Serina Wee was in a dilemma.
Xtron had spent close to S$5 million meant for the rental of a Singapore Expo hall on Ms Ho Yeow Sun's singing enterprise.
Now Xtron, which managed Ms Ho's music career from 2003 to 2008, needed money to cover the rental fees.
The firm had money elsewhere. City Harvest Church (CHC) had bought S$13 million of its bonds.
But the bond proceeds were off-limits and could not be used to pay the rent.
So Wee, who provided accounting services to Xtron, thought of a plan: Use the bond money to pay the rent and disguise its use under a "travelling and salaries" section.
This scenario was put forward by the prosecution yesterday, based on an e-mail sent by Wee to some church leaders.
Wee, CHC founder Kong Hee, and four others, are accused of misusing more than S$50 million of church money through sham bonds.
Some of this money was allegedly used to fund the music career of Ms Ho, who is married to Kong, 49.
During cross-examination yesterday, Chief Prosecutor Mavis Chionh showed the contents of Wee's e-mail - which was dated August 2007 - to former CHC board member John Lam, 46, the first of the accused to take the stand.
She said Xtron had taken S$4.79 million from CHC as advance to rent the Expo hall for church services.
Instead, this money was diverted to fund the expenses for Ms Ho's English albums, Ms Chionh said.
Xtron is one of two companies accused of helping the megachurch's leaders funnel church funds illegally to bankroll the pastor-singer's music career.
Ms Chionh told Lam, who was among the recipients of Wee's e-mail, that Xtron knew it was not supposed to use bond proceeds for rental expenses.
She said: "You, Ms Wee and your co-accused who were in this e-mail thread were aware that this 'Travelling and Salary' costs item that was being inserted by Ms Wee would deceive the lawyers and the auditors."
Simply 'paying first'
But Lam said that he did not see it as a cover-up.
He said that Xtron was just using money that it had to pay first for the album expenses - which included the travelling and salary costs.
"Now that the bond proceeds have come in, it's being used to repay what Xtron had spent earlier on the album. So it's all within the company, it's for them to manage," he said.
He also attempted to clarify that he did not think that the church having to buy Ms Ho's 32,500 unsold Mandarin albums meant that she was unsuccessful. This was brought up on Monday.
"Just because the church agreed to buy the CDs that cannot be sold... (doesn't mean) it is not going to be profitable," he said.
The prosecution also said that Lam had attempted to conceal the CHC-Xtron bond agreement.
For example, Ms Chionh pointed out that he had withheld information about the bond agreement from his fellow CHC investment committee members.
She said he had questioned whether one of them, Mr Charlie Lay, could be trusted with the information, and cited an e-mail by Lam on the need to first "test him out".
Ms Chionh contended that Lam did not tell Mr Lay and another committee member that CHC's fund manager, AMAC Capital Partners, was already investing in Xtron bonds "because these two gentlemen were not part of the same conspiracy that you and Mr Chew (Eng Han, one of the accused) were part of, to use the Xtron bonds as a sham device".
She said: "You didn't want them asking too many questions about Xtron bonds."
Lam said he disagreed. The trial continues today.
About the case
City Harvest Church founder Kong Hee and five others are on trial for allegedly misusing church funds through sham bonds.
This includes S$24 million to fund Kong's wife Sun Ho's music career, and another S$26.6 million to cover up the first amount. They are said to have done this through two companies run by long-time supporters of the megachurch - production firm Xtron and glass manufacturer Firna.
Kong, former board member John Lam, finance manager Sharon Tan, former investment manager Chew Eng Han, deputy senior pastor Tan Ye Peng, and former finance manager Serina Wee, face varying charges of criminal breach of trust and/or falsifying accounts.
Prosecutors had sought to show how Xtron and Firna directors had simply done the bidding of the accused.
Meanwhile, the defence has argued that the transactions were legitimate, with the accused acting "in good faith" on the advice of lawyers and auditors.
This article was first published on August 6, 2014.
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