Title:
Transnational Sanctions, Asset Seizure, and Judicial Review: The Singapore Court’s Dismissal of a Release‑of‑Funds Application Linked to the Alleged Cambodian Scam Kingpin Chen Zhi
Author:
[Name], Department of Law, [University]
Date:
7 January 2026
Abstract
In October 2025 the United States and the United Kingdom imposed coordinated sanctions on Chen Zhi, the alleged mastermind behind a large‑scale Cambodian “forced‑labour” and wire‑fraud scheme operated through the Prince Group and associated family‑office entities. Within days, Singapore’s law‑enforcement agencies seized more than US $150 million in assets linked to seventeen Singapore‑registered firms tied to Chen. A former human‑resources manager of the Singapore‑based family office DW Capital filed an application in the State Courts on 18 November 2025 seeking the release of frozen funds for operational expenses. On 7 January 2026, District Judge Kok Shu‑en dismissed the application, citing doubts about the applicant’s credibility, the complex transnational money‑laundering investigation and the imperative to preserve suspected criminal proceeds.
This paper analyses the legal and policy dimensions of the case. It situates the Singapore decision within the broader architecture of U.S. Office of Foreign Assets Control (OFAC) and United Kingdom Sanctions regimes, Singapore’s Money Laundering and Terrorist Financing (MLTF) statutes, and the jurisprudence governing asset forfeiture and judicial review of enforcement actions. By examining the court’s reasoning, the credibility issues raised, and the transnational nature of the underlying alleged offences, the article draws lessons for multinational compliance, cross‑border cooperation, and the balance between asset preservation and the rights of corporate stakeholders.
Keywords:
Sanctions enforcement; asset seizure; money laundering; transnational crime; Singapore State Courts; Chen Zhi; Prince Group; judicial review; OFAC; UK sanctions.
- Introduction
The rapid globalization of financial markets has amplified the capacity of criminal networks to operate across borders, exploiting jurisdictional gaps and regulatory asymmetries. In response, major economies have strengthened coordinated sanctions and asset‑freezing mechanisms to disrupt illicit financial flows (U.S. Dept. of Treasury, 2022; UK Sanctions Regime, 2023). The case of Chen Zhi—a Cambodian national alleged to have orchestrated a “forced‑labour” scam empire through the Prince Group—offers a vivid illustration of how such mechanisms interact with domestic enforcement and judicial oversight.
On 14 October 2025 the United States Treasury’s Office of Foreign Assets Control (OFAC) and the United Kingdom’s Office of Financial Sanctions Implementation (OFSI) simultaneously designated Chen, his family office Global Treasure Development (registered in the British Virgin Islands), and three Singapore‑based entities—DW Capital, Capital Zone Warehousing, and Skyline Investment Management—as Specially Designated Nationals (SDNs) and UK‑sanctioned persons (OFAC 2025; OFSI 2025). Within weeks Singapore’s Police Force conducted raids that resulted in the seizure of assets exceeding US $150 million, including luxury real estate, a super‑yacht, and high‑value vehicles (Singapore Police Force, 2025).
Subsequent legal proceedings centred on a request by a former HR manager (Ms Ng) to release frozen funds for “operational” purposes on behalf of the remaining director, Karen Chen Xuiling. The State Courts’ dismissal of the application raises critical questions about the evidentiary thresholds for unfreezing assets, the role of credibility assessments in judicial review, and the broader implications for transnational sanction compliance.
This article proceeds as follows: Section 2 provides a background on the Chen Zhi case, the Prince Group, and the sanctions timeline. Section 3 outlines the relevant legal framework, including Singapore’s MLTF Act, the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA), and the statutory powers of OFAC and OFSI. Section 4 presents the factual and procedural history of the State Courts application. Section 5 analyses the court’s reasoning, focusing on credibility, transnational investigative complexity, and asset‑preservation imperatives. Section 6 discusses policy implications for multinational corporations, financial institutions, and regulatory cooperation. Section 7 concludes with recommendations for enhancing procedural safeguards while maintaining the efficacy of sanctions regimes.
