Former S'pore navy captain gets 6 years, 10 months' jail after stealing S$2.2 million in crypto to pay off debts

A former captain with the Singapore Armed Forces' (SAF) Naval Diving Unit (NDU) was sentenced to six years and 10 months in jail after he broke into a man's condominium and stole about US$1.7 million (S$2.2 million) worth of cryptocurrency from the victim's account.

Teo Rong Xuan, 35, spent the money on various personal expenses, such as buying seven Rolex watches and an Audi, settling his legal and illegal gambling expenses, make mortgage payments, and top up his Central Provident Fund (CPF) account.

He previously pleaded guilty to six charges including housebreaking and using benefits from criminal conduct, and 10 other charges were taken into consideration.

His sentence, delivered on May 8, is backdated to Apr. 7, 2023, the date he was arrested.

Background

Teo joined the NDU in 2010, and held the rank of captain at the time of the offences.

After he and the victim met in June 2022 through a mutual friend, they co-founded a marketplace for Non-Fungible Tokens (NFTs) — digital assets recorded on blockchain like cryptocurrency.

On Dec. 31, 2022, he broke into the victim's condo unit using an access card he had kept with him from a previous visit.

Inside, he took a photo of a paper containing a passcode to the victim's offline cryptocurrency wallet, then left.

The next day, using the passcode, he gained access to the victim's cryptocurrency wallet on his own desktop computer, and transferred 1.7 million USDT (Tether coins) to his own cryptocurrency wallet.

When the victim later confronted Teo, he confessed to the theft, and explained that he did it because he had suffered huge monetary losses from the 2022 collapse of FTX, a major global cryptocurrency exchange.

Motivated by personal gain

The prosecutor sought a sentence of seven-and-a-half to eight-and-a-half years in jail.

He argued that Teo committed a premeditated act of theft "entirely motivated by personal gain", and that he had intentionally set up a "heist" to steal from the victim.

Additionally, Teo had spent all the money he stole from the victim, and the bulk of the stolen proceeds is unrecoverable, according to the prosecutor.

During investigations, the police managed to recover some of the proceeds, but nearly S$1.6 million was used to pay off Teo's gambling debts, and close to S$300,000 is unrecoverable as they were corporate expenses and payments for his public housing mortgage and his CPF account.

He has been unable to provide any further restitution for this outstanding sum, which stands at about S$1.8 million.

Adjustment disorder

In court, Deputy Principal District Judge Ong Chin Rhu cited a report by the Institute of Mental Health that said Teo was suffering from an adjustment disorder, CNA reported.

However, it added that the disorder was relatively mild, was likely exacerbated post-offence, and had no contributory link with the offence.

Teo requested to defer his sentence by three weeks, as he was arranging a pre-school for his child and bringing in a new domestic worker to handle matters in his absence.

This request was granted by the judge, and Teo is expected to start serving his sentence on May 29, according to CNA.