating after a court found that he had a pattern of using shell companies to live rent-free in residential properties, Senior Minister of State for Law Murali Pillai said in parliament on Wednesday (Nov 4).
The official receiver is also investigating possible fraudulent trading and wrongful trading offences, and the Accounting and Corporate Regulatory Authority (ACRA) is looking into potential breaches of the Companies Act by the relevant entities and individuals, added Mr Murali.
The official receiver is a public officer appointed by the High Court whose role includes investigating wrongful trading offences, acting as liquidator in compulsory winding-up cases, and overseeing private liquidators.
Those guilty of cheating face up to 10 years' jail, and may also be fined or caned, or both.
“As investigations are ongoing. I will not say more. Nothing I have said should be taken as a view on whether an offence has been committed,” said Mr Murali.
He was responding to parliamentary questions about the use of shell companies to rent residential properties and avoid paying rent.
The questions follow a court ruling last month that found an American man had a "pattern" of using shell companies to live rent-free in residential properties.
In a judgment dated and published on Oct 7, a company used by Mr Anthony Thomas Price was ordered to return a landed property in Kembangan to its landlords and pay unpaid rent and other sums.
The judge also found that Mr Price had used shell companies to rent two other landed properties between 2019 and 2024.
A court case involving a residential property in Kembangan was settled, while another involving a home in Siglap was still ongoing as of October.
In parliament, Mr Pillai said companies can legitimately lease residential properties, such as to house employees posted to Singapore, and that the company — rather than its directors or shareholders — is generally liable for the rent.
But he said the law does not allow companies to be used as a cover for fraud or to let the individuals who set them up evade their responsibilities.
Besides possible criminal penalties, those involved may also be made personally liable for a company’s debts, for example, in cases of fraudulent or wrongful trading, said Mr Murali.
"The court can disregard the corporate form where it is abused for an improper purpose," he added.
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In response to a question from MP Yip Hon Weng (PAP - Yio Chu Kang SMC) on whether personal guarantees should be mandatory for corporate residential tenancies, he said such a rule would take away flexibility.
Currently, landlords can require personal guarantees from directors or other individuals before leasing their properties to companies.
"(A blanket mandatory rule) would restrict the genuine arrangements that landlords and tenants can enter into, and impose unnecessary burdens on legitimate transactions,” said Mr Murali.
"At the same time, imposing such a requirement might not stop someone determined to cheat, who could appoint a director with no assets to give the guarantee."
Mr Murali also encouraged landlords to conduct due diligence before entering into tenancy agreements, pointing to resources such as a Council for Estate Agencies checklist that includes verifying a company's registration details with ACRA, among other things.
Citing data from the Small Claims Tribunals' filing system, Mr Murali said between 1,100 and 1,840 claims related to residential leases were filed each year from 2021 to 2025.
Of these cases, between 14 and 40 claims a year – or about 1 to 2 per cent – involved cases where the claimant indicated "rental arrears" and the respondent party was a company or other entity.
The Small Claims Tribunals can hear eligible claims of up to S20,000,orS30,000 if both parties agree.
Larger claims are filed in the civil courts, whose filing system does not record whether a claim involves unpaid rent, said Mr Murali.
MP Fadli Fawzi (WP - Aljunied GRC) also asked if it would be in the public interest to ban shell companies with negligible capital or recoverable assets from renting residential properties.
Mr Murali responded that there are “reasonable grounds for a company to be formed with little capital”, such as by an entrepreneur who funds a company through loans rather than capital.
He added that policies must balance the interests of landlords and tenants without inadvertently disadvantaging either party.
Mr Murali also noted there are expedited processes for landlords to seek repossession remedies such as the Small Claims Tribunals and the Distress Act.
"But if you want to go beyond that and say order vacant possession on an expedited basis without notice, then I think you'll be tilting the balance too much in favour of the landlord," said Mr Murali.
Addressing concerns about copycat cases, Mr Murali said the ongoing investigation into Mr Price is a "signal that if they want to copy, they should tread with care".
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