CHC trial: Lawyers and auditors aware of “unusual plan”, no red flags raised (Today: 31 Jan 2015)

SINGAPORE — While admitting that he was the sole author of a plan to channel funds into audio-visual firm Xtron Productions to acquire a site to house City Harvest Church (CHC) and redeem bonds, the church’s former investment manager Chew Eng Han said he had proceeded only when given the legal green light.

He even shared the plan, involving a series of financial transactions through multiple entities, with the CHC board so as to get its blessing, Chew told the court today (Jan 30). “I wanted to be more accountable.”

Chew, 54, is among six church leaders, including CHC founder Kong Hee, accused of misusing S$24 million of church building funds to buy sham bonds in two companies to boost the music career of Kong’s wife, pop singer Ho Yeow Sun.

One of these two companies is Xtron, which manages Ms Ho.

Another S$26.6 million of church funds was then allegedly circulated through complex transactions — which the prosecution refers to as “round-tripping” — to cover up the first amount.

Chew told the court he had also consulted lawyers and auditors on the plan to use the church’s bond investments to fund Ms Ho’s pop career, also known as the Crossover Project, which was aimed at reaching out to non-Christians.

“The reaction I got was the same: No problem,” Chew told the court when Senior Counsel Edwin Tong, who is representing Kong, asked if red flags were raised.

Chew added that Kong and his deputy Tan Ye Peng, also one of the accused, had on multiple occasions requested him to seek professional assurance for the plans.

In the investment market, Chew said, there are fine lines between taking risks, recklessness and criminal negligence. “Kong Hee, in his attempt to want to make this project successful, could border between just taking calculated risks and recklessness,” he said in response to Tan’s lawyer N Sreenivasan, who had noted Chew’s “careful” choice of words.

Earlier this week, Chew told the court that he realised only in recent years that Ms Ho’s singing career had been boosted by the church’s bulk purchase of her albums.

However, Mr Tong argued today that Ms Ho’s albums had topped the radio charts in Singapore and Taiwan, among others, since 2002 — two years before the buyback plan of her CDs was implemented.

Mr Tong added that Chew was already in the know about the buyback plan as he was part of the CHC board then — to which Chew agreed.