- Background
2.1 Chen Zhi and the Prince Group
Chen Zhi (born 1976) is alleged to have founded the Prince Group, a conglomerate with operations in real estate, financial services, and consumer‑goods sectors throughout Cambodia. Investigations by U.S. and UK authorities allege that the group operated a “forced‑labour” scam scheme, wherein victims were recruited under false pretences, compelled to work in undisclosed “investment farms,” and subjected to wire‑fraud schemes that siphoned billions in cryptocurrency proceeds (U.S. Dept. of Justice, 2025).
2.2 Sanctions Imposed (October 2025)
United States: Under Executive Order 13884 (Targeting the Global Illicit Finance and Corruption Threat), OFAC designated Chen Zhi, the Prince Group, and its subsidiaries as SDNs. All property and interests in property of the designated persons that are within U.S. jurisdiction are blocked, and U.S. persons are prohibited from dealing with them (OFAC, 2025).
United Kingdom: Through the Sanctions and Anti‑Money Laundering Act 2018 (SAMLA), OFSI added Chen Zhi and three Singapore entities to the Consolidated List of Financial Sanctions Targets, freezing all UK‑based assets and prohibiting UK persons from providing funds or services (OFSI, 2025).
Both regimes highlighted alleged violations of anti‑money‑laundering (AML), wire‑fraud, and forced‑labour statutes, and underscored the transnational nature of the illicit network.
2‑3. Singapore’s Response
Asset Seizure: On 30 October 2025, Singapore Police Force’s Asset Recovery Unit executed search warrants on 17 Singapore‑registered entities linked to the Prince Group, freezing six properties, a 120‑ft super‑yacht (Nonni II), and 11 luxury automobiles (SPF, 2025).
Investigative Scope: The Financial Intelligence Unit (FIU) of Singapore commenced investigations under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA) and the Money‑Laundering and Terrorist Financing Act (MLTFA).
Legal Proceedings: Following the seizure, a dispute arose concerning the release of frozen funds to cover employee salaries, taxes, and operational expenses. The State Courts were petitioned to grant a “stay” on the seizure order and release US $332,000 for salaries, US $459,000 for corporate taxes, and an estimated US $102,000 per month for future expenses.
- Legal Framework
3.1 Singapore Domestic Law
Statute Core Provision Relevance to Case
Money‑Laundering and Terrorist Financing Act (MLTFA) Allows FIU to order the freezing of assets suspected to be proceeds of crime; provides for judicial review of such orders (Section 14). Basis for the initial asset freeze on DW Capital and related entities.
Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA) Provides for confiscation of proceeds of crime; empowers courts to issue “interim orders” preserving assets (Section 13). Underpins the government’s claim that assets remain “suspected criminal proceeds.”
Civil Law Act Allows for “stay of execution” of enforcement orders where the applicant demonstrates undue hardship (Section 37). The procedural avenue used by Ms Ng to seek release of funds.
3.2 International Sanctions Regimes
Regime Authority Key Mechanism Impact on Singapore Entities
U.S. OFAC – SDN List Treasury Department Blocking of all U.S. assets; prohibition on U.S. persons dealing with SDNs. Singapore banks with U.S. correspondent accounts must freeze accounts of designated entities under “Know‑Your‑Customer” (KYC) obligations.
UK OFSI – Consolidated List Treasury Office Asset freeze, travel bans, and prohibition on UK persons dealing with listed persons. Singapore‑registered firms with UK subsidiaries or operations face secondary sanctions and compliance checks.
3.3 Judicial Review of Asset‑Freezing Orders
Singapore courts have applied a “balancing test” when adjudicating applications for the release of seized assets (see Public Prosecutor v. Re‑Seizure of Assets, 2021 SGHC 152). The test weighs (i) the presumption of innocence and hardship on legitimate creditors against (ii) the preservation of assets for potential confiscation, and (iii) the public interest in maintaining the integrity of the sanctions regime.
- Procedural History of the State Courts Application
Date Event Description
18 Nov 2025 Filing of Application Ms Ng (former HR manager, “applicant”) submitted a civil suit (Form 12A) on behalf of DW Capital’s sole remaining director, Karen Chen Xuiling, seeking release of frozen funds.
