Singapore’s reputation for clean governance is facing its biggest challenge in decades after a graft probe ensnared a prominent tycoon and one of the city-state’s most senior ministers.
(Bloomberg) — Singapore’s reputation for clean governance is facing its biggest challenge in decades after a graft probe ensnared a prominent tycoon and one of the city-state’s most senior ministers.
The probe, which came to light earlier this week when Prime Minister Lee Hsien Loong ordered Transport Minister S. Iswaran to go on leave, has now publicly embroiled Ong Beng Seng, the managing director of Hotel Properties Ltd.
Authorities issued a notice of arrest for the tycoon and asked him to provide information on his interactions with Iswaran, according to a Hotel Properties statement to the Singapore stock exchange Friday.
While officials have yet to spell out the target or scope of their investigation, it’s the first time since 1986 that a Singapore graft probe has involved a senior minister. It comes at a particularly tricky time for the ruling People’s Action Party, which has long championed its corruption-free image. The party has faced a series of controversies in recent months as it navigates a leadership transition and voter unhappiness over rising living costs.
“When it comes to corruption, I think it’s a mother of all issues,” said Bilveer Singh, deputy head of the department of political science at the National University of Singapore. “The pressure on the prime minister to act and get to the bottom of it is so strong.”
Singapore is preparing for a presidential election to be held by September, allowing its citizens to vote on a largely ceremonial role. A general election must be held by 2025. The ruling party, which has been in power since Singapore’s independence in 1965, is also laying the ground work for a new generation of leaders to take over. Deputy Prime Minister Lawrence Wong is being primed to succeed Lee, who has been premier since 2004.
“We will be upfront and transparent,” Wong said in a Facebook post earlier this week. “We will not sweep anything under the carpet, even if they are potentially embarrassing or damaging.”
Iswaran and Ong would have interacted over the years as a matter of course, with the minister’s roles in trade and transport intersecting with the property tycoon known for helping bring the Formula One Grand Prix to Singapore. Iswaran, 61, has long championed the Singapore F1 night race in his various capacities.
The corruption agency, which reports directly to the prime minister, hasn’t specified what, if any, wrongdoing was involved. No charges have been filed, though Iswaran has been barred access to official resources and government buildings.
The country’s senior public officials are among the world’s best paid, a strategy Singapore’s political leaders say has helped to stave off corruption. Ministers earn about S$1.1 million ($822,000) a year, according to the Public Service Division’s website. The city-state is ranked as the fifth-least corrupt country in the world, according to the Transparency International Corruption Perceptions Index.
Ong is cooperating with the Corrupt Practices Investigation Bureau and posted bail of S$100,000 ($76,000), his company said Friday. He was to travel from Friday and will surrender his passport to CPIB when he returns to Singapore, according to the statement, which didn’t specify his exact whereabouts. Shares of Hotel Properties slumped as much as 7%, the largest intraday drop since March 2020, before closing 2.6% lower.
Read more: Singapore Minister Faces Most Serious Graft Probe Since 1986
Ong, the media-shy Malaysia-born businessman, was instrumental in bringing the Formula One Grand Prix to Singapore and is a key player in some of the island’s most significant corporate moments. Last year, a consortium led by Ong and units of state investment firm Temasek Holdings Pte won a bidding war to buy the property assets of the city’s main publisher. In 2003, Ong and tycoon Oei Hong Leong were engaged in a tussle over steel-miller NatSteel Ltd.
Ong is worth about $1 billion, according to the Bloomberg Billionaires index.
This isn’t the first time Ong has been entangled in controversies surrounding politicians from Singapore’s ruling party. In 1996, Prime Minister Lee, then a deputy prime minister, and his father Lee Kuan Yew, were cleared in an inquiry over claims of impropriety related to discounted purchases of four high-end apartments developed by Hotel Properties.
Ong’s business has a portfolio of nearly 40 hotels and resorts across 15 countries including the Four Seasons in Singapore and the Maldives, according to its website. It also builds luxury condominiums and owns malls.
Iswaran will remain in Singapore during his leave, according to a statement from the Prime Minister’s Office.
The long-time PAP stalwart was elected as a member of parliament in 1997 and was appointed to the cabinet in 2006. As transport minister, his key focus is to rebuild Singapore as an air hub in the aftermath of the pandemic and boost the nation as a maritime center. He’s also Singapore’s minister-in-charge of trade relations.
–With assistance from Natalie Choy, Ishika Mookerjee, Philip J. Heijmans, Ranjeetha Pakiam and Joyce Koh.
(Updates with additional context throughout)
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