Monday, January 13, 2014

City Harvest trial: 3rd leg begins (ST: 13 January 2014)

Witnesses from audit firm Baker Tilly to take stand

THE third leg of the high-profile City Harvest trial starts today as the prosecution continues to build its case against the church's founder, Kong Hee, and five of his deputies accused of misappropriating church funds.

The first prosecution witness set to take the stand is Ms Tiang Yii, an auditor from Baker Tilly, the church's external audit firm.

Other witnesses who are expected to appear in court include church trustee Tan Yew Meng and two other auditors from Baker Tilly. One of the two is Mr Sim Guan Seng, who had repeatedly raised concerns about money that had been channelled to one of the church-linked firms.

This leg of the trial will mainly feature evidence of witnesses from the audit firm, said a spokesman for the Attorney-General's Chambers.

The six church leaders are alleged to have funnelled $24 million meant for the church's new building into sham bond investments in church-linked firms Firna and Xtron Productions.

Church accounts were then reportedly falsified to the tune of $26.6 million so the bonds appeared to have been "redeemed", said prosecutors. This was allegedly done to finance the pop music career of Kong's wife, Ms Ho Yeow Sun.

A spokesman for the church said that the defence has yet to finalise its witness list.

The case will unfold in Court 1 of the Subordinate Courts. For each of the morning and afternoon sessions, 55 seat passes will be distributed to the public outside the courts from 7.15am on each day of the trial. The trial is expected to run until September.

The church has organised nightly prayer sessions at various locations, such as its Jurong West church building. Ms Teo Hsin Yi, a 40-year-old church member, said: "Whatever the situation, we will be standing with our leaders. Since the case started 31/2years ago, they have not stopped serving the church fervently and helping people."



Background Story

The case so far
CHURCH founder Kong Hee and five of his deputies are accused of criminal breach of trust. They had allegedly funnelled $24 million of church funds into sham bond investments in church-linked companies Xtron Productions and Firna to bankroll the music career of Kong's pop-singer wife Ho Yeow Sun, and purportedly taken another $26 million to cover it up.

First leg: May 15 to May 23, 2013
This began with prosecutors questioning church accountants. In one instance, prosecutors showed that two of the accused had unilaterally decided on the interest returns for a bond investment that was different from the original rate, resulting in one of the church's former assistant accountants having to "work backwards" for the accounts to tally.
Deputy Public Prosecutor Tan Kiat Pheng also pointed out that external auditor Sim Guan Seng had raised repeated concerns over the accounts. Prosecutors ended the trial highlighting discrepancies in Xtron documents. They tried to show that Xtron was not independent of the church and that its former director Koh Siow Ngea was merely doing the bidding of the accused.
But the defence said that if the church had directly funded the project, it might have "defeated the purpose" of the Crossover Project, which sought to evangelise via Ms Ho's secular music career, and so the church needed external companies to fund and manage her career.

Second leg: Aug 26 to Sept 20, 2013
This opened with prosecutors painting a more detailed picture that Xtron and Firna were vehicles for the sham transactions. They also tried to show that Xtron director Choong Kar Weng and Firna owner Wahju Hanafi simply rubber-stamped deals.
But the defence sought to show that the transactions were legitimate and that the accused had acted "in good faith" on the advice of auditors and lawyers.
Other witnesses included two church trustees and Mr Foong Daw Ching, whose accounting firm Baker Tilly TFW audited the church.

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