City Harvest Church (CHC) members may have discussed matters involving Xtron Productions, a music production house that managed Sun Ho's career, but the final decisions were always made by Xtron's directors, the court heard yesterday.
Xtron director Choong Kar Weng, cross-examined by the defence for the first time since he took the stand on Monday, told the court that no decision of Xtron's could be taken without its directors' approval.
His testimony yesterday, however, seemed at odds with the evidence he tendered earlier in the week; on Monday, under examination by the prosecution, he said he left certain decisions relating to a $13 million bond issue that Xtron made to CHC - such as when the bonds should be drawn down - to CHC member and former finance manager and board member Serina Wee.
Yesterday, under cross-examination by Senior Counsel Kenneth Tan, who represents CHC board member John Lam, Mr Choong said all Xtron decisions had to be approved by him and/or fellow Xtron director Koh Siow Ngea.
Mr Tan asked: "While the prosecution's case is that there are several people in City Harvest Church who may be involved in discussions to make proposals to Xtron, that doesn't mean that the City Harvest Church runs Xtron because there is a need to have any proposals that they make approved by a director or by the directors of Xtron?"
"That's correct," Mr Choong replied. "I need to understand the matter that they propose. I need to evaluate Xtron's position, to see what is good. I will also, on a personal basis, think about the objective of the proposal, and whether it benefits the church, or at least will not cause any harm to Xtron."
He added that he has also modified or disagreed with proposals made by the church. An example of this involved CHC's decision to have Xtron buy a $17.55 million property at The Riverwalk on the church's behalf.
"I remember (CHC) pastor Tan (Ye Peng) spoke to me over the phone about using the advance rental to purchase Riverwalk. I didn't feel comfortable. I wrote an e-mail to Pastor Tan. Subsequently, (former CHC board member Chew) Eng Han also called me to explain that position about using advance rental. I didn't feel comfortable at all.
"After that, they took what I said into consideration and they changed it to the bonds instead - Xtron issuing bonds to raise the funds to purchase Riverwalk," he said.
Mr Choong also testified that he believed the bond issue made commercial sense to Xtron, while also representing an investment opportunity for the church.
Under questioning by Senior Counsel Kannan Ramesh, CHC finance manager Sharon Tan's counsel, Mr Choong said he had no doubt that the bonds issued by Xtron were "proper investments".
He also agreed that there was a "significant alignment of interests" between CHC and Xtron, but that this was not synonymous with the church "controlling" Xtron.
Senior Counsel Michael Khoo, who represents Chew, asked Mr Choong: "Were these bond transactions devised by the accused persons, the six of them sitting in the dock, in order to conceal the diversion of the church's Building Fund monies to fund Sun Ho's music career?"
"No, not in my opinion," said Mr Choong.
He added that the church's Crossover Project was "never about Sun (Ho)'s personal music career", and that it was "really the church's project".
CHC pastor Kong Hee, deputy senior pastor Tan Ye Peng, former board member Chew Eng Han, board member John Lam, finance manager Sharon Tan and former finance manager and board member Serina Wee, are accused of criminal breach of trust for allegedly misusing some $50 million of the church's funds to promote Ms Ho's music career through an elaborate series of round-tripping and sham bond transactions. Chew, Wee and the two Tans have also been charged with conspiring to falsify accounts.
It is the prosecution's case that $11.4 million of CHC's building funds was purportedly "invested" in a Special Opportunities Fund (SOF) managed by Chew's company, AMAC Capital Partners (Pte) Ltd.
This was "round tripped" to "redeem" bonds issued by The First National Glassware (Firna), by AMAC lending the monies to Ultimate Assets, a company owned by Indonesian businessman Wahju Hanafi; Ultimate Assets in turn lent the monies to Firna, another of Mr Hanafi's companies, and Firna then purported to redeem the Firna bonds originally issued to CHC as part of the sham bond investments.
Another $12 million in CHC funds was supposedly paid out to Xtron as "purported advance rental", but this "rental" was instead used by Xtron to purchase $11.5 million worth of Firna bonds.
This sum was then said to be used by Firna to repay the loan it received from Ultimate Assets, which in turn used this money to repay the loan it previously received from AMAC. AMAC then "redeemed" CHC's purported investment in the SOF.
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