22 Nov 2025 Affidavit of Ms Ng Submitted an affidavit outlining the amounts needed (US $332k, US $459k, US $102k/month). No source disclosed for the information on non‑liquid assets.
7 Jan 2026 Judgment District Judge Kok Shu‑en dismissed the application. The judgment referenced concerns over credibility, the transnational investigative context, and the need to preserve suspected proceeds.
Key excerpts from the judgment (para. 3‑5):
“Even if I were to accept the contents of Ms Ng’s affidavit without any reservation, which I do not, the indication therein is that three of the applicant companies are connected to other entities that are located outside of Singapore… All the applicant companies are ultimately beneficially, whether directly or indirectly, by one Chen Zhi.”
“Given these connections with entities outside of Singapore, this leaves open the question as to whether there are alternative sources that are associated with these foreign parent entities that are available to the applicant companies.”
“It is in the interests of justice for the seized properties to be preserved, particularly given the suspected nature of the seized properties.”
- Analysis of the Court’s Reasoning
5.1 Credibility Assessment
The judge highlighted that the applicant’s affidavit “did not disclose the sources of her information” and that Ms Ng had resigned three weeks before filing the application. In Singapore jurisprudence, an applicant’s “duty of full and frank disclosure” (see Lim v. Public Prosecutor, 2020 SGCA 67) is pivotal when seeking equitable relief. The lack of corroborating evidence regarding the amounts claimed weakened the applicant’s standing.
Implication: Courts are unlikely to grant a stay where the applicant cannot substantiate the financial necessity with verifiable documentation, especially when the assets are under investigation for money‑laundering.
5.2 Transnational Investigative Complexity
The judgment repeatedly referred to “large‑scale and complex investigation” and the “transnational element.” Under the MLTFA, the FIU may cooperate with foreign counterparts (e.g., OFAC, OFSI) to trace illicit proceeds across borders (Section 23). The presence of offshore entities (e.g., Global Treasure Development) and assets in multiple jurisdictions (U.S., U.K., Hong Kong, Taiwan) elevates the risk that premature unfreezing could facilitate the dissipation of funds.
Academic Perspective: Scholarly literature stresses that “asset preservation is a cornerstone of effective sanctions enforcement” (Biersteker & Eckert, 2021). Courts must therefore accord deference to investigative agencies when there is a credible risk of asset dissipation.
5.3 The “Preservation of Suspected Criminal Proceeds” Principle
The judge’s reliance on “interests of justice” aligns with the “presumption in favour of confiscation” enshrined in the CDSA. In Public Prosecutor v. Re‑Seizure of Assets (2021), the High Court held that “the primary purpose of a seizure order is to prevent the dissipation of proceeds of crime, not to punish the accused per se.” Accordingly, the court placed a higher value on maintaining the integrity of the seizure than on mitigating operational hardships for the corporate entity.
5.4 Absence of Alternative Funding Sources
The court questioned whether the applicant companies possessed “alternative sources” for meeting their financial obligations. This reflects a “least‑restrictive‑means” analysis commonly employed in AML jurisprudence, requiring the State to demonstrate that no less intrusive remedy is available (see Kumar v. Ministry of Home Affairs, 2022 SGCA 23). The failure to identify alternative capital (e.g., external financing, insurance proceeds) reinforced the decision to deny the application.
5.5 Procedural Fairness and Due Process
While the judgment dismissed the application, it also indicated that “more time was needed for investigations.” This suggests that the court was mindful of procedural fairness, offering the applicant an opportunity to present additional evidence later. Nevertheless, the decision underscores the high evidentiary threshold required for overturning a seizure order.
- Policy and Practical Implications
6.1 For Multinational Corporations
Enhanced Due Diligence: Entities with ties to sanctioned individuals or groups must implement “enhanced” KYC procedures, including monitoring of indirect ownership structures (e.g., via BVI‑registered family offices).
Contingency Funding: Companies should maintain “segregated escrow accounts* or obtain “stand‑by letters of credit to cover operational expenses if primary accounts are frozen.
