Tag Archives: xtron

Ponzi Pastor Playing Pea-and-Thimble with Building Fund Proceeds?

19 Tuesday May 2015

Posted by in C3 & Pringles Associations

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Supporters of Kong Hee, (who is on trial with five of his colleagues on various charges pertaining to the alleged siphoning off of funds from CHC in Singapore), have long been maintaining that CHC suffered no financial loss, since bonds purchased from the company “Xtron” were fully redeemed.

Phil Pringle CHC Kong Hee Cover up

This naturally raises the question:

“From where, exactly, did Xtron obtain the funds to repay CHC, since Sun Ho’s foray into the music industry was a complete flop and her album was never released?”

The answer to this conundrum has been revealed in a post on the CHC confessions Facebook page, wherein a recent post had this to say:

“One of the mysteries of the trial is the accused insistence that CHC did not suffer any loss through all the sham bonds. Now the mystery is finally solved in City News’s own report:

http://www.citynews.sg/2015/04/city-harvest-trial-arla-and-sof-investments-not-sham-maintains-tan/

“Although Xtron had used part of the ARLA to buy up the bonds, Tan explained that it was still obligated to provide the corresponding value for which CHC had paid, which in this case was the use of venue for a pre-agreed length of time. Xtron, on its part, would service this obligation with the expected revenue that was to come from the US album sales.

In essence, AMAC and Xtron were legally bound to compensate CHC for what it had paid.”

But since there is [sic] no US album sales, Xtron won’t have the revenue to service the obligation and [at] some point in time CHC will either have to forgive the obligation or force Xtron into bankruptcy – [in] either case the money is gone.

The same with the SOF with AMAC. The money is gone. CHC can sue AMAC but it is not likely that it will ever recover the money.

So it is not true that CHC has not suffered any loss – it is just that they are kicking the can down the road and sooner or later will have to pay the piper.”

Source: CHC Confessions, CHC Confessions, Facebook, https://www.facebook.com/CHCConfessions/posts/1003161419703235, 07/05/2015. (Accessed 15/05/2015.)

So what has apparently transpired is that since Xtron was unable to repay CHC, those whose scheme had been discovered – and who were desperate to clear the bonds off the books – resorted to an accounting thimblerig.

They simply shoveled more of CHC’s money into Xtron, a portion of which funds Xtron promptly returned to CHC as a repayment of the bonds, including both capital and interest due. Thus the accused have allegedly paid themselves (that is, Xtron) money with which they have subsequently reimbursed themselves (that is, CHC) to falsely convey the impression that Xtron is a profitable business being run at arms-length from CHC, rather than a shell company whose sole purpose is to facilitate the defrauding of CHC members via sham transactions. This practice is known as “round-tripping”, and it is illegal. It is over this matter, among others, that some of the accused parties are now being quizzed in the Singaporean courts. Naturally enough, attempts were made to disguise the ruse: funds that were allegedly round-tripped were referred to by the acronym “ARLA”, which stands for “Advance Rental Licence Agreement” (CW’s take on that is that “A Really Lame Artifice” would have been far more apropos).

Of course, even a novice who knows nothing at all about such things as business or accounting would be able to understand that if a business spends buckets and buckets of money but fails to earn a profit, then a loss has been incurred and there will inevitably be financial pain as a result.

The salient question for C3 adherents is “Does Phil Pringle understand that?”

This is because if he does, one could be forgiven for wondering why he has continued to mindlessly repeat the “No money was lost” mantra when it has long been clear that although Sun Ho spent CHC’s money like water to live the high life in the U.S., she never showed a return to justify the so-called “investment”.

Maybe Phil really is unquestioningly gullible, and he actually believes that no money was lost. Perhaps he would prefer to refrain from inquiring too closely or pondering too deeply, given how uncomfortable the truth would be for him – after all, he is both mentor and friend to Kong Hee, and his own credibility and reputation are very much on the line here.

But supposing we all give Phil the benefit of the doubt, what about the fact that he is supposedly a man of God who has a hot-line to the Most High? Why wouldn’t God have given Phil a “word” regarding the facts surrounding this tawdry affair? How is it that God is allowing his golden-haired apostle to back himself into the tiniest of corners without giving him a heads-up, without even dropping so much as the smallest of hints? Has Phil Pringle become like King Saul? Has he really become estranged from the One whom he purports to represent, and on whose behalf he presumes to speak?

TO PHILIP A. PRINGLE

We know that you read the articles on this site, Phil, even though you have strictly forbidden your followers from doing so.

We also know from our reliable sources inside C3 that you have recently discussed a certain unrelated issue with your “leadership”, and that you explicitly told those same “leaders” that you were unable to broach the subject with the wider membership of your organisation – that the information you gave was for the “leaders’” edification only, and was not for general consumption.

Given that precedent, we would like to know this, Phil Pringle: how much do you really know about Kong Hee’s case?

Have the “leaders” in your movement been apprised of facts to which the tithing drones in the pews have not been made privy? Surely you wouldn’t behave in a deceptive manner, would you? After all, you have been referred to as “Australia’s Pope”; indeed, you yourself have invited people to see you as an angel, and you have even, in all humility, have told people to liken you to the Old Testament prophet Elijah.

