Friday, 29 June 2012

City Harvest case: '$50m misused'

Fresh revelations of another $26.6m allegedly used in cover-up bid
By Leonard Lim, The Straits Times, 28 Jun 2012

CITY Harvest Church's Kong Hee and four others were charged yesterday with allegedly siphoning church money, amid fresh revelations that they conspired to cheat the church of over $50 million.

It emerged yesterday that $26.6 million was allegedly used to cover up an initial $24 million which they had taken from the church's building fund and put into sham investments.

These investments in turn were actually being used to finance the music career of Kong's wife Ho Yeow Sun.

Kong, 47, who showed up at the Subordinate Courts holding Ms Ho's hand and surrounded by a phalanx of supporters, faces three counts of committing criminal breach of trust as an agent.

If found guilty, he could be jailed for life.

All 6 accused, including founder Kong Hee, found guilty of all charges

He and the other four accused are to return to court on July 25. All five posted bail of $500,000 each, with Kong's bail put up by his 42-year-old wife's parents. The passports of the five charged have been impounded.

Their appearance in court yesterday came a day after the Commercial Affairs Department swooped in on them in their homes early on Tuesday morning, wrapping up a two-year probe.

On the same day, the Commissioner of Charities revealed that financial irregularities amounting to at least $23 million had been discovered and eight church members, including the five, had been suspended.

Yesterday, court documents showed that this alleged conspiracy was carried out through bond investments in two companies.

These were Ms Ho's artist management firm Xtron Productions, and PT The First National Glassware, also called Firna and owned by a church member.

Through supposed investment in Xtron bonds, $13 million was allegedly misappropriated from the building fund of one of Singapore's largest churches.

Another $11 million was said to have been channelled to sham investments in Firna bonds.

The prosecution revealed yesterday - to a courtroom packed with nearly 200 City Harvest members and supporters - that a second series of transactions was allegedly devised to misappropriate a further $26.6 million.

The prosecution said: 'These further monies were circulated... to create the false appearance that the purported sham bond investments had been redeemed, when in fact the 'redemption' had been financed using these further monies misappropriated from church funds.'

This 'round-tripping' meant that more of City Harvest's building fund cash was used to repay the sums owed to itself.

The $26.6 million cover-up bid came about after the church's auditor had raised questions about the purported bond investments.

Like Kong, who is represented by Edwin Tong of Allen & Gledhill, church management board member John Lam Leng Hung, 44, faces three similar charges.

The others charged - Kong's deputy Tan Ye Peng, 39; church finance manager Sharon Tan Shao Yuen, 36; and investment manager Chew Eng Han, 52 - were slapped with more charges.

Chew and Tan Ye Peng each face 10 charges - six for criminal breach of trust and four for falsifying accounts.

Sharon Tan was charged with four counts of falsifying accounts and three for committing criminal breach of trust as an agent.

The first offence draws a maximum of 10 years' jail, and or a fine. The second, which Kong's charges come under, is punishable with a life sentence, or jail of up to 20 years and a fine.

The total sum of $50.6 million that the five conspired to cheat the church of makes the City Harvest case the biggest financial scandal involving a registered charity. It eclipses the $12 million that the National Kidney Foundation sued Mr T. T. Durai and three others for, and the $50,000 unauthorised loan Ren Ci hospital's Ming Yi was jailed for.

Yesterday, more than 200 people gathered outside the courthouse before Kong, their spiritual leader and the founder of City Harvest, arrived with his wife.

Minders had to cut their way through the media scrum from the street to the building, with the couple taking small steps and keeping their gaze fixed ahead amid non-stop camera clicks.

City Harvest, established in 1989 with 20 members and now about 33,000-strong, later issued a statement on its website.

It said church operations and cell group meetings will continue, including weekend services at Singapore Expo and Jurong West.

The case has triggered a maelstrom of reactions online, for and against the church. The president of the National Council of Churches of Singapore, Bishop Terry Kee, yesterday sought the understanding of fellow Singaporeans, urging them 'not to react against the church or churches here'.

