Crude oil products supplier Coastal Oil Singapore Pte Ltd, which has filed for liquidation in December 2018, has been linked to debt fraud.
COSCO Shipping International (Hong Kong) said that it has received claims from commercial banks seeking payments of alleged debt from one of its indirect wholly-owned subsidiaries, Sinfeng Marine Services Pte.
As informed, the troubled marine fuel player reportedly assigned to the banks receivables due from Sinfeng to Coastal Oil Singapore.
Namely, Coastal Oil Singapore was a major supplier of Sinfeng, which is engaged in the supply and trading of marine fuel and related products to major oil ports.
Specifically, Coastal Oil Singapore accounted for 94% and 93% of Singfeng’s total purchase costs for the year ended December 31, 2017 and the six months ended June 30, 2018.
“Based on a preliminary assessment, the management of Sinfeng is of the view that the documents in
relation to almost all of the alleged debts are not genuine,” COSCO Shipping International said in a regulatory filing.
“Sinfeng is still in the process of conducting an investigation and seeking professional advice in respect of the aforesaid matters.”
Sinfeng is working on finding alternative suppliers to Coastal Oil Singapore and will conduct a review of its business operations.
“The board expects that the revenue of the group will decrease significantly unless and until alternative suppliers to Coastal Oil Singapore are identified. However, in light of the insignificant profit contribution of Sinfeng, the board currently does not foresee any material adverse impact on the group as a result of the liquidation of Coastal Oil Singapore,” COSCO added.