It’s all very heady stuff, and quite compelling – there’s no way a man of your caliber, an exulted personage of unimpeachable integrity, would deliberately withhold pertinent information from your followers…. is there? (Particularly since some of those followers have been been inveigled into giving money to support Kong Hee’s legal battle).

If we’ve got the wrong end of the stick, please feel free to comment here and set us straight, Phil; we await your anointed explanation with great anticipation.

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“For nothing is hidden that will not be made manifest…” (Part 2)

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Phil Pringle’s Kong Job At Presence 2014 (Part 1)
Phil Pringle’s Kong Job At Presence 2014 (Part 2) Hillsong “Stands” with C3 & CHC?
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Phil Pringle’s Kong Job At Presence 2014 (Part 4) Kong’s “selfie” sermon.
Phil Pringle’s Kong job at Presence 2014 (part 5): Kong Hee and Phil Pringle Undermining Singaporean law?

Court grills Lam

09 Saturday Aug 2014

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Channel News Asia reports,

Unsold CDs does not mean poor album sales: City Harvest Church member

SINGAPORE: Just because City Harvest Church spent some half a million dollars to buy Sun Ho’s unsold CDs in 2004, that did not mean her album sales were not doing well, said former church board member John Lam in court on Friday (Aug 8).

He was defending his claim that Ms Ho’s success was a reason why he supported the church’s investment into bonds issued by Xtron – her artiste management company. Lam is one of six church leaders accused of using church dollars to buy shams bonds to fund Ms Ho’s secular pop music career.

On Monday, the prosecution pointed out that Lam should have known that far from having a track record of successful albums with high sales, Ms Sun’s albums were losing money, and the church was having to spend large sums of money to buy up the unsold CDs.

He told the court that unsold CDs simply meant there was inventory left behind. After all, Lam said church founder Kong Hee had told the church board that sales of Ms Ho’s album were good. In 2002, Kong also told the church that an earlier album of hers had sold some 150,000 copies, hitting double platinum sales.

Lam said the church board approved the purchase of the unsold CDs in 2004 with the intention of giving them to its overseas ministries and visitors. Lam added that this was a way to grow awareness of the success of the church’s Crossover Project. The project – fronted by Ms Ho – is the church’s way of evangelising through secular pop music.

Earlier in the day, he had also denied being a “rubber stamp” as a director of Xtron. The prosecution has argued that Xtron was not an independent, commercial entity operating at arm’s length from the church. Lam insisted that as an Xtron director then, he would not have signed or approved anything that he did not believe in, even if it was asked of him by the church or Kong.

He explained that he had agreed to a stamp of his signature being made – to be used on Xtron invoices – only because he expected the staff to have verified that these were valid invoices. With Lam’s evidence wrapped up, Kong is expected to take the stand when the trial resumes on Monday.

Source: By Kimberly Spykerman, Unsold CDs does not mean poor album sales: City Harvest Church member, Channel News Asia, http://www.channelnewsasia.com/news/singapore/unsold-cds-does-not-mean/1304350.html, 08 Aug 2014 23:10. (Accessed 09/08/2014.)

Phil’s phoney friends

05 Tuesday Aug 2014

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More disturbing news has surfaced against Kong Hee and his wife. We bring you these two articles that we are sure Phil Pringle does not want you to read.

Channel News Asia reports,

CHC spent half a million dollars buying Sun Ho’s unsold CDs

These and other details surfaced as the prosecution sought to highlight inconsistencies in the testimony of ex-church board member John Lam, who cited Ms Ho’s success as a reason CHC should invest in bonds issued by her artiste management company.

SINGAPORE — Ms Sun Ho was not the successful singer City Harvest Church had made her out to be. Evidence showed that the church had spent about half a million dollars buying her unsold CDs.

The profitability of her artiste management company Xtron was also called into question as the trial involving the church’s leader Kong Hee and his five deputies resumed yesterday.

The six church leaders are accused of misusing more than S$50 million of church funds to buy sham bonds to bankroll Ms Ho’s music career.

Although she had been touted as a big commercial success, lead prosecutor Mavis Chionh said the financial statements told a different story.

In 2004, City Harvest Church spent about half a million dollars buying at least 32,000 of her unsold Mandarin CDs to give to ministries and churches overseas.

These details surfaced as the prosecution sought to highlight inconsistencies in the evidence given by former church board member John Lam.

Lam had cited Ms Ho’s success as a reason for the church’s investment in bonds issued by Xtron. He pointed out that the junk bonds were not necessarily bad ones and added that he had believed Ms Ho’s album sales in the United States would be good enough to cover the obligations of the bond.

However, the prosecution said that as former director of Xtron, Lam would have known it was not a profitable company. For example, its only asset was a laptop and all its other assets were loaned from the church. It did not even have the budget to pay a S$46,000 freight services bill.

The prosecution also pointed out that Xtron was not the independent entity it had been made out to be. For one, Lam and fellow accused Chew Eng Han had agreed to stamps being made of their signatures to be used on Xtron’s invoices.

Ms Chionh said the two were “happy to rubber stamp decisions”, knowing that they were made by Kong and the church and were happy to go along with those decisions.

