City Harvest sues ex church leader in $21m lawsuit
He is one of the church leaders involved in a criminal probe against the City Harvest Church (CHC) for criminal breach of trust.
Now, Chew Eng Han is facing a lawsuit from CHC for about $21 million that his investment firm, Amac Capital Partners, allegedly owes the church.
Chew, 54, the sole director of Amac, is also one of the six church leaders embroiled in a criminal trial, in which he is expected to take the stand when it resumes next month.
But Chew, in defence papers filed against the suit, claimed that he was merely an agent of the church in carrying out its "moneylending activities". This, however, was denied by CHC.
The New Paper obtained CHC's statement of claim, filed on Oct 10, and Chew's defence for this latest civil suit, which is fixed for a pre-trial conference next Tuesday. We also obtained CHC's reply to Chew's written defence.
CHC, represented by law firm JLC Advisors, claimed that Amac had approached and solicited it on March 17, 2009, to invest in a special opportunities fund.
In November that year, CHC invested $2.92 million into Amac. It was agreed that the money would be returned three months later with a 1.5 per cent interest, CHC claimed.
CHC also highlighted three other tranches it invested into Amac between November 2009 and May 2010, where interest rates of between 1 and 5 per cent were promised.
But when the church wanted its money back at the end of each of these four particular tranches, Amac could not pay up, CHC claimed.
For example, Amac asked to extend the return date of the first investment by six months.
CHC also claimed that Amac had on two other instances requested for more time regarding all four investment tranches.
The repayment date was extended and the two parties agreed to increase the interest rate on the outstanding amount of about $18 million, CHC claimed.
For example, on Aug 31, 2010, the interest rate for the third and fourth investment tranches was increased from 5 to 7 per cent.
Even though Amac returned some of the outstanding investment money, the total money owed, including interest, amounted to $20.99 million by Oct 7 this year, CHC claimed.
CHC also claimed that Chew had proposed and signed a personal guarantee for the investments. This guarantee was executed on April 30, 2012, said CHC in its statement of claim.
Amac, which was unrepresented, was ordered to pay the $21 million on Oct 22 this year after the firm's non-appearance.
Chew, represented by lawyer A. Rajandran, has refuted most of the claims made by CHC.
Chew: Church aware of risks
I was just a vehicle for the church to carry out its moneylending activities.
That is what Chew Eng Han, 54, has claimed in his defence against City Harvest Church's (CHC) statement that his company owed the church $21 million.
In his written defence, Chew refuted the claims made by CHC.
He said he was merely an agent of the church and he denied liability for the investments.
Chew also said that the CHC board was fully aware and kept informed of the investments as well as of the risks involved.
He also denied that he had solicited the church to invest in Amac Capital Partners' special opportunities fund. Instead, he said CHC had participated with the full knowledge of the risks involved.
He also claimed that about $12.2 million was to be loaned in four tranches to a Mr Akihiko Matsumura of biotech firm Transcu Group, which has since changed its name to OLS Enterprise.
The interest for one of the tranches, Chew claimed, went as high as 25 per cent for the duration of that loan.
Chew also claimed that $350,000 was loaned to former CHC investment committee member Charlie Lay on the instructions of CHC deputy senior pastor Tan Ye Peng.
'LETTERS OF COMFORT'
As to why there were extensions to the repayment of the church's money, Chew claimed that it was the borrower who could not repay the loans.
In CHC's statement of claim, the church said that Amac had provided documents stating the firm's debt to the church. But Chew claimed that these were merely "letters of comfort" to appease the church.
He also claimed that the personal guarantee that he had signed for the investments was just to comfort the CHC board.
"(CHC) only required... so as to give assurance to the members of the board that all was in order in respect of the loans," Chew said, adding that he was promised that the personal guarantee would not be enforced.
He claimed he had always acted in good faith and in the best interest of the church and had merely been following instructions and directions set by CHC.
But in CHC's filed reply to Chew's defence, the church claimed that it was never in the business of moneylending and that the money placed in Amac were not loans but commercial transactions with guaranteed returns.
CHC also claimed that it had relied on its investment manager's advice and expertise concerning the investments, and did not give any directions or instructions.
It said that once it had invested the money, it did not have any more control over the use of the funds.
CHC also denied having any contact with Mr Matsumura and claimed it was not aware that money had been loaned to him.
About the case
Six City Harvest Church leaders, including its former fund manager Chew Eng Han and church founder Kong Hee, are accused of misusing millions of church funds.
First, $24 million was allegedly used to fund the music career of Kong's wife, Ms Ho Yeow Sun.
Another $26.6 million was allegedly used to 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, Chew, 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.
Lam, Kong and Sharon Tan had testified earlier this year.
Chew is expected to take the stand when the trial resumes on Jan 26 next year.