SINGAPORE - Hin Leong Trading founder Lim Oon Kuin, also known as O.K. Lim, said it was “not very correct” to describe his two children as the most senior people in the company after him in 2020, when it was teetering on the brink of collapse.

The 81-year-old former oil tycoon said during Deputy Chief Prosecutor Christopher Ong’s cross-examination of his testimony on Friday that in early 2020, before his resignation, the leadership team included trading general manager Wong See Meng and operations head Lam Choon Sen, while land sales was headed by Derek Tan and his team.

“Contracts was by Serene (Seng),” Lim said, as he gave testimony in Mandarin through an interpreter. Madam Seng, who had worked at Hin Leong for close to 30 years, was his former personal assistant, and had been appointed head of contracts and corporate affairs manager.

When asked how his children, Mr Evan Lim Chee Meng and Ms Lim Huey Ching, fit in the leadership structure in 2020, Lim said: “My children followed me sometimes to have meals with clients, negotiate and develop business relationships. Huey Ching handled HR and accounts. I rarely contacted her.”

Prosecutors have accused Lim of cheating HSBC by representing to the bank, through Hin Leong’s employees, that the company had entered into two contracts for the sale of oil with China Aviation Oil (Singapore) or CAO, and Unipec Singapore, which they said were “complete fabrications, concocted on the accused’s directions”.

They claimed that Lim instructed Hin Leong’s employees to make fraudulent “discounting applications” to HSBC, based on bogus invoices and forged documents in relation to these purported transactions. As a result, the bank was allegedly “dishonestly induced” into disbursing some US$111.6 million (S$151.3 million) to Hin Leong.

Lim faces a total of 130 criminal charges involving US$2.7 billion in alleged fraudulent loans disbursed.

When asked why Madam Seng went to see Lim’s children before seeing him, when she wanted to own up that the two discounting applications had been mistakenly made, Lim said: “Because I am old, and these things they always handle, Serene handles. They don’t want to trouble me, so that’s why she went to see them.”

Asked why the various department heads would come to Lim, between 2010 and 2020, if they had important matters, he said: “Because they think I’m boss. It is a habit. In their heart, they think that.”

As to whether these important matters included Hin Leong facing margin calls, Lim said: “Margin calls, there’s no need, they can handle on their own. These things happened frequently.”

Once the third-largest bunker supplier in Singapore, Hin Leong’s foundations began crumbling when banks, spooked by defaults at other trading houses such as Agritrade International, began withdrawing credit lines.

Compounding the firm’s liquidity crunch was the oil price rout. Hin Leong had not sufficiently hedged against this, and was forced to sell its inventory to meet margin calls by numerous banks.

According to HSBC, Hin Leong was facing margin calls and repayment deadlines from banks, and allegedly did not have the funds to make these payments because its financial statements were “inflated”.

When asked three times by Mr Ong on Friday if he knew what a margin call meant, Lim said he did not know.

When asked if it meant the bank required Hin Leong to top up more money in its account with the bank, Lim said: “It was unnecessary for me to get involved... I don’t have time to understand such things.”

When asked if he understood what trust receipts were, Lim said he did not know.

When asked if he knew in 2020 that discounting an invoice meant that Hin Leong will present an invoice to the bank and the bank would pay first for oil Hin Leong had sold, Lim said: “I’m not clear about this.”

The prosecution and Lim crossed swords over whether Lim gave instructions to Ms Katherine Ong, a former senior accounts executive in Hin Leong’s treasury department, to address the company’s cash flow problems.

The prosecution said: “I put it to you that what you meant by your examination-in-chief (on Nov 1) is that when Katherine came to tell you Hin Leong’s cash flow situation was low, you would instruct her to go to traders to do more deals to address the low cash flow.”

Lim said: “Incorrect. I disagree.”

He also disagreed when Mr Ong said: “I put it to you that you are now trying to change your evidence that you were referring to deals that had already been done. The reason you are changing evidence is because you want to distance yourself from the fact that you had given instructions for addressing Hin Leong’s cash flow problems.”

When asked on Monday how involved Lim was in actual buy-and-sell negotiations with clients, he had said: “If we had a trade with Company A and the company wanted to do the same trade, we just have to tell her (Madam Seng) to follow the last deal, but change the time, quantity, price.”

On Friday, Lim told the court that he was the one who gave “the time, quantity and price” to Madam Seng. Mr Ong asked: “So she won’t come up with such details herself because she is not a trader?” Lim replied: “Yes, because she has many things to do.”

When asked if a deal that was fabricated based on forged documents can be discounted, Lim said: “It should not be taken for discounting.”

Mr Ong said: “In your view or understanding, anyone who submitted a fabricated deal or forged documents would be cheating the bank?”

Lim said: “Legally, I do not know. But what I give to the bank, it must be real.”

The prosecution’s cross-examination of Lim resumes on Nov 20, and the defence will be calling on another witness, Dr Yeo Seem Huat, Lim’s doctor, to take the stand.