'MAY 14 '92 19:26 CLIFFORD CHANCE HK 852 8104708
interests of BMFL and BBMB.
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P.6
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The advances were made without proper examination and evaluation of the borrower and without proper documentation or in some cases any documentation whatsoever. All the advances were not properly secured to
guarantee payments.
Sandman his fellow co-directors and George Tan engaged in a number of fraudulent schemes and devices so as to conceal the improper and unauthorised nature of the advances. False correspondence and documentation was created and back-dated after the advances were given so that it would appear that they were properly considered and extended. Numerous shelf companies that were worthless, all controlled by George Tan
and incorporated shortly before the events were used as nominal borrowers so as to create the false appearance that a number of smaller loans had been extended to many unrelated companies and therefore by disguise the dangerous exposure of BMFL to the Carrian group. (80% of BMFL's total loan portfolio was extended to the Carrian group).
The advances were further concealed from BBMB and the financial regulatory authorities (the Banking Commissioner) by falsely reporting them as deposits with other banks and financial institutions (inter-banking money market loans) or syndicated loans in which a number of banks participated, or by eliminating them altogether from BMFL's weekly and monthly reports. These fraudulent manoeuvres and schemes were carried out by Saniman and others so as to conceal the irregular and unauthorised lending to the Carrian group and deceive the banks particular BBMB and BMFL into continuing to allow further fraudulent advances to be made to the Carrian group and thus deceive BBMB into continuing to fund BMFL by way of inter-bank money market lending.