Due diligence on the local business operations of a prominent Western manufacturer in a certain Southeast Asian country developed detailed allegations of systemic facilitation payments made to officials of various state-owned operating entities, as a result of which the local business operations had secured a number of installation and maintenance contracts.
A potential investor considering a multi-million dollar minority position in a fixed asset in a certain Southeast Asian country commissioned due diligence into the asset owner. The investigation determined that the owner had close business partnerships with senior military figures, had a history of settling disputes outside the court process, and owned the asset through family nominees. The investment nonetheless proceeded; the venture subsequently fell apart and the investor was unable to recover any funds.
Pre-transaction due diligence
A fund seeking to make a large investment in a well reputed Singapore tech start-up commissioned pre-investment due diligence research into the company and its directors and shareholders. This determined that a major shareholder in the company had an undisclosed previous conviction for serious fraud under a name spelling variation not commonly associated with the individual.
A US-listed engineering company needed to understand the potential political influence and leverage of a seemingly low profile but litigious local competitor in Malaysia. Discreet enquiries, in combination with targeted open source research, determined that a director was the brother of one of Malaysia’s wealthiest business tycoons, connected at the highest levels of Malaysian politics. The family relationship had been obscured by a lack of shared family name, but the connection was confirmed through research of public record information in Malaysia and the United Kingdom, building on source intelligence developed in Southeast Asia.
Institutional investors placed US$100 million into a Chinese retail group seeking to list on the Hong Kong Stock Exchange (HKSE). The IPO was denied by the HKSE. A subsequent four-month investigation revealed that the Chinese group had fabricated cash flow statements, grossly misrepresented its retail business operations in China and diverted funds for its retail business to other businesses.
A leading MNC in the commodities sector discovered that over 40,000 tons of its commodity was missing from its warehousing sites in Southwestern China, with an initial loss to the client valued at US$20 million. A subsequent three-month investigation gathered intelligence on the mastermind, implicated other colleagues at the client’s JV factory as well as certain customers, and uncovered valuable insight into the flow of illicit gains from this theft.
An investigation into an electrical products supplier in Myanmar revealed hidden beneficial ownership by a Burmese individual sanctioned by the US Treasury’s Office of Foreign Assets Control due to links to the North Korean regime. The US-listed client was able to act on the finding avoiding the potentially substantial fines and reputational damage associated with forming a business relationship with a sanctioned party.
Supply Chain Audit
A covert one-year investigation for a leading manufacturer of sports apparel that identified major leakage of finished goods/component parts, products in development and proprietary information from authorized manufacturers in China, Vietnam, Indonesia and Korea. We subsequently designed and executed a security audit programme for nearly 50 manufacturing facilities in Asia which was highly effective in reducing product leakage and safeguarding intellectual property and information assets.
Casinos, Crypto & Covid
Lyriant has access to a broad regional network of sources in the cryptocurrency and online payments industries throughout the Asia Pacific. Cryptocurrencies play an increasingly integral role in the China-focused casino, junket and online gaming industries in Asia and are used to circumvent strict currency control measures in force in China. The rapid shift in gambling from physical casinos to online caused by Covid-19 has also placed digital currencies at the centre of a complex and transnational network of online gaming businesses operating mostly from jurisdictions with weak regulatory oversight.
An investigation into a low profile yet wealthy businessman and influential figure in the global online gaming and Asian casino junket space, identified connections between this individual and underground crime figures connected to the casino gaming industry in Asia. These links gave rise to significant issues of concern for our client, which was seeking to onboard the businessman as a banking customer. It was also determined that the businessman had employed a large team of technologists, crypto experts and programmers to help facilitate cryptocurrency movements on behalf of other online gaming operators, casino junket agents and players coming from China and deployed Bitcoin as a tool to move money in and out of China. The casino VIP room cages and underground bank networks, including the use of cryptocurrencies and other flexible methods of getting China-located player funds offshore, were crucial to this businessman’s huge profits and were managed via a complex web of offshore entities and nominee structures, thus also triggering significant concerns around money laundering risk for our client.