The Great COE Scam

By: Mellanie Hewlitt
Singapore Review
15 Jan 2005

COE, Parf, ARF - confused? Characteristics of The Great COE Scam

It is glaring that although Singapore has the world's most expensive cars, the vast majority of car owners remain confounded by the complicated pricing and ownership system. (See artcile from the New Paper 14 Jan 2005 "COE, Parf, ARF - confused?")
http://newpaper.asia1.com.sg/top/story/0,4136,81225,00.html?

In all developed countries, buying a car is a simple and transparent affair that is concluded between buyer and seller. The only other third-parties involved are the insurance company and the finance company. In Singapore a series of bureaucratic shields and paperwork complicate the process.

The system is massively complicated, designed to confuse the average car buyer. The objective is to disguise the underlying scam which involves siphoning funds from the car owner into the bloated coffers of the government.

The latest tender saw car COE premiums ending at $18,400 (up to 1,600cc) and $14,002 (above 1,600cc) - the lowest in over a decade. The government is set to release between 100,000 to 120,000 COEs this year. At anaverage COE "price" of approx SGD16,201 per COE this amounts to a whopping SGD1,944,120,000/- in COE revenue for the government.

Although the supposed objective of the COE system was to regulate traffic flow and reduce traffic congestion, a number of characteristic reveal the actual COE scam which has the hidden purpose of siphoning funds from car owners.

The scam is Revealed via the following formulae:

COE Revenue = COE Price X Number of COE issued.

Regardless of the price of the COE, the total COE revenue collected remains generally stable at approx SGD1.994 billion. This is because any fall in price is compensated by issuance of more COEs hence keeping the COE revenue relatively stable.

Below are some of the characteristics of the COE scam:

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