Documents throw light on web of transactions
Millions allegedly used to cover up series of 'sham' bond investments
By Leonard Lim, The Straits Times, 28 Jun 2012

COURT documents yesterday shed more light on the elaborate web of transactions carried out to hide the alleged siphoning of funds by City Harvest Church founder Kong Hee and others in his inner circle.

Six transactions, which apparently channelled money from the church's building fund into furthering the music career of Kong's pop singer wife Sun Ho or to cover up past deals, were detailed.

The alleged offences - to help a celebrity who has a US$20,000 (S$25,000) a month Hollywood Hills mansion and four No.1 hits on the Billboard dance charts - allegedly took place between August 2007 and November 2009.

Sun's artist management firm Xtron Productions and PT The First National Glassware (Firna), a decorative glassware firm owned by a City Harvest member, were said to have received millions for purported investment in their bonds.

First, a total of $10 million was disbursed to Xtron between Aug 23, 2007 and Jan 2, 2008; another $3 million went out from the church to it on or about March 5, 2008.

Xtron was founded in 2003 by Chew Eng Han, one of the five charged yesterday. The firm supplies City Harvest with video and audio equipment and acts on behalf of the mega church in its rental lease agreements.

Firna is owned by Singapore permanent resident and Indonesian businessman Wahju Hanafi, who has declared his loyalty to City Harvest in his Facebook and Twitter accounts.

Between Oct 6, 2008 and June19, 2009, a total of $11 million was allegedly transferred to this firm.

The prosecution said yesterday that the 'sham transactions' were purportedly devised to conceal the diversion of money into furthering Sun's career.

The total apparently siphoned to Xtron and Firna amounted to $24 million, and constituted criminal breach of trust (CBT) offences, said the prosecution.

Deputy Public Prosecutor Christopher Ong called a second set of CBT offences 'round-tripping'. These comprised a complex set of transactions carried out between October and November 2009, aimed at wiping the purported bond investments off the church's accounts by using church funds to repay the sums owed to itself. This covering of the money trail took place after City Harvest's auditor raised questions about the investments.

First, about $15.2 million was allegedly disbursed to Xtron, under the guise of an 'advance rental'.

Next, payments of $5.8 million and $5.6 million were made to Amac Capital Partners' special opportunities fund as 'investments'. Chew, 52, was Amac director in 2007.

Together, the value of the three 'round-tripping' transactions totalled $26.6 million.

The other three charged yesterday were Kong's deputy Tan Ye Peng, church finance manager Sharon Tan Shao Yuen and board member John Lam Leng Hung.

All the accused face varying counts of CBT, while those involved in the 'round-tripping' - Tan Ye Peng, Sharon Tan and Chew - were also slapped with four charges each of falsifying the church's accounts.

The prosecution said this was to create the impression that the bond investments in Xtron and Firna had been either fully redeemed, or set off against purported advance rental payments.

Court documents also named other individuals who have yet to be charged:

- Ex-finance manager Serina Wee Gek Yin, 36, who is cited in all the charge sheets;
- The church's assistant accountant Dua Poh Ting;
Mr Hanafi, who is also a director of Xtron.

Ex-finance chief in spotlight
By Ng Kai Ling, The Straits Times, 28 Jun 2012

ONE name has cropped up in the investigations into alleged wrongdoing by some leaders of City Harvest Church - that of Serina Wee.

The 36-year-old, who used to be the church's finance director, has so far not been charged with any crime.

In court documents, however, she is said to have conspired with pastor Kong Hee and four others to siphon money from the church's building fund.

And in the records of the Accounting and Corporate Regulatory Authority, she is listed as the secretary of more than 50 companies - many linked to the church and its leaders.

These include fashion retailers Skin Couture and Ed Hardy and Xtron Productions, the artist management firm for singer Ho Yeow Sun, Kong's wife.

The five church leaders charged yesterday are said to have transferred $13million from the church to Xtron Productions via supposed bond investments.