The court also heard that the bulk of Xtron’s funding came from the church’s members. For example, Indonesian businessman Wahju Hanafi’s donations to the church’s building fund were refunded to him and channelled to Xtron. The building fund pledges and tithes of some other members, including Lam’s, were also diverted to Xtron.

The trial continues.

Source: By Kimberly Spykerman, CHC spent half a million dollars buying Sun Ho’s unsold CDs, Channel News Asia, http://www.channelnewsasia.com/news/singapore/chc-spent-half-a-million/1296604.html, Published 23:49 AM 04/08/2014. (Accessed 05/08/2014.)

Yahoo! Singapore reports,

City Harvest case resumes: S$500,000 used to buy Sun Ho’s unsold music CDs

City Harvest Church (CHC) spent $500,000 to buy Sun Ho’s unsold CDs. This was revealed in court on Monday as the trial involving the church leaders resumed.

According to Today newspaper, lead prosecutor Mavis Chionh said the financial statements of the church revealed that at least 32,000 of Ms Ho’s unsold music CDs were purchased by the church for a sum of S$500,000 to give away to ministries and churches overseas. Sun Ho is the wife of CHC co-founder and pastor Kong Hee. A former student of  Anglican High School and Victoria Junior College, Ho — previously known as Ho Yeow Sun when she was a successful Mandopop singer — began to eye the US pop market in 2003 and had plans to use A-list music stars to launch her career in Hollywood.

Ms Ho’s “commercial success” was also cited as a reason for the church’s investment in Xtron-issued bonds. Xtron was Sun Ho’s artiste management agency although its profitability and who controlled it is currently under question.

Church founder Kong Hee, his wife Sun Ho and former finance manager Serina Wee are among six senior church leaders accused of misappropriating more than S$50 million worth of church fundsto finance Sun Ho’s career as part of a “Crossover Project” — a church mission started in 2002 designed to reach out to non-Christians through music.

Former City Harvest treasurer and board member, John Lam Leng Hung also took the stand on Monday, claiming he had “mistakenly” pumped S$1.2 million into a church-building fund, which was later withdrawn and channeled into funds to develop the musical career of Sun Ho.

Clad in shirt and blazer, Lam, 46, was the first of six leaders to take the stand in the fifth tranche of the mega church’s trial, which  resumed on Monday.

During court proceedings, prosecutor Mavis Chionh produced a 2002 email suggesting that Lam’s “error” was part of a deliberate plan to muddy the paperwork trail before the eventual channeling of funds into the Crossover Project.

In the email between Lam and another accused church leader, Chew said, “We will need to do more withdrawals of BF [building fund] (this time, probably Wahju and myself), and put into Xtron, and Pst Kong will put in some personal cash also…”

This “merry go round” funds as claimed by Lam in another email was initially excluded in meeting minutes submitted to auditors because he was “scared” that the public would “object” the withdrawing from the building fund. It was later added into the minutes signed by Lam. In response to this, prosecutors suggested that Lam had “falsified” the document.

The court also heard that the bulk of Xtron’s funds came from City Harvest church members.

For example, the $1.2 million in question was donated by church member, Wahju Hanafi, the owner of company Attributes Pte Ltd. Lam had initially explained that he had made an “error” when depositing $1.2 million worth of donations, which was originally intended for Sun Ho’s career from the start.

Lam allowed rubber stamping of his signatures

Lam also admitted to allowing stamps to be made of his signature for invoices under Xtron as he would not be “the best person” to verify some of them.

He admitted to this after prosecutor Chionh showed an email from the church’s human resource and administration manager Wong Foong Ming requesting to make signature stamps.

Lam added that Wee was in charge of processing those invoices and had trusted her verification.

The trial continues on Tuesday.

Source: By Nurul Azliah Aripin, City Harvest case resumes: S$500,000 used to buy Sun Ho’s unsold music CDs, Yahoo! Singapore, https://sg.news.yahoo.com/city-harvest-church-leader-john-lam-in-spotlight-for-s-1-2-million–error–100459301.html, Published 04/08/2014. (Accessed 05/08/2014.)

EDIT 09/08/2014 Here are more articles relevant to the case:

CHC leaders accused of doctoring paperwork to back investments

But church board member says backdated meeting minutes were ‘a mistake’

SINGAPORE — The leaders of City Harvest Church (CHC) had planned to falsify paperwork and deceive auditors that the church had assessed Xtron’s bonds to be a good investment, charged the prosecution as the high-profile trial resumed yesterday.

Church founder Kong Hee and his five deputies are being accused of using millions in church funds to buy sham bonds from Xtron and Firna in order to bankroll the secular music career of Kong’s wife, Ms Sun Ho.

Yesterday, the prosecution said the leaders doctored documents so auditors would think the church had considered in July 2008 whether the Xtron bonds could be recovered before the auditors raised the issue on Aug 1, 2008.

For example, the minutes of a church board meeting dated Aug 3, 2008, reflected that CHC’s investment committee had already reviewed and approved the Xtron bonds. But the investment committee only met two days later, on Aug 5.

Similarly, the minutes from that investment committee meeting were backdated to July 29.

A spreadsheet reflecting Xtron’s ability to redeem the bonds, which had allegedly been presented at the Aug 5 meeting, was only created a few days later on Aug 8.