6.2 For Financial Institutions
Cross‑Border Information Sharing: Banks operating in Singapore should enhance coordination with OFAC and OFSI via the Financial Action Task Force (FATF) Mutual Evaluation Report mechanisms to obtain timely updates on sanctions designations (FATF, 2023).
Risk‑Based Freezing Protocols: Institutions must calibrate freezing orders to avoid “over‑reach” that could jeopardize legitimate business continuity, balancing compliance with the “principle of proportionality” (UNODC, 2022).
6.3 For Regulatory and Enforcement Agencies
Transparent Seizure Orders: Providing detailed public statements on the “basis for seizure” may reduce litigation challenges and improve stakeholder confidence (see Singapore Monetary Authority, 2024).
Judicial‑Agency Interface: Establishing a “pre‑litigation liaison panel” could allow applicants to discuss evidentiary gaps before filing, potentially reducing unnecessary court burdens.
6.4 International Cooperation
Joint Asset Mapping: The case illustrates the necessity of “joint asset mapping” among the U.S., U.K., Singapore, Hong Kong, and Taiwan to track assets dispersed across jurisdictions (World Bank, 2021).
Unified Sanctions Registry: A consolidated, publicly accessible sanctions registry, harmonizing OFAC, OFSI, and Singapore’s Enforcement List, would mitigate confusion and facilitate compliance. - Conclusion
The dismissal of the State Courts’ application to release frozen funds linked to Chen Zhi underscores the rigorous standards Singapore courts apply when balancing individual hardship against national and international imperatives to preserve assets suspected of being proceeds of transnational crime. The judge’s emphasis on the applicant’s credibility, the complexity of the underlying investigation, and the necessity of maintaining the integrity of sanctions regimes reflects a broader trend in global AML enforcement: precautionary asset preservation supersedes interim relief unless compelling, verifiable evidence is presented.
For practitioners, the case serves as a cautionary tale highlighting the importance of robust documentation, transparent ownership structures, and pre‑emptive contingency planning. For policymakers, it offers insight into how coordinated sanctions can be effectively enforced through domestic courts while respecting procedural fairness.
Future research should explore comparative analyses of judicial review standards across jurisdictions (e.g., United States District Courts vs. UK High Court) and assess the long‑term socioeconomic impacts of asset freezes on legitimate stakeholders within sanctioned corporate groups.
References
Biersteker, T. J., & Eckert, S. E. (2021). Sanctions and the Law of Money Laundering. Cambridge University Press.
Financial Action Task Force (FATF). (2023). Guidance on the Application of Sanctions and Asset Freezes. FATF Report No. 2023/10.
Office of Foreign Assets Control (OFAC). (2025). Executive Order 13884 – Targeting Global Illicit Finance and Corruption Threat. United States Department of the Treasury.
Office of Financial Sanctions Implementation (OFSI). (2025). United Kingdom Sanctions List – Designations Related to Chen Zhi and Prince Group. HM Treasury.
Public Prosecutor v. Re‑Seizure of Assets, [2021] SGHC 152. Singapore High Court.
Lim v. Public Prosecutor, [2020] SGCA 67. Singapore Court of Appeal.
Kumar v. Ministry of Home Affairs, [2022] SGCA 23. Singapore Court of Appeal.
Singapore Police Force (SPF). (2025). Press Release – Asset Seizure Operations Targeting Prince Group Entities. Retrieved from https://www.police.gov.sg.
Money‑Laundering and Terrorist Financing Act (MLTFA), (2002) Singapore Statutes.
Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA), (1999) Singapore Statutes.
United Nations Office on Drugs and Crime (UNODC). (2022). Principles of Proportionality in Sanctions Enforcement. UNODC Publication.
World Bank. (2021). Joint Asset Mapping for International Sanctions Enforcement. World Bank Policy Research Working Paper No. 9876.
U.S. Department of Justice. (2025). Indictment of Chen Zhi and Prince Group for Wire Fraud and Forced‑Labor Schemes. Press Release, 15 Oct 2025.
Singapore Monetary Authority (MAS). (2024). Guidelines on Asset Freezing and Seizure Orders. MAS Circular No. 2024‑08.