Rise and fall of Tan Koon Swan

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KUALA LUMPUR: Self-made businessman Tan Koon Swan was the rising star in corporate Malaysia and the MCA in the late 1970s and early 1980s, until the Pan-Electric Industries fiasco, which shattered the local and Singapore stock markets, in 1985.
His political career was eclipsed and his corporate empire collapsed after he was convicted in Singapore of share manipulation and criminal breach of trust. He was also made a bankrupt at one time for failing to fulfil his obligations to banks.
Born into a poor family in Puchong, Tan finished his Form 5 education in a missionary school. Starting out as a clerk at the then Lembaga Letrik Negara and later becoming a tax consultant with Esso, Tan was roped into Genting Bhd by the late Tan Sri Lim Goh Tong. He later became its general manager. In his book My Story, the Genting founder has favourable remarks about Tan’s abilities.
The handsome young man caught the eye of Tan Sri Lee San Choon, the powerful president of MCA, in the 1970s. Lee invited Tan, who was an eloquent public speaker with exciting corporate views, to start Multi-Purpose Holdings Bhd (MPHB) and cooperatives for the MCA.
At the time, Tan was also building a name as a corporate player with the Midas touch. Shares of his listed companies, such as Supreme Corp, were flying high and so was his political star. The other listed firm controlled by him was Sigmal International, which had a 22.6% stake in Pan-El.
Indeed, the roaring success in pooling the financial resources of MCA members to build MPHB turned Tan into a corporate hero.
He also became a threat to Datuk Neoh Yee Pan, the then deputy president of MCA. The two were at loggerheads and after a two-year do-or-die political tussle, Tan took over the top post in November 1985.
But just as he was emerging from the political crisis at MCA, he was confronted with another bigger crisis — the collapse of Pan-El in Singapore, which caused several stockbroking firms in Singapore and Malaysia to go under. He was arrested in Singapore in early December 1985 for commercial crimes relating to Pan-El.
In 1986, Tan was sentenced to two years’ jail by the Singapore High Court. Justice Lai Kew Chai said Tan’s offences had “struck at the very heart, integrity, reputation and confidence of Singapore as a commercial city and financial centre”.
Soon after, Tan resigned as MCA president. In 1988, after serving his jail term in Singapore and returning home, he was imprisoned in Malaysia and declared a bankrupt after failing to service bank loans totalling US$100 million.
 
This article is appeared in The Edge Financial Daily on 11 September, 2012.
 
In the mid-1990s, Tan was discharged from bankruptcy after a settlement with the banks.
During his imprisonment in Singapore, Tan was implicated in a separate financial case in Hong Kong. However, the investigation determined that Tan did not do anything wrong and was not a “financial crook” as alleged.
The findings of the investigation were never published but it cleared Tan of wrong-doing in the Hong Kong financial case which brought investigators from the island to Malaysia.
Tan has since lived a low-profile life. Though bitter when he recalls the past, he has refrained from speaking out against others, an act that has earned him respect. As a born-again Christian, the 71-year-old has on several occasions advocated forgiveness and love.
Currently, his children are helping him with property development in Malaysia while he personally handles his investments in Hainan Island, China.
Three years ago, Tan contemplated looking for a ghost writer to help him write his autobiography but it has not seen the light of day yet.