Accused lied that Xtron was independent of CHC, says prosecution (Today: 19 July 2014)

SINGAPORE — He had maintained that City Harvest Church and multimedia company Xtron Productions were independent entities, and said the views of the head honcho at an audit firm would prevail over that of the lead auditor for audit matters.

These two counts of evidence — given by former City Harvest Church board member John Lam Leng Hung in court — were yesterday described as lies by the prosecution in its cross-examination of Lam.

Lam, 46, one of six church leaders on trial for misusing church funds, was cross-examined by lead prosecutor Mavis Chionh. She asked him about the church’s relationship with Xtron, which managed the music career of church co-founder Ho Yeow Sun and provided audio-visual services to the church. The accused had channelled S$13 million of its building funds to Xtron through allegedly sham bonds in 2007 and 2008.

Asked why the church board was able to invite members to become directors of Xtron if it was indeed independent of the church, Lam said both had a common objective and that appointments were made with agreement and acceptance.

Producing an email in which former church finance manager Serina Wee proposed in January 2007 that the church pay a marked-up rate for renting Singapore Expo Hall 8 from Xtron, Ms Chionh asked Lam if it was reasonable for a tenant to seek higher rentals from a landlord.

“I will suggest to you … that your evidence about City Harvest and Xtron being two entities that operate independently of each other and at arm’s length is not true,” Ms Chionh said, to which Lam disagreed.

Ms Chionh also pointed to the earlier testimonies of auditors from Baker Tilly — the church’s former audit firm — that an engagement partner’s views should prevail on audit matters.

Lam’s insistence that the managing partner’s views would prevail “is not only wrong, but is actually a lie in the face of all this evidence that we see”, she said, to which Lam disagreed.

Since the trial began, prosecutors have sought to show Xtron was controlled by the church and that the accused had hidden information from their auditors.

Lam, a chartered financial analyst and certified public accountant, agreed that he was highly regarded and trusted by the church leadership. He had held many responsibilities over the years, including chairing the church’s investment committee, but maintained he was an ordinary volunteer.

He faces three charges of criminal breach of trust relating to S$24 million of church-building funds used for allegedly sham investments in Xtron and an Indonesian glassware firm.

He is arguing that he only “popped in and out” of the transactions in question.

The trial resumes on Aug 4 with the prosecution continuing to cross-examine Lam. Church co-founder Kong Hee is expected to take the stand after Lam.