When these anomalies were highlighted to one of the accused, former church board member John Lam, who had seen both sets of minutes and signed off on the church board minutes, he said they were simply “a mistake”.

Lead prosecutor Mavis Chionh disputed that and called it a “deliberate act” to present a certain picture to the church’s auditors — that CHC had considered the recoverability of the bonds before the issue was raised.

Lam had been fully aware of the falsification and deception, argued the prosecution.

She also asserted that the church leaders had not always painted a full picture to its executive members and had sometimes given them misleading impressions.

That was because they did not want members to discover that money that had been meant for church-related matters had, instead, been spent on the Crossover Project. Fronted by Ms Ho, the project was the church’s way of evangelising through pop music.

The court also heard that the leaders had not told the church board that proceeds from the Firna bonds would be used to fund the project, leading them to believe that the bonds were genuine investments that were made purely to gain financial returns.

It was clear Firna, like Xtron, was merely a “conduit” to channel funds to the Crossover Project, charged Ms Chionh. CHANNEL NEWSASIA

Source: Today Online, CHC leaders accused of doctoring paperwork to back investments, http://www.todayonline.com/singapore/chc-leaders-accused-doctoring-paperwork-back-investments?singlepage=true, Published 4:03 AM, 07/08/2014. (Accessed 09/08/2014.)

Channel News Asia reports,

Five City Harvest Church leaders on trial met to discuss their defence

An email chain highlighted by the prosecution in court shows five of six church leaders on trial had met to discuss their defence and later raised concerns on whether they were on the same page about round-tripping charges.

SINGAPORE: Five of the six City Harvest Church leaders had met at least once in 2013 to discuss their defence, according to an email chain highlighted by the prosecution in court on Thursday (Aug 7). The court heard that church founder Kong Hee was not present at the meeting. The leaders are accused of using monies from the church’s building fund to buy sham bonds in Xtron and Firna to fund the secular music career of Sun Ho – the wife of church founder Kong Hee.

In an email, the church’s former investment manager and co-accused Chew Eng Han says he is “convinced” that they are not on the same page regarding the substance of their defence and some of them had shifted their position on what the bonds were actually for.

He adds that he is “disturbed” by this, and that these differences should be discussed when they next meet. Chew was also the one who brought the email chain to the court’s attention. It was admitted after a closed-door hearing on Tuesday.

Another email also revealed that his co-accused – John Lam, Serina Wee, and Sharon Tan had also raised concerns about whether they were all on the same page about the round-tripping charges.

In an email to Chew dated Feb 3, 2013, John Lam wrote: “The 2 girls have a concern. If on the bond issue there seem to be a “different page”, how about the round trip? Are we having the different view as well. Obviously we rather not.” He then suggests a meet-up to discuss this. When initially questioned by the prosecution, he had denied talking to the other accused persons about what should be said at trial.

The prosecution then questioned Lam about why – if he was truly honest – would he be worried about his co-accused taking a different view of the charges.

Lead Prosecutor Mavis Chionh asked: “Do you agree that if you are an honest accused person who is going to go to court and tell the truth… you would not be trying to meet up with your co-accused persons and worrying about their taking a different view from yours on the charges?”

In wrapping up her cross-examination on Lam, Ms Chionh also said that Lam had placed the interests of the Crossover Project over and above his duty as a church board member to ensure proper stewardship of the church’s Building Fund. She also pointed out that Lam knew using the Building Fund monies to finance Ms Ho’s career was an unauthorised use of the funds, and that his keen awareness of this was why he had desperately tried to claim ignorance during the trial.

“It is also because of this guilty knowledge that you are now trying to disassociate yourself from the transactions and instead to push the blame to some of your co-accused, from blaming Sharon Tan, for example, for wrongly recording minutes, to blaming Chew Eng Han, whom you say was responsible for feeding you information,” she said.

Ms Chionh also gave a scathing assessment of Lam’s defence saying that it has essentially been one of “I don’t know, nobody told me, and if they did tell me, they didn’t ask me for advice”. She said given his status within the church, financial expertise, and documentary evidence, his defence is not only “untenable” but “deeply cynical”.

Source: By Kimberly Spykerman, Five City Harvest Church leaders on trial met to discuss their defence, Channel News Asia, http://www.channelnewsasia.com/news/singapore/five-city-harvest-church/1302222.html, Published 07/08/2014 22:25, Updated 07/08/2014 22:26. (Accessed 09/08/2014.)

CHC Trial: Rabbit Holes, Bunny Trails & Faerie Tails?

06 Thursday Feb 2014

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Channel NewsAsia reports,

CHC trial: Audit manager not privy to investment details

The audit manager overseeing City Harvest Church’s accounts testified on Wednesday that she had not been privy to details of bond investments or arrangements the church had made.

SINGAPORE: The audit manager overseeing City Harvest Church’s accounts testified on Wednesday that she had not been privy to details of bond investments or arrangements the church had made.

The court heard from Mdm Foong Ai Fang of Baker Tilly that the six church leaders accused of misusing millions of the church’s building fund had left out details of the investment in Xtron bonds.

Xtron is a firm that used to manage singer Sun Ho’s music career.

