SINGAPORE: Prosecutors have charged that the six City
Harvest Church leaders accused of misusing church monies "intentionally
deceived" the management board and its executive members. They alleged
that this was done by deliberately concealing information about the bond
transactions to disguise the fact that they channelled money from the
church's building fund.
The prosecution said the church board and its members were never told that the S$13 million in Xtron bonds were meant to finance the church's Crossover Project. The project is the church's way of evangelising through secular pop music, and is fronted by Kong's wife Sun Ho. Xtron was Ms Ho's artiste management firm at the time.
Kong said his team may not have shared the information about the bond proceeds being used to finance the Crossover Project because they did not see a need to. He said he would have if he knew of any "legal obligations" to do so, adding that "whether we share it or we didn't share it, all financial transactions between City Harvest Church and Xtron must be legal and legitimate".
The prosecution added that Kong and his deputies had also hidden from the church board and executive members the true purpose of a S$21.5 million amended bond subscription agreement, which the church entered into with Xtron in 2008. This was a way to buy Xtron more time to repay the bonds, and to cover up the fact that the original S$13 million had already been spent on the Crossover Project, the prosecution charged.
Prosecutors said the church board and members were given the false impression that Xtron would use the entire bond proceeds from the amended agreement to buy a Riverwalk property that would then be leased to the church.
In reality, because the S$13 million had already been spent, Xtron only received a fresh injection of S$8.5 million from the church. That meant it had to take a loan for the remainder of the purchase price of the Riverwalk property.
The prosecution then pointed to an email from Mr Roland Wee - brother of the church's former finance manager and accused Serina Wee - as evidence of how the church had been kept in the dark about this even up till 2010. Mr Wee had highlighted some concerns about Xtron's financials, which Serina Wee then forwarded to her co-accused - deputy senior pastor Tan Ye Peng, and the church's former investment manager Chew Eng Han - saying: "I couldn't tell him that Xtron Productions had taken a bank loan for the Riverwalk purchase."
The prosecution also turned to the church's investment in bonds issued by Firna - a glassware company owned by Indonesian businessman and longtime church member Wahju Hanafi. It charged that the Firna bonds were - like the Xtron bonds - a sham to channel the church's building fund monies to finance the Crossover Project, and that Mr Hanafi was simply acting as a "conduit".
Deputy Public Prosecutor Christopher Ong charged that it was Kong and his team who controlled the drawdown of the bonds and how the proceeds would be used. Mr Ong pointed to the emails which he said reflected Kong's frustration with the delay in his instructions regarding various payments being carried out. "Mr Hanafi had no control over the proceeds of the bonds, except for the parts that were allocated for his own use," he charged.
Kong refuted this, saying the funds had been "earmarked" by Mr Hanafi under the Firna bonds, to be used for the Crossover Project: "Wahju had pledged them for the Crossover album production and that's why we held him accountable to the commitment." He added that the Firna bonds were not a sham and that its structure would never have been carried out without the sanction of lawyers and auditors.
The hearing will be resuming on Sep 8, when Kong will continue to be cross-examined. After that, his co-accused and the church's finance manager Sharon Tan is expected to take the stand.
The prosecution said the church board and its members were never told that the S$13 million in Xtron bonds were meant to finance the church's Crossover Project. The project is the church's way of evangelising through secular pop music, and is fronted by Kong's wife Sun Ho. Xtron was Ms Ho's artiste management firm at the time.
Kong said his team may not have shared the information about the bond proceeds being used to finance the Crossover Project because they did not see a need to. He said he would have if he knew of any "legal obligations" to do so, adding that "whether we share it or we didn't share it, all financial transactions between City Harvest Church and Xtron must be legal and legitimate".
The prosecution added that Kong and his deputies had also hidden from the church board and executive members the true purpose of a S$21.5 million amended bond subscription agreement, which the church entered into with Xtron in 2008. This was a way to buy Xtron more time to repay the bonds, and to cover up the fact that the original S$13 million had already been spent on the Crossover Project, the prosecution charged.
Prosecutors said the church board and members were given the false impression that Xtron would use the entire bond proceeds from the amended agreement to buy a Riverwalk property that would then be leased to the church.
In reality, because the S$13 million had already been spent, Xtron only received a fresh injection of S$8.5 million from the church. That meant it had to take a loan for the remainder of the purchase price of the Riverwalk property.
The prosecution then pointed to an email from Mr Roland Wee - brother of the church's former finance manager and accused Serina Wee - as evidence of how the church had been kept in the dark about this even up till 2010. Mr Wee had highlighted some concerns about Xtron's financials, which Serina Wee then forwarded to her co-accused - deputy senior pastor Tan Ye Peng, and the church's former investment manager Chew Eng Han - saying: "I couldn't tell him that Xtron Productions had taken a bank loan for the Riverwalk purchase."
The prosecution also turned to the church's investment in bonds issued by Firna - a glassware company owned by Indonesian businessman and longtime church member Wahju Hanafi. It charged that the Firna bonds were - like the Xtron bonds - a sham to channel the church's building fund monies to finance the Crossover Project, and that Mr Hanafi was simply acting as a "conduit".
Deputy Public Prosecutor Christopher Ong charged that it was Kong and his team who controlled the drawdown of the bonds and how the proceeds would be used. Mr Ong pointed to the emails which he said reflected Kong's frustration with the delay in his instructions regarding various payments being carried out. "Mr Hanafi had no control over the proceeds of the bonds, except for the parts that were allocated for his own use," he charged.
Kong refuted this, saying the funds had been "earmarked" by Mr Hanafi under the Firna bonds, to be used for the Crossover Project: "Wahju had pledged them for the Crossover album production and that's why we held him accountable to the commitment." He added that the Firna bonds were not a sham and that its structure would never have been carried out without the sanction of lawyers and auditors.
The hearing will be resuming on Sep 8, when Kong will continue to be cross-examined. After that, his co-accused and the church's finance manager Sharon Tan is expected to take the stand.
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