SembCorp braces for litigation

Jurong Shipyard, which has been embroiled in a huge foreign exchange scam, is claiming that it is not liable for resultant losses. According to listed parent SembCorp Marine, losses from unauthorised foreign exchange transactions for the account of Jurong Shipyard run into $220M. The unauthorised transactions were made with 11 banks by former Director, Group Finance, Wee Sing Guan and do not include $83M, which Jurong paid to one of the banks before the scam was discovered. “SCM has successfully negotiated the complete close out of all outstanding Unauthorised Transactions with these banks,” SembCorp Marine has stated. The nature and extent of these transactions is being investigated and there is a “reasonable prospect” of litigation. The losses therefore have not been included in the latest quarterly results, which continue to be strong. Net profit rose 82% to S$81M ($55M) for 3Q07 while turnover increased 74% to S$1Bn due to growth in rig building, ship conversion & offshore and ship repair businesses. Net profit of S$240M for 9M07 has already surpassed 06 full year net profit of S$238M.