The prosecution alleges that it is one of the firms used to cover up the misuse of church funds by Ms Ho’s husband and church founder, Kong Hee, and his five deputies through “sham bond investments”.

Mdm Foong, who was the liaison between the auditing team and the church, said that she had no clue when the bonds were redeemed or that arrangements were made for them to be redeemed.

The prosecution took her through several emails and minutes of meetings, as it sought to prove that the six church leaders provided little or left out key information to mislead auditors.

Source: CHC trial: Audit manager not privy to investment detail, Channel NewsAsia, http://www.channelnewsasia.com/news/singapore/chc-trial-audit-manager/981548.html, 05/02/2014 14:00. (Accessed 07/02/2014.)

Channel NewsAsia further reports

CHC trial: Auditors knew about bond investments, say defence lawyers

SINGAPORE: The defence representing the six leaders of the City Harvest Church on Thursday said that the auditors from Baker Tilly hired to go through the church’s books were kept informed of its bond investments.

The lawyer of accused Sharon Tan, Mr Kannan Ramesh, took the lead in the cross-examination of audit manager Mdm Foong Ai Fang.

Through various email exchanges between the church leaders and the auditors, Mr Ramesh sought to show that the entire auditing team had access to information about the bond investments made by the church, from as early as March 2008.

The church had subscribed to bonds in Xtron, the former management firm of singer Sun Ho, for S$13 million.

The agreement was dated August 17, 2007. In particular, the defence brought up a document where a member of the audit team received a copy of the agreement five days later, on August 22, 2007.

On Wednesday, Mdm Foong had testified she had not been privy to details of the bond subscription agreement.

Another point made by the defence — that auditor Mr Foong Daw Ching, who is also Mdm Foong’s brother, had been the overall in-charge when it came to matters relating to the church and Xtron.

In statements and emails raised by the defence, the court heard that Mr Foong had described himself as the consultant partner to the whole of the church’s group of companies. But when asked, Mdm Foong denied having any knowledge of this.

She added that Mr Foong was not involved in the audits of the church or Xtron.

The defence’s case is that the six leaders had sought professional advice from Mr Foong on the various matters, including the bond investments and that they were approved by the auditors.

It is also arguing that Mdm Foong and her team knew that Xtron had raised funds by selling bonds to the church and that this money went into the production of Ms Ho’s album.

Church founder Kong Hee and five deputies are accused of misusing millions of the church’s building fund to boost the career of Ms Ho, through the use of “sham bond investments”.

Source: CHC trial: Auditors knew about bond investments, say defence lawyers, Channel NewsAsia, http://www.channelnewsasia.com/news/singapore/chc-trial-auditors-knew/983400.html, 06/02/2014 14:07. (Accessed 07/02/2014.)

Lead Auditor Said He Wouldn’t Have Signed Off Church’s Accounts If He Was “Aware Of The Discussions Among The Accused”

26 Sunday Jan 2014

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Channel News Asia reports,

CHC trial: Auditor says wouldn’t have signed off on church’s accounts

The lead auditor testifying in the trial of the six leaders of the City Harvest Church said he would not have signed off on the church’s accounts if he had been aware of the discussions among the accused and would have raised more questions.

SINGAPORE: The lead auditor testifying in the trial of the six leaders of the City Harvest Church said he would not have signed off on the church’s accounts if he had been aware of the discussions among the accused and would have raised more questions.

On Friday, the prosecution sought to rebut the defence’s argument by asking Mr Sim Guan Seng of Baker Tilly about the signing off on the documents.

This comes after the defence sought to show that the prosecution’s case was built on a “piecemeal” approach, where it showed selective information to the witness.

Mr Sim also said on Friday that the amendment of the Xtron bonds would raise a lot of questions.

It is the prosecution’s case that church founder Kong Hee and five deputies misused millions of Building Fund monies to boost singer Sun Ho’s career.

They are accused of doing so via “sham bond investments” in companies like Xtron.

Xtron was the management firm of Ms Ho, who is the wife of Kong.

The trial will resume on Tuesday as both the defence and prosecution sort out some logistics.

Source: By Claire Huang, CHC trial: Auditor says wouldn’t have signed off on church’s accounts, Channel News Asia, Posted 24/01/2014 14:33. (Accessed 26/01/2014.)

CHC Revelations: Poor Explanations Resulted In Resignations

25 Saturday Jan 2014

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The “rats” continue to “jump”.

Channel News Asia reports,

CHC trial: Bond investments “do not make sense”, says auditor

The lead auditor going through the City Harvest Church’s books testified on Tuesday that the bond investments made by the church and some related firms “do not make sense” and had “gone one round”.

SINGAPORE: The lead auditor going through the City Harvest Church’s books testified on Tuesday that the bond investments made by the church and some related firms “do not make sense” and had “gone one round”.

On the stand for the third day, Sim Guan Seng of Baker Tilly was taken through the church’s investments, which were subsequently invested in or loaned to other firms.

These related firms were AMAC Capital Partners, Xtron, Firna and Ultimate Assets.

The church had invested in a “special opportunity fund” (SOF) in AMAC, which was owned by accused Chew Eng Han.

AMAC was the fund manager of the church at that time.