Church members contacted told The Straits Times that Ms Wee has been an active member of the church for more than 10 years and that she used to manage the church's finances.

She could not be reached at her Upper East Coast home yesterday.

Her neighbours said she lives with her husband, three children and an elderly couple in the three-storey house. One said she had given birth to her third child, a boy, less than two weeks ago.

When contacted, her husband, Mr Kenny Low, also a church member, said she could not come to the phone as she was nursing the baby.

He declined further comment.

Lawyers said that if investigations find Ms Wee to be involved in the cases, she will eventually be charged.

They added that one reason she has not been charged could be that she has just given birth.

Lawyer Lee Terk Yang said: 'I doubt she would get away scot-free if she was involved in the case.'

Donor also received funds from church
By Lim Yan Liang, The Straits Times, 28 Jun 2012

MR WAHJU Hanafi, the Indonesian businessman who allegedly played the roles of both donor and recipient of City Harvest Church funds, had once been described by Pastor Kong Hee as a 'true friend'.

Kong had said that Mr Hanafi had brought him food and helped him through a period of depression when investigations by the authorities first began, churchgoers told The Straits Times.

Mr Hanafi is also listed as one of the owners of Kong's apartment in Sentosa Cove.

While he was not a regular at the church, Mr Hanafi had also shared his life story onstage on at least one occasion before, said a church member. His successes in career and family life had also been featured several times in the church's online newsletter.

Court documents yesterday revealed that $11 million of church building fund monies had allegedly been used to purchase sham bonds issued by PT The First National Glassware (Firna), a company owned by Mr Hanafi.

A press statement released by the Commissioner of Charities on Tuesday also mentioned that Mr Hanafi had donated $600,000 to the church's building fund in 2009, only for that money to be transferred to another account, used improperly to finance the music career of pop singer Ho Yeow Sun, Kong's wife.

Mr Hanafi, who is also the founder of a prominent chain of grocery stores in Papua New Guinea, remained elusive yesterday.

When The Straits Times visited his Aspen Heights apartment, an Indonesian maid who answered the door said Mr Hanafi used the address only to register his businesses and has never stayed there.

Instead, it is the residence of his elderly father-in-law, whom he last visited in January.

At his second address, a Sentosa Cove apartment a few blocks away from Kong's, a woman who answered the intercom said Mr Hanafi was 'not available'.

When asked if Mr Hanafi knew that his name and company was mentioned in court yesterday, the woman said Mr Hanafi had 'no comment'.

Financial dishonesty contrary to teachings: Churches' council
Bishop urges S'poreans not to react against churches; netizens take sides
By Chong Chee Kin, The Straits Times, 28 Jun 2012

THE Christian community avowedly disapproves of any misuse of funds, including any money raised by or given to churches, the National Council of Churches of Singapore said yesterday.

Speaking to The Straits Times, the council's sitting president Terry Kee said dishonesty in financial matters is clearly contrary to the teachings of the church.

The Lutheran Bishop was contacted for his comments in the wake of the arrests of City Harvest Church founder Kong Hee and four senior church members.

He added, however, that as the matter was before the courts, it was important to avoid speculation or pre-judgment, and that the legal process should be allowed to take its course.

The council counts major Christian denominations and churches here among its members.

The bishop said: 'We appreciate the clarification by the Deputy Prime Minister and Minister of Home Affairs that the charges filed by the Commercial Affairs Department (CAD) are against the five individuals, not City Harvest Church itself.'

He also sought 'the understanding of fellow Singaporeans', urging them 'not to react against the church or churches' here.

But react is exactly what netizens are doing, and the matter has touched off a firestorm on social media, with supporters and detractors split right down the middle.

Since the news broke of the arrests, Twitter has been abuzz; at least half the top trending tweets are related to the church and the news of the arrests.

City Harvest Church members have tweeted their overwhelming support for Kong and his wife, with many quoting scripture.

One supporter, Mr Christopher Pang, wrote an open letter to Acting Minister for Community Development, Youth and Sports Chan Chun Sing alleging that the Commissioner of Charities' (COC) statement on Tuesday on the misconduct and mismanagement of the charity was defamatory as those involved had not been charged.

