SINGAPORE: A reseller of sneakers bribed an assistant store manager at footwear retailer Foot Locker in exchange for information on when limited edition shoes would be "dropped" or launched.
He handed the manager bribes amounting to S$5,681 over 22 occasions, and made a profit of at least S$6,000 from reselling the sneakers.
China national and Singapore permanent resident Meng Fanxuan, 26, was fined S$20,000 on Thursday (Dec 23).
He pleaded guilty to one charge of bribing the Foot Locker store manager in exchange for insider information. A second charge of bribing an AW LAB sales associate in exchange for reserving limited edition sneakers was taken into consideration.
The court heard that Meng began collecting sneakers in 2008, when he first came to Singapore. He began reselling shoes in 2019, after he sold Nike shoes for a profit of S$29,000.
After that, he began frequenting sneaker stores such as Foot Locker and JD Sports to look out for shoes with a potential resale profit after deducting shipping fees and delivery taxes.
He targeted customers in China and would post his sneakers for sale on a China-based application, and was known as "Xiong Nan" in the shoe reselling business.
At the time of the offences in 2020 and 2021, he was serving his full-time National Service with the Singapore Armed Forces as an administrative support assistant.
Meng got to know Xavier Goh Yixuan, a 30-year-old assistant store manager of the Foot Locker store at Jewel Changi Airport, through a mutual friend.
He chanced upon Goh at the Jewel outlet in August 2020, and told him he was interested in buying discounted sneakers. He asked Goh to update him on future sales, seeing this as an opportunity to earn extra income with insider information.
Foot Locker had seven outlets in Singapore at the time, and the Jewel outlet was its second-largest store. Its most popular limited edition sneakers comprise two categories - the high-hit sneakers and the hot-sku sneakers, said the prosecutor.
High-hit sneakers have a synchronised launch date across Foot Locker's stores and will not be restocked once sold out and are limited to one purchase per customer. Hot-sku sneakers are not limited and can be restocked once sold out, but are limited to five purchases per customer.
Typically, there is online speculation as to the official release date on when the high-hit shoes would be "dropped". This begins about three to six months before sneaker brands such as Nike launch the footwear.
Sneaker brands would announce the official release date about two months before the shoes are dropped, but the actual launch date for Foot Locker outlets is restricted only to employees, who would know about it about a day before.
Foot Locker employees would know about the launch date of hot-sku sneakers only on the day itself. The specific launch dates for these limited edition shoes are not made known to customers as not all retail stores would be able to procure stocks from sneaker brands, and it is to avoid customers reselling the shoes at marked up prices.
Later in August 2020, Goh texted Meng and asked if he was looking for Nike Air Jordan 1 sneakers or any discounted shoes.
Meng said yes on both counts, and Goh asked if Meng could give him any incentive in exchange. Meng then offered to pay Goh in exchange for revealing information as to the launch date of the high-hit or hot-sku sneakers, as well as their sale date. He offered to share profits derived from every pair of sneakers he resold.
Despite knowing that this information was confidential, Goh agreed. He had signed the code of conduct at Foot Locker, which states that all non-public information about Foot Locker such as its products and release dates was to be treated as confidential and must not be disclosed.
Meng transferred sums of between S$50 and S$690 to Goh's bank account between August 2020 and January 2021, totalling S$5,681.
In return, Goh told Meng about the date discounted sneakers would be available for sale. He would obtain the information from emails sent by Foot Locker merchandising or marketing departments and reveal it to Meng, usually within the same hour.
In this way, Meng would know about the upcoming sales about a week before the sale date, and buy the discounted sneakers at the earliest possible timing.
Goh also told Meng about when Foot Locker was launching the high-hit or hot-sku sneakers, who would then head down to buy them at the earliest opportunity. He managed to buy at least 11 pairs of such shoes based on Goh's information.
When Meng was in the Jewel outlet, he and Goh avoided contact so that the other employees did not know about their relationship. Meng then resold the sneakers at marked-up prices and earned at least S$6,000 in profits.
Foot Locker fired Goh on Jan 29 this year, saying this case was "a serious breach of our policies and procedures" and amounted to "gross misconduct" that led to serious consequences for the company.
In mitigation, Meng said Goh was his friend and he offered to help him. He said he felt "obliged" to offer him money in return, and asked for a chance, saying this was his first such offence.
He said he did not have much savings as he just completed National Service and asked the judge to consider his situation. He was allowed to pay his fine in instalments by April.
Goh is set to return to court next week for a further mention of his case.