Through documents raised in court, Mr Sim said AMAC then loaned the church’s money to Ultimate Assets, which in turn used the same sum of money and loaned it to Firna, also known as PT The First National Glassware.

Ultimate Assets and Firna are owned by businessman and long-time church member Wahju Hanafi, who testified in the trial previously.

Mr Sim added that Firna then used the same sum to redeem the Firna bond.

He described this as “round one”.

The witness said “the same thing happened” for “round two”, where a similar cycle took place.

In all, the church invested S$11.4 million in AMAC’s SOF in different tranches.

Mr Sim noted the initial sum of S$11.4 million made “one round”.

Mr Sim said adding to the “confusing” transactions was the advanced rental agreement between the church and events company Xtron, which also made “one round”.

Mr Sim told the court that the advanced rental from the church paid to Xtron was used by Xtron to invest in Firna bonds.

Firna would then repay the loan it took from Ultimate Assets and then Ultimate Assets would repay the loan to AMAC.

This made it possible for AMAC to redeem the S$11.4 million bonds bought by the church.

When asked about the significance of these transactions, Mr Sim said it meant that the church started off with an investment in Firna and ended up with advanced rental paid to Xtron in their books.

“Looking at the Excel sheet would lead me to question whether the investments by CHC in SOF… are really investments in the first place or if they are done to facilitate or to help Firna repay the Firna bonds that City Harvest had invested in,” said Mr Sim.

“The amount transferred seems to facilitate that.

“Just looking at this spreadsheet, it seems to be a plan to enable Firna to repay the bond before the end of the financial year. So, that means the SOF investment itself would be a very questionable investment.”

Mr Sim added that this would then raise the doubt that the church and Xtron entered into the advance rental agreement for purposes other than what was represented to him.

The prosecution’s case is that church founder Kong Hee and his five deputies misused millions of the church’s building fund to boost singer Sun Ho’s career.

They alleged that the accused did so through “sham bond investments” in Xtron and Firna.

It is also the prosecution’s case that some of the accused tried to cover up the misuse through what it calls “round-tripping”.

The court heard that the church had previously declared that no money was lost from its kitty.

This is also part of the accused persons’ line of defence.

During the hearing, Mr Sim also said Baker Tilly had resigned as auditors of the church last October.

He said they had conducted their audit for 2010 mid-way and had raised several issues to the management and board but were unable to obtain satisfactory answers, so they decided to step down.

The firm has resigned from Xtron as well.

Mr Sim will be cross-examined by the defence on Wednesday.

Source: By Claire Huang, CHC trial: Bond investments “do not make sense”, says auditor, Channel News Asia, http://www.channelnewsasia.com/news/singapore/chc-trial-bond/961734.html, Posted: 21/01/2014 14:29, Updated: 21/01/2014 23:35. (Accessed 26/01/2014.)

CNA Reports On Current CHC Court Developments

21 Tuesday Jan 2014

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Channel News Asia reports,

CHC trial: Lead auditor takes issue with CHC’s investment in Xtron

SINGAPORE: Some of the financial moves made by the City Harvest Church did not make any sense, said the external lead auditor of the church’s book.

Mr Sim Guan Seng of accountancy firm Baker Tilly took the stand on Monday in the trial of the six church leaders accused of misusing millions of church funds.

Mr Sim said he took issue with the investment in Xtron.

The church had bought S$13 million worth of Xtron bonds initially. This bond subscription agreement was subsequently raised to S$18 million and then to S$25 million.

The revision was to raise enough money for Xtron to purchase a Riverwalk property.

Mr Sim said he thought it was possible for the church to buy the property directly without having to invest in Xtron. He then told the church’s management to check with their lawyers to see if this was possible.

At the time of the purchase, Xtron, which already had S$18 million, borrowed another S$10 million from the bank.

Referring to email exchanges dated August 2008, between accused Serina Wee, Chew Eng Han, Sharon Tan and Tan Ye Peng, the prosecution asked if there was any reason the four would want to hide the bank loan from auditors.

Mr Sim said he was not aware and added that he found it puzzling that Xtron had to borrow money from the bank when it was supposed to have enough cash.

Later in the day, the court heard that the S$13 million had been drawn down before the property was bought.

Earlier on Monday, Mr Sim had told the court he initially had various concerns, chief of which was that Xtron was “not the most financially healthy” company and he wondered why the church would invest in Xtron.

The court also heard that the witness was not aware of several discussions, one of which involves a letter of guarantee made by businessman and former Xtron director Wahju Hanafi, indemnifying Xtron.

Mr Hanafi was in turn indemnified by four others, including church founder Kong Hee and his deputy Tan Ye Peng.

When asked, Mr Sim said he was not aware of these personal guarantees.

He also questioned why these were not disclosed to the auditors.

When told by the prosecution that the guarantee letter was prepared in 2010 but dated 2007, Mr Sim said he was “puzzled by the purpose of this guarantee” when the audit was already over.

Pointing to various documents produced in court, Mr Sim said that it would seem like the bond transactions between the church, Xtron and another firm, Firna, were set up for specific purposes, which would “raise a lot of red flags”.

Firna, a glassware company owned by Mr Hanafi, was allegedly used in what the prosecution calls “sham bond investments”.