Mr Pang, an executive member of City Harvest, asked the COC to apologise to the church for the 'inexcusable report' and expressed his unhappiness over the suspension of eight people in the church from their roles as leaders, executive members or employees.

The Straits Times understands that the COC can publish a statement of the results of its inquiry as it thinks fit, and that under the Charities Act, it has the power to mete out suspensions or remove board members.

Church leaders have decried the various comments on both sides of the divide.

In an e-mail to the Christian Post, an online Christian newspaper here, Reverend Dr Daniel Koh, a lecturer in pastoral theology and ethics at Trinity Theological College, said that apart from praying, Christians should let the law take its course. Both the negative, unkind remarks made and those offering blind support of pastors and leaders are 'unhelpful'.

Hope International Ministries' Regional Pastor Benjamin Lee also wrote to the paper, calling for Christians to 'watch out for negative and sinful dynamics in our own life' and to 'avoid a judgmental spirit and self-righteousness'.

Meanwhile, all status updates by Kong on Facebook are drawing thousands of 'Likes' and hundreds of comments - supportive and critical - within hours.

Popular blogger, Rockson Takumi Tan, who has not blogged for more than a year, broke his silence with a foul-mouthed rant on Tuesday, declaring that he too wanted to be a religious leader.

Others have taken a more rational tack online. Facebook user Gerald Tan, in a note on his page, wrote: 'Some have misconstrued the CAD investigations as an attack on Christianity or the work of Satan and the devil. Remember, the CAD is not investigating into God... It is not an attack against our faith as we are still free to practise our religion.'

He dared to ask about use of church funds
By Bryna Sim, The Straits Times, 28 Jun 2012

ALMOST 10 years ago, Mr Roland Poon dared to ask whether City Harvest Church was using church funds to fund Ho Yeow Sun's music career.

The question resulted in him having to make a public apology to the church in January 2003. The then-businessman left City Harvest soon after.

Now, the charges filed against five City Harvest church members seem to have vindicated Mr Poon's actions.

When The Straits Times visited Mr Poon's house yesterday evening, his daughter said the 62-year-old was out of town on a mission trip.

Attempts to reach him via e-mail were unsuccessful.

Speaking yesterday on condition of anonymity, a close family friend said that the incident left him shaken.

'He was really traumatised by what happened,' she said.

Mr Poon had apparently been going to City Harvest for a few years when he started to grow uneasy with some of the church's practices.

'He was uncomfortable with the way the leaders would use sermon and worship time to promote Ho Yeow Sun's songs,' the family friend said.

Ms Ho is the wife of Pastor Kong Hee, founder and spiritual leader of the church.

Apparently, Mr Poon began asking questions on how church funds were being used after he had donated large sums of his money towards the construction of the City Harvest building at Jurong West.

But his questions to the church leadership went unanswered, she added. Frustrated, he called up and wrote in to The Straits Times alleging improprieties.

He claimed to have been 'encouraged' by his cell group leader to purchase Ho's albums and that church funds were used for Ho's publicity and promotional campaigns.

He said it was 'unethical' to mix religion with secular matters.

Responding to Mr Poon's allegations, the church challenged him to prove his case.

'They told him that they would sue him if he had no evidence of them mismanaging church funds,' said the family friend. 'He was very frightened by those threats and felt powerless.'

With no proof or support from fellow church members, she said Mr Poon felt hard-pressed and decided to retract all these statements.

He eventually issued apologies in five separate publications, some of which appeared on the same day that the church issued its own reply to the allegations.

The apologies cost more than $33,000. The family friend said yesterday that when Mr Poon said he could not pay for them, an anonymous donor footed the bill.

Mr Kong also asked the congregation to forgive Mr Poon.

After the matter was resolved, Mr Poon left the church but remained a believer. He has since retired and is now worshipping in another church.

'After something like that which affected him greatly, he just wanted to keep a low profile,' said Mr Poon's friend.


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