Phantom Workers in Singapore: What They Are and How to Protect Yourself from CPF Fraud

Hey there! Let’s talk about something pretty sneaky happening in the job market that you might not have heard about: phantom workers. Sounds like a ghost story, right? Well, it’s real, and it’s definitely something you want to be aware of, especially if you live in Singapore or are dealing with CPF contributions.

So, who or what exactly is a phantom worker? Simply put, a phantom worker is someone who is officially listed as an employee of a company on paper, and as a result, CPF contributions are made for them. But here’s the kicker—they don’t actually work for that company. Nada. Zero hours clocked. Sometimes, these phantom workers are seniors or other vulnerable people who get roped into these schemes without fully understanding what’s happening.

Why Would an Employer Do This?

You’re probably wondering why an employer would pay CPF contributions for someone who’s not doing any work. It all boils down to loopholes, cost-cutting, and unfortunately, some unethical behavior. One of the biggest reasons is to get around the quota for hiring foreign workers.

The Ministry of Manpower (MOM) in Singapore has a quota system in place that limits how many foreign workers a company can hire based on the number of local employees. If a company wants to hire more foreigners, they need to have enough local employees first. Here’s where phantom workers come in. By declaring local phantom workers, the company artificially inflates its local headcount. This means they can hire more foreign workers than they’re allowed to, and they only have to pay CPF contributions on these phantom workers—not full salaries. This is a classic example of cutting corners, but it’s illegal and unethical.

Tax Evasion and Abuse of Government Funds

There’s another shady side to this story. Employers who have phantom workers might claim these CPF contributions as business expenses, lowering their taxable income. More money saved, less tax paid. Plus, some government schemes provide incentives or payouts to companies that hire and train local employees. If the company is faking those numbers with phantom workers, they’re basically cheating the system and misusing government funds that are meant to support genuine employment growth.

How Do Employers Actually Hire Phantom Workers?

This part is a bit disturbing. To put someone down as a local employee, an employer needs some personal info—like your Singpass or CPF account details. Sometimes, they might approach individuals, particularly seniors, promising CPF contributions as a reward for sharing their details. Once they have these, they can register you as an employee, even if you never stepped foot in their office or did any work for them.

Sometimes people don’t realize what’s at stake—they might think it’s harmless or a way to get some extra CPF money without much effort. But personal information can be misused, and involvement in these schemes can lead to serious consequences.

What Happens If You Become a Phantom Worker?

This isn’t just a slap on the wrist situation. Hiring phantom workers and making false employment declarations violates the Employment of Foreign Manpower Act 1990 (EFMA). Employers caught doing this can have their work pass privileges suspended. The phantom workers? They might be barred from working in Singapore in the future.

And it gets harsher. If you provided your personal details knowing they’d be used for fraudulent CPF claims, you could be prosecuted for aiding illegal activities. Even if you didn’t know—say your info was taken without your knowledge—you could still face investigations. It’s a scary prospect, so staying alert is important.

How to Protect Yourself from Being a Phantom Worker

The best advice: never give out your personal info without verifying who’s asking for it and why. If someone promises CPF contributions in exchange for your details, be suspicious and ask plenty of questions.

You should also regularly check your CPF transaction history. If you see CPF contributions from an employer you don’t know or haven’t worked for, it’s time to raise a red flag. Try to contact that employer to clarify. If they don’t respond or you can’t reach them, consider reporting the issue to CPF or relevant authorities.

Keeping track of your CPF contributions isn’t just about knowing what’s going into your savings—it can be a crucial step in protecting your identity and preventing fraud.

Why Should You Care?

Besides the obvious legal and financial risk, phantom worker schemes are unfair. They cheat the system, hurt honest job seekers by stuffing companies with fake locals just to hire more foreigners, and siphon government resources meant for real workers.

By staying informed and vigilant, you help keep the job market fair and transparent for everyone.

So, next time someone offers you CPF contributions for doing nothing, think twice. It might look like a sweet deal, but it can land you in hot water. Protect your personal info, monitor your CPF, and don’t hesitate to question suspicious offers.

Stay safe and savvy out there!

Note: The info shared here is accurate as of September 2025.