Kong and five of his deputies are accused of misusing the church’s building funds through “sham bond investments” to boost the music career of Ms Ho, Kong’s wife.

The trial continues.

Source: By Clair Huang, CHC trial: Lead auditor takes issue with CHC’s investment in Xtron, Channel News Asia, http://www.channelnewsasia.com/news/singapore/chc-trial-auditor-would/960498.html, 20/01/2014. (Accessed 20/01/2014.)

Kong Hee’s Court Case Goes On

14 Tuesday Jan 2014

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The courts have recently opened again for the case. Here are some articles we found that examined the issues in court.

The Straits Times reports,

City Harvest trial: Church funds used as early as in 2001 to fund Ho Yeow Sun’s music career

“City Harvest Church funds were already used as early as in 2001 to fund the secular pop music career of founder Kong Hee’s wife Ho Yeow Sun, court documents showed on Tuesday.

An item in the church’s 2001 audit indicated “cost of production – MTV”. That audit was managed by Baker Tilly’s Ms Tiang Yii, who continued on the stand for a second day as a prosecution witness in the ongoing trial against Kong and five others for varying counts of criminal breach of trust and falsifying accounts.

Ms Tiang was later the engagement partner for the church from January 2006 to June 2007, and for music production firm Xtron from January to December 2007.

Defence counsel Andre Maniam, who represents former church finance manager Serina Wee, argued that Ms Tiang’s awareness of such investments meant it would not come as a surprise to her when told by Wee that the church had invested monies from their Building Fund in $13 million bond purchases in Xtron in 2007 and 2008.

However, in a heated cross-examination earlier by defence counsel N. Sreenivasan, who represents the church’s deputy senior pastor Tan Ye Peng, Ms Tiang insisted that she had not raised any warnings or red flags because Wee had only told her “verbally”, without any corresponding documentation for the church’s 2008 financial year audit.

“We didn’t have the information at the time; it was all preliminary information gathering,” Ms Tiang said. “The agreement that we saw for Xtron’s side did not say where the source of the City Harvest Church funds were from … That’s only verbal representation (for) which we have to seek corroborative evidence.”

Mr Sreenivasan countered: “So if somebody tells you that $1 million has been stolen, as auditor you will wait for corroborative evidence before you do anything?”

Source: By Feng Zengkun, City Harvest trial: Church funds used as early as in 2001 to fund Ho Yeow Sun’s music career, Straits Times, http://www.straitstimes.com/the-big-story/chc-funds-case/story/city-harvest-trial-kong-hee-offered-step-down-minimise-conflict-i, Published 14/01/2014. (Accessed 14/01/2014.)

Today Online reports,

Auditor grilled in trial of City Harvest Church leaders

Auditor knew church funds were being misused to boost Sun Ho’s music career since 2001, defence claims

SINGAPORE — The trial of the six leaders of City Harvest Church continued today (Jan 14) with fiery exchanges between the defence and prosecution during the cross-examination of the church’s auditor.

The defence grilled Ms Tiang Yii on how she tried to distance herself from fellow auditor Foong Daw Ching, who is also a prosecution witness.

Mr Foong had testified in the second leg of the trial. Like Ms Tiang, he was the church’s external auditor.

After much grilling, Ms Tiang agreed with the defence.

The defence also made the point that Ms Tiang had known from as early as 2001 that church funds were used to produce singer Sun Ho’s music album.

Ms Ho’s husband and church founder Kong Hee, along with five deputies, is accused of misusing millions of church funds to boost her career. CHANNEL NEWSASIA

Source: By Claire Huang Jingyi, Auditor grilled in trial of City Harvest Church leaders, Today Online, http://www.todayonline.com/singapore/auditor-grilled-trial-city-harvest-church-leaders, Published 14/01/2014 3:18 PM. (Accessed 15/04/2014.)

Kong To Herz: “Plan As If ‘The Sky Is The Limit’ And Then Work Out How We Are Going To Get The Funds”

29 Sunday Sep 2013

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TodayOnline reports,

Chew the ‘key person’ behind financing for Crossover Project

SINGAPORE — Taking the stand for the eighth and final day yesterday, prosecution witness and City Harvest Church supporter Wahju Hanafi singled out former church leader Chew Eng Han as the “key person” involved in the financing of the Crossover Project to develop singer Ho Yeow Sun’s career.

Wrapping up his re-examination of Mr Hanafi, Deputy Public Prosecutor Tan Kiat Pheng took the Indonesian businessman through the list of the five church leaders — Kong Hee, Tan Ye Peng, Serina Wee Gek Yin, John Lam Leng Hung and Sharon Tan Shao Yuen — who, together with Chew, are accused of making allegedly sham bond investments and misappropriating S$24 million from the church’s building fund for Ms Ho’s career. 

Earlier during the re-examination, he had tried to show church co-founder Kong’s involvement in the financing of the project by pointing to an email from Kong to American music producer Justin Herz in February 2005.

DPP Tan had also pointed out that, in the email, Kong had instructed Mr Herz to “plan as if ‘the sky is the limit’ and then work out how we are going to get the funds” — although Kong’s lawyer had a day earlier sought to show that Kong had given careful thought to the budget for Ms Ho’s career.

