Wednesday, 25th July 2012
City Harvest Church (CHC) founder Kong Hee and five other CHC members were charged in court for alleged misuse of church funds. Kong, 47, faced three charges for committing criminal breach of trust as an agent of CHC and for allegedly misappropriating about $24 million from CHC's building funds for unauthorised use. His right hand man, Tan Ye Peng, 39, faced ten charges. A church board member, John Lam Leng Hung, 44, faced three charges. The church finance manager Sharon Tan Shao Yuen, 37 faced seven charges. Serina Wee, 35, chruch ex-finance chief and Chew Eng Han, 52, church ex-investment manager faces ten charges each. Each charge carries the maximum punishment of life imprisonment and a fine. The court has allowed Kong Hee to travel overseas for pastoral purposes. His bail was set at S$1 million.
The five were said to have diverted $24 million of the church's building fund to finance the music career of Kong's wife, pop singer Ho Yeow Sun or Sun Ho AKA Geisha. This was allegedly done through a series of sham transactions - namely bond subscriptions, bond redemptions, rental advances, loans, set-offs and book entry accounting, which were made under the pretense of being bond investments in two companies, Xtron Productions Pte Ltd (200305676M) and PT The First National Glassware Ltd (Indonesian Company also known as FIRNA). The prosecution believes that $13 million was diverted to Xtron, with the remaining $11 million of church funds going to FIRNA.
Deputy Public Prosecutor Christopher Ong told the court that not only had they allegedly diverted $24 million through false transactions, some of them had conspired to misappropriate another $26.6 million of church funds to cover it up using the "round-tripping" accounting technique. The prosecution argued it wasn't taking issue with how CHC chose to use its funds as an evangelical tool; rather, it is their case that the manner in which CHC's funds were being used to fund Sun's music career amounted to criminal breach of trust (CBT). Here is the 2010 probe that is connected to this case. Suspicion of fraudulent activities surfaced as early as in 2003.
In its defence, CHC said that money was not depleted from the Building Fund. The chrurch audited accounts show that these funds were actually used to purchase bonds with an interest yield of 7% and were duly redeemed with interest upon their expiry date one and a half years’ ago. So no monies have actually been lost in the Church’s Building Fund, in fact the 7% yield of these matured bonds.
Xtron was founded in 2003 by Chew Eng Han with Serina Wee, CHC's finance manager, as company secretary. Its two shareholders are listed as Koh Siow Ngea and Choong Kar Weng. Xtron is involved in the reproduction of recorded media. The company supplies City Harvest with video and audio equipment and acts on behalf of the mega church in its rental lease agreements.
FIRNA was founded in 1971 and is tableware producer in Indonesia which manufacture tumblers, plates, bowls, astraies, candle holders, cups, mugs, jugs, and also cosmetic bottles and jars. The company is owned by Singapore permanent resident and Indonesian businessman Wahju Hanafi.