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He handed the manager bribes amounting to S$5,681 over 22 occasions, and made a profit of at least S$6,000 from reselling the sneakers.
China national and Singapore permanent resident Meng Fanxuan, 26, was fined S$20,000 on Thursday (Dec 23).
He pleaded guilty to one charge of bribing the Foot Locker store manager in exchange for insider information. A second charge of bribing an AW LAB sales associate in exchange for reserving limited edition sneakers was taken into consideration.
The court heard that Meng began collecting sneakers in 2008, when he first came to Singapore. He began reselling shoes in 2019, after he sold Nike shoes for a profit of S$29,000.
After that, he began frequenting sneaker stores such as Foot Locker and JD Sports to look out for shoes with a potential resale profit after deducting shipping fees and delivery taxes.
He targeted customers in China and would post his sneakers for sale on a China-based application, and was known as "Xiong Nan" in the shoe reselling business.
At the time of the offences in 2020 and 2021, he was serving his full-time National Service with the Singapore Armed Forces as an administrative support assistant.
Meng got to know Xavier Goh Yixuan, a 30-year-old assistant store manager of the Foot Locker store at Jewel Changi Airport, through a mutual friend.
He chanced upon Goh at the Jewel outlet in August 2020, and told him he was interested in buying discounted sneakers. He asked Goh to update him on future sales, seeing this as an opportunity to earn extra income with insider information.
BACKGROUND ON THE SHOE DROPS
Foot Locker had seven outlets in Singapore at the time, and the Jewel outlet was its second-largest store. Its most popular limited edition sneakers comprise two categories - the high-hit sneakers and the hot-sku sneakers, said the prosecutor.
High-hit sneakers have a synchronised launch date across Foot Locker's stores and will not be restocked once sold out and are limited to one purchase per customer. Hot-sku sneakers are not limited and can be restocked once sold out, but are limited to five purchases per customer.
Typically, there is online speculation as to the official release date on when the high-hit shoes would be "dropped". This begins about three to six months before sneaker brands such as Nike launch the footwear.
Sneaker brands would announce the official release date about two months before the shoes are dropped, but the actual launch date for Foot Locker outlets is restricted only to employees, who would know about it about a day before.
Foot Locker employees would know about the launch date of hot-sku sneakers only on the day itself. The specific launch dates for these limited edition shoes are not made known to customers as not all retail stores would be able to procure stocks from sneaker brands, and it is to avoid customers reselling the shoes at marked up prices.
Later in August 2020, Goh texted Meng and asked if he was looking for Nike Air Jordan 1 sneakers or any discounted shoes.
Meng said yes on both counts, and Goh asked if Meng could give him any incentive in exchange. Meng then offered to pay Goh in exchange for revealing information as to the launch date of the high-hit or hot-sku sneakers, as well as their sale date. He offered to share profits derived from every pair of sneakers he resold.
Despite knowing that this information was confidential, Goh agreed. He had signed the code of conduct at Foot Locker, which states that all non-public information about Foot Locker such as its products and release dates was to be treated as confidential and must not be disclosed.
MENG TRANSFERRED MONEY TO GOH OVER 22 OCCASIONS
Meng transferred sums of between S$50 and S$690 to Goh's bank account between August 2020 and January 2021, totalling S$5,681.
In return, Goh told Meng about the date discounted sneakers would be available for sale. He would obtain the information from emails sent by Foot Locker merchandising or marketing departments and reveal it to Meng, usually within the same hour.
In this way, Meng would know about the upcoming sales about a week before the sale date, and buy the discounted sneakers at the earliest possible timing.
Goh also told Meng about when Foot Locker was launching the high-hit or hot-sku sneakers, who would then head down to buy them at the earliest opportunity. He managed to buy at least 11 pairs of such shoes based on Goh's information.
When Meng was in the Jewel outlet, he and Goh avoided contact so that the other employees did not know about their relationship. Meng then resold the sneakers at marked-up prices and earned at least S$6,000 in profits.
Foot Locker fired Goh on Jan 29 this year, saying this case was "a serious breach of our policies and procedures" and amounted to "gross misconduct" that led to serious consequences for the company.
In mitigation, Meng said Goh was his friend and he offered to help him. He said he felt "obliged" to offer him money in return, and asked for a chance, saying this was his first such offence.
He said he did not have much savings as he just completed National Service and asked the judge to consider his situation. He was allowed to pay his fine in instalments by April.
Goh is set to return to court next week for a further mention of his case.
Continue reading...