Mr Hanafi denied the five church leaders’ involvement in the financing of the Crossover Project, but identified Chew, who was formerly the church’s investment manager, as “the key person” involved. Chew left the church suddenly in June, citing “issues of spiritual and moral significance”.

DPP Tan also questioned Mr Hanafi on apparent discrepancies in his testimony. For instance, while Mr Hanafi had said in the examination-in-chief that he was not involved in the decision-making of Xtron Productions — which managed Ms Ho’s career — between January 2007 and August 2008, he told the court yesterday that “I didn’t say I was not involved in the decision-making”. Mr Hanafi was Xtron Director from June 2003 to July 2008, when the company provided management services to Ms Ho.

Asked to clarify this, Mr Hanafi said: “I can’t remember this that I have mentioned that I was not completely on decision-making.” Pressed by the prosecution, he added: “Some of these questions, you know, I might be cornered and then I answered it.”

Also taking the stand yesterday was prosecution witness Foong Daw Ching, an auditor from Baker Tilly, who was asked about his relationship with the six accused. The court heard that Mr Foong has known Kong since around 1993, but hardly meets him outside of church. City Harvest and Xtron are clients of the firm, and Kong’s personal tax is also handled by Baker Tilly. The court had heard in the previous tranche of the trial that the firm’s managing partner Sim Guan Seng had raised concerns about the money that was channelled to Xtron. Amir Hussain

Source: Amir Hussain, Chew the ‘key person’ behind financing for Crossover Project, TodayOnline, http://www.todayonline.com/singapore/chew-key-person-behind-financing-crossover-project, 12/09/2013. (Accessed 27/09/2013.)

The Information Just Keeps Coming And Coming…

23 Monday Sep 2013

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 The Online Star reports,

Internal panic within City Harvest

The Ren Ci scandal sparked an internal panic within the City Harvest Church, with church leaders frantically trying to ensure that their own investments in church-linked companies were aboveboard, a court heard.

This happened in 2008, about a year after the church had invested S$13mil (RM33.5mil) in Xtron Productions, a music production firm that was managing City Harvest co-founder Ho Yeow Sun’s singing career at the time.

Several of the six church leaders accused of misusing church funds had in fact reached out to auditor Foong Daw Ching and prepared documents about the church’s transactions for him to review.

This was shown through telephone logs and text messages which were produced by the church leaders’ defence team yesterday.

The defence also strongly suggested that Foong had in fact read and discussed one particular document with the accused.

This set out the church’s relationship to Xtron and other companies, as well as the legal risks that the financial transactions could entail.

Foong, who had earlier insisted that he did not recall seeing this document, admitted: “I would have read it and there must have been some discussion.”

Defence lawyers have been trying to prove that Foong gave the accused detailed advice about various allegedly suspect transactions, and that church leaders had followed his advice.

City Harvest founder Kong Hee, who is Ho’s husband, and five of his deputies are on trial for alleged misuse of S$50mil (RM128mil) in church funds. — The Straits Times / Asia News Network

Source: Internal panic within City Harvest, The Online Star, http://www.thestar.com.my/News/Regional/2013/09/19/Internal-panic-within-City-Harvest-Defence-Church-leaders-sought-to-ensure-investments-were-aboveb.aspx, 19/09/2013. (Accessed 23/09/2013.)

Straits Times also reports,

City Harvest trial: Kong Hee offered to step down to minimise conflict of interest

City Harvest founder Kong Hee was once so concerned about possibly bringing harm to the church that he offered to step down from its management board, said defence lawyers on Tuesday during an ongoing criminal trial into him and five of his deputies.

Kong Hee expressed his concerns about a year before a series of investments were made, which the State believes were shams meant to funnel church funds illegally to wife, Ms Ho Yeow Sun’s career. He asked auditor Foong Daw Ching in an email in 2006, whether Ms Ho receiving a salary from church-linked firm Xtron Productions would pose a problem. Xtron was managing Ms Ho’s music career at the time.

“Sun is paid totally from non-CHC (City Harvest Church) sources… (but) I’m personally very troubled as I don’t wish to bring any potential reproach to the church or its various ministry. If there is simply no way out… Sun and I are even willing to resign from the Management Board of CHC, if that would help diffuse the semblance of any conflict of interest on her part,” he wrote.

Mr Edwin Tong, defence lawyer for Kong, also tried to show that Mr Foong the auditor knew more about the investments than he let on. Several of the six accused had written e-mails saying Mr Foong had endorsed or given advice about the investments, although Mr Foong insisted that these were inaccurate.

Mr Tong said it was “incredible” that the auditor did not seem to recall reading any of the emails he had been sent regarding the transactions, given that the church was a “major” client of the firm.

Mr Foong replied that City Harvest’s audit team was led by another person at his firm whom he would have deferred to, and he had his own “heavy” portfolio of clients at the time.

Source: Feng Zengkun, City Harvest trial: Kong Hee offered to step down to minimise conflict of interest, Straits Times, http://www.straitstimes.com/the-big-story/chc-funds-case/story/city-harvest-trial-kong-hee-offered-step-down-minimise-conflict-i, 17/09/2013. (Accessed 23/03/2013.)