CHC co-accused: Kong Hee was in fear
On his first day making his defence, former City Harvest Church (CHC) fund manager Chew Eng Han wasted no time going on the offensive against his co-accused, particularly his former spiritual mentor and CHC founder, Kong Hee.
Yesterday, Chew, who is making his own defence after he discharged his lawyer last May, spoke for six hours about his and his co-accused's involvement in the church's transactions.
Chew, Kong and four others are accused of misusing millions of church money to fund the music career of singer-pastor Ho Yeow Sun through "sham bonds" invested into two companies - music production firm Xtron and glass manufacturer Firna.
Chew, 54, is the fourth accused to take the stand - after Kong, former CHC board member John Lam and finance manager Sharon Tan.
He left the church in June 2013, reportedly citing "a collision of primarily spiritual and moral principles".
He is also facing a civil lawsuit from the church for $21 million.
This was what he said yesterday:
On May 31, 2010, Chew and his co-accused were called in for questioning by the Commercial Affairs Department (CAD).
The grilling by CAD lasted the whole day, he said. At midnight, they huddled in a meeting room at Conrad Hotel, where they were berated by CHC's lawyer, Mr Jimmy Yim.
Chew told the court: "First, he said to Kong: 'You're going to jail for many years. You're not going to see your son until he grows up.'
"Then at some point in time, he turned to me and said: 'It's all your fault. The bonds are illegal.'"
Chew said he was confident that he had not done anything wrong, but added that he saw that Kong and his deputy, Tan Ye Peng, were frightened.
"When the fire broke out, I didn't see any leaders. The two men I looked up to in church were not acting as shepherds. They were just in fear," he said.
That night, Kong tried to shrug off responsibility by claiming that he did not know about various transactions when asked by Mr Yim, Chew said.
This left Tan's wife fuming.
"She came to me privately and said: 'Why does Pastor Kong say he doesn't know all this? He's the one who asked for it.'
"That was my first wake-up call that something was wrong. Perhaps it wasn't what it looked like after all."
The album production in the US took many years, cost $24 million and involved producers such as Wyclef Jean.
After all that, Sun Ho's English album was never released.
When Kong testified last August, he claimed that it was because of the ongoing CAD investigations in 2010.
Chew, however, felt that Kong should have pressed ahead for the album to be released.
He told the court yesterday: "If Kong really meant… that every dollar invested must go back to the church, and that there were expectations for big sums of revenue to come in, then surely the most logical and responsible thing for him to do would be to finish up the album and launch it."
Chew said that Kong had told him on one occasion that Ho's other producer, Johnny Wright, had asked that she return to the US "so that we can launch you to become the star you deserve to be".
But Kong later said he had deleted the message, Chew added.
"Now in hindsight, I'm thinking, was there ever such a message? Such an important message and he doesn't keep it?"
Chew said that he had worked for the church after he was led to believe that Ho's English album would generate huge earnings to pay back the money sunk into producing it.
OUT OF THE LOOP
As the fund manager, he was merely the person who came up with the bonds, Chew testified.
The real drivers of the Crossover Project, which was CHC's mission to evangelise unchurched youths through Ho's secular pop music, were Kong and Tan Ye Peng, he said.
Chew also presented e-mails in court to prove that he was not involved in the budgeting decisions.
"Tan Ye Peng, Kong and Wee... continually discussed budgets for the album without myself or Lam or Sharon Tan in the loop," he said.
"They thrashed out these figures until... they are quite sure that's the budget. Then they told me $13 million was not enough, and we would need such and such amount of extra bonds.
"The tail end of decisions was where I came in."
If a car malfunctions, you can't just blame the manufacturer, you have to question the user as well.
Chew used this analogy to explain how the bonds he had created for the church were not a "sham", as termed by the prosecution.
"A bond is a loan. A bond is not a sham. It becomes a sham only if the proceeds have been misused," he said, adding that based on his understanding, the bonds were not meant for any personal gain or to cause wrongful loss to the church.
"I did the bonds thinking... there was going to be returns, that the project was valid, the project was legitimate, that Ho had a real track record, and because of her past track record, the chances of her making it for the US album was very, very high."
He said that he was given a "rosy forecast" and he did not think that the church was on an adventure to misspend money.
"I had no reason to think that there were plans to issue bonds up to $22 million with hardly any confidence that the money would be recouped.
"I'd be committing suicide if I had agreed to go in like this. I didn't stand to gain anything. My wife wasn't crossing over. The vision wasn't born by me."
Kong maintained during his testimony that he did not have control over the Xtron directors.
But Chew yesterday said that Xtron was a vehicle set up to achieve the objectives of the church.
And given that millions of church funds were invested in Xtron, it was only prudent that CHC had control of the company, he said.
"There's nothing sinister about Kong and Tan Ye Peng appointing the directors. I don't see anything wrong in that.
"In fact, it's logical and prudent to make sure that money from CHC is properly spent and... doesn't get squandered by the Xtron directors."
Chew added that he could not understand why his co-accused had said that he was the one who started Xtron, especially when one of the first partners in Xtron was Wee's husband.
"I was only a shareholder. Why is everyone so worried to say he or she started Xtron? Is Xtron such a dirty vehicle that no one wants to take responsibility for it?"
With Ho's English album continually being delayed, the Crossover Project required more funding.
So Chew said he sought out glass manufacturer Firna, "a proper business" worth US$50 million (S$67 million).
The owner, Mr Wahju Hanafi, was a long-time supporter of the church and the Crossover Project.
Chew said he even flew to Indonesia and toured the factory, which was the second largest in the country and had Ikea as its biggest client.
After the bonds were issued to CHC, Mr Hanafi would get back money he had lent the company and use it to fund the Crossover Project, Chew said.
"Why would I fly to Jakarta to take a look at a factory, to ask him about his business plans, to ask him about his major clients... or the valuation of his property?
"If it was a sham bond, I wouldn't have bothered to do any of this."
The trial continues today.
ABOUT THE CASE
City Harvest Church founder Kong Hee (above) and five others are on trial for allegedly misusing church funds through sham bonds.
First, $24 million was allegedly used to fund the music career of Kong's wife, Ms Ho Yeow Sun, whose stage name is Sun Ho. Another $26.6 million was then used to allegedly cover up the first amount.
They are said to have done this through music production firm Xtron and glass manufacturer Firna, run by long-time supporters of the church.
Kong, former fund manager Chew Eng Han, former board member John Lam, finance manager Sharon Tan, deputy senior pastor Tan Ye Peng and former finance manager Serina Wee face charges of criminal breach of trust and/or falsifying accounts.
Prosecutors had sought to show how Xtron and Firna directors simply did the accused's bidding.
The defence argued that the transactions were legitimate, with the accused acting "in good faith" on the advice of lawyers and auditors.