City Harvest trial: $11 million 'routed through several firms'

SINGAPORE - WHEN City Harvest Church (CHC) founder Kong Hee (in photo above) and his deputies wanted back the $11 million that the church invested in Firna bonds, the company owner said he did not have the money.

So they allegedly took about $11 million from the church's own investment manager AMAC Capital Partners, routed it through several companies, then put it back into CHC's coffers.

This gave the illusion that the church's bonds in Firna had been repaid, the prosecution alleged on Thursday, in what could prove to be a pivotal moment in the widely watched criminal case against Kong and five of his deputies.

They are accused of conspiring to cheat the mega-church of $50 million partly through sham bonds issued by Firna and Xtron Productions. The money was allegedly used to finance the music career of Kong's wife Ho Yeow Sun and to cover up its misuse.

To back this up, the state on Thursday produced an e-mail from one of the accused, accountant Serina Wee, to Mr Wahju Hanafi, a long-time church member and owner of glassware manufacturer Firna.

In it, Wee outlined how AMAC would finance Firna's repayment of the church's bond money. She even detailed how the money would move from one company to another, and the dates on which the transactions would be done.

Asked whether these transactions had been carried out according to the timeline, Mr Hanafi told the court: "I think it's almost there."

The 53-year-old Indonesian businessman added that the "flow of funds" had been arranged by AMAC director Chew Eng Han, another of the accused.

Chew was a church board member but stepped down when AMAC became the church's investment manager.

"I told them, if you want to do it, you guys just have to provide the flow of the funds, because I cannot come up with the (money)," Mr Hanafi said.

He admitted he did not know why Wee and Chew were eager to have the church's investment in his firm's bonds, which had a maturity of three years, repaid before the first year was up.

E-mail between several of the accused and Mr Hanafi seemed to showed a sense of urgency.

In one message, then church finance manager and one of the accused Sharon Tan told him: "We NEED to keep to the timeline."

The church also invested $13 million in bonds issued by Xtron Productions, the management company once in charge of Ms Ho's career.

Earlier in the trial, Xtron director Choong Kar Weng said he was told by Chew that the church's auditors had grown "uncomfortable" with the bonds it had purchased. Chew then proposed a plan to "restructure" the bonds.

The prosecution also produced e-mail between Mr Hanafi and his wife to try and show that he was aware of trouble within the church.

In a March 2010 e-mail, he told his wife: "CHC has some serious issue from an anonymous person who wrote in and threatened to open up all our connection with Xtron and (Ms Ho's music) project.

"So now they want to find quick cash to pay us so I can pay back AMAC's bond issued to Firna."

A day later he told his wife that he had met Kong. He described the church founder as being "very stressed".

zengkun@sph.com.sg

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