SINGAPORE - City Harvest Church founder Kong Hee once worried about the legality of bonds the church had purchased.
Prosecution witness and Xtron Productions director Choong Kar Weng told the court this on Tuesday, after prosecutors produced an e-mail he had sent Kong, and questioned him over it.
"At the end of March 2010, I received a phone call from Pastor Kong saying he's concerned with all the bonds and all the transactions. So he asked me to check and see whether things were OK," said Mr Choong.
The music production firm is one of two companies accused of helping the six accused to misappropriate church funds to bankroll the music career of pastor-singer Ho Yeow Sun, who is also Kong's wife.
The prosecution believes this was done through sham bonds issued by the two firms which the church invested in, and has been trying to prove that Xtron was nothing but a puppet company doing the church's bidding.
Xtron, however, has maintained it was independent and financially viable.
Mr Choong, the first witness in the second tranche of the high-profile criminal trial, said he dug up more information about the church's dealings after the phone call.
He then wrote the e-mail to Kong on March 31, 2010, saying that in the worst case, the authorities could view the parties involved in the Xtron bonds - City Harvest, Xtron and AMAC Capital Partners, the church's investment manager - as related, and he discussed the possibility of the transactions becoming criminal breach of trust.
"Selling bonds to raise money is not uncommon in business... However, given the close proximity between Xtron and CHC, some people will draw the inference that Xtron is financing (Ms Ho's) albums," he added.
They can get around that problem by saying there was a sponsor for the albums, and Xtron was simply appointed to produce the albums, said Mr Choong in his e-mail to Kong. "This may still be a ground for suspicion but it is very difficult to prove. So legally, I am convinced we are OK here."
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