While the verdict pronounced by the court today was disappointing to many, members are assured by the leadership team and church board that have been helming CHC the last three years.
Members of the public queued overnight to get a seat at today’s hearing. CN PHOTO: Michael Chan.
It was easily the most anticipated verdict hearing of the last three years. The drawn-out trial involving six City Harvest Church members, including the church’s senior pastor Kong Hee and deputy senior pastor Tan Ye Peng, came to an end today as presiding judge See Kee Oon delivered his verdict.
The case revolved around the misuse of $23 million of the church’s building funds to finance the Crossover Project via bond investments into Xtron and Firna, and a subsequent misappropriation of another $26 million in a related series of “round-tripping” transactions.
It had been shown in evidence that the church did not actually lose money in these transactions; in fact, the bond investments had been fully redeemed with interest. The defense team also showed that none of the six had benefitted personally from any of the transactions, and that these transactions had been drafted, checked and cleared by the professionals engaged by the church—lawyers from Drew & Napier and Rajah & Tann, and auditors from Baker Tilly.
However, the court noted that the prosecution’s case was not the intent for wrongful gain but wrongful loss to the church.
Addressing the accused in sequence, the court pronounced Lam, who was a board member at the time of the transactions, guilty of the three charges against him for conspiracy to commit criminal breach of trust (CBT). Kong was also found guilty of all three charges.
Pastor Tan Ye Peng, former fund manager Chew Eng Han, accountants Sharon Tan and Serina Wee, who faced between seven and 10 charges of criminal breach of trust, round-tripping of church funds and falsifying of accounts, were also found guilty of all the charges against them.
The court stated that having seen all the evidence presented and weighed the submissions by both the prosecution and defence, he was satisfied beyond reasonable doubt that the use of the building fund to finance the Crossover Project was an unauthorized use.
Additionally, the court was convinced that the six had acted dishonestly; they knew that the building fund was for restricted usage, but conspired to channel it toward the Crossover Project under the guise of the Xtron and Firna bond investments.
He found these bonds to be not genuine investments as the primary purpose was not for financial gain but to finance the Crossover Project.
The six accused did not tell the lawyers and auditors they were relying on for advise that CHC was controlling Xtron, the court said, and any advice they sought was only for self-supporting purposes.
He was also unconvinced that they genuinely believed for Sun Ho’s album sales to be profitable enough for the church to recoup its investments; Ho’s track record of success had been “inflated” by garnering support from within the church, and it was not realistic to expect financial returns from the US album sales.
The court was satisfied that the Advance Rental License Agreement (ARLA) was not a building-related transaction but meant to create the false appearance that the bonds had been redeemed, as were the Special Opportunities Fund (SOF) investments.
The court noted that the motives of the accused, no matter how pure, did not exonerate them from their wrong-doings.
The judge invited both prosecution and defense to make their written submissions for sentencing and mitigation pleas, which will be heard at a later date.
The trial, which stretched 140 days before the verdict hearing today, is one of the longest trials in the history of Singapore. The prosecution put 14 witnesses on the stand, including the financier of the Crossover Project, Wahju Hanafi, while defendant Chew called three witnesses, including Sun Ho, wife of Kong.
In that space of time, Sharon Tan’s former counsel, Senior Counsel Kannan Ramesh was appointed a High Court judge and Kong’s counsel, Edwin Tong, was made Senior Counsel.
“It is not the verdict I had hoped for, so of course I am disappointed. But we have all along put our trust and faith in God that He works all things for good, and we continue to do that,” said Sun Ho, the co-founder of CHC and wife of Kong.
The church will continue to operate as usual, from its weekend services to the running of its 36 ministries, which include missions work, community services and its bible school, the School of Theology.
“Since 2012, a new management and Church Board have been running the operations of the church, without Pastor Kong taking on an executive role—he has focused on pastoral care and preaching, and not been involved in any decision-making function. Although we do miss his input, the church has been running smoothly without Pastor Kong’s involvement. Going forward, this management team and Church Board will still be in charge to take the church into CHC 2.0,” added Ho.
Sentencing has been set for Nov 20 at 930am.
ABOUT THE CASE
The CHC trial began in May 2010 with the investigation of several leaders by the Commercial Affairs Department (CAD). This culminated two years later in June 2012 with the arrest of six leaders for allegedly misusing $23M from the church’s building funds to finance the Crossover Project using “sham” bonds, and for misusing a further $26M to cover it up.
It has been established that the church suffered no financial loss via the bond investments.
Nevertheless, over the course of 140 days of court proceedings spanning three years, the court heard arguments from both sides—with the prosecution seeking to establish that there was dishonest intent on the part of the six to cause loss to the church, and the defense contending otherwise.
A summary of the key points is as follows:
Role of the professionals (auditors and lawyers)
• The accused sought the advice of the professionals on the outward form of transactions, but withheld certain information from them as they did not want them to scrutinise the substance of the transactions, which were the underlying facts showing the bonds to be shams.
• Kong Hee and his team relied fully on the advise of professionals, checking and clearing all the church’s financial transactions with the auditors.
• The auditors and lawyers knew about the bonds and where the proceeds were channeled—into the Crossover Project.
• No red flags were ever raised.
– The accused entered into the bonds knowing that the church would not be able to recoup its investments.
– While there was an initial projection of 200K copies of albums sold, the final projection was 1.5M album copies to be sold, which would mean that Xtron would have no problem fulfilling its liability to the church when the bonds matured.
• The church’s board members were aware that the proceeds from the Xtron and Firna bonds were invested into the Crossover Project.
• The accused also painted the false picture to the auditors that it was an independent entity from the church.
• Auditor Foong Daw Ching advised the accused that so long as there were no common directors sitting on the board of CHC and Xtron, both companies can be considered as independent entities.
• No church funds were lost.
– Albert Jebanayagam, 70s, Canaan Fellowship International Church founder
I am of course very sad. These are the leaders who have obeyed God and gone before us, laying the foundations of CHC for us. Nonetheless, just like what is said in Hebrews 3, “For every house is built by someone, but God is the builder of everything … Christ is faithful as the Son over God’s house. And we are his house, if indeed we hold firmly to our confidence and the hope in which we glory.” Pastor Kong has laid out CHC2.0 for us with the new leadership team and we will support them and continue to stand firm and further the good works that God have started in CHC.
– Rae Lee, 30, HR manager
As a church family, we are pained to see our dearest family members going through this tumultuous period. The anguish of being handicapped of any help to this decision is heart-wrenching. We can only huddle together as family and encourage each other to ride through this.As a long time member of this church, I have always believed that there was no personal gain for any of the accused and what they had done was for the purpose of the Crossover Project and that, was not futile and certainly God was in the midst of it all.
I remain convinced that Pastor Kong and Pastor Tan maintained their integrity and never harbored ill intent for the church nor for the members.
– Josephine Lim, 43, Bank Executive
We believe that God is still for us, for Pastor Kong and his team, and for City Harvest. His ways are higher than our ways. Come what may, we will still be committed to each other in the church, and to our vision and purpose of loving God and loving people.
– Kah Kong Hou, 37, Insurance Agent
I am saddened by the verdict. Nevertheless, my family and I will be faithful because we serve a real God. He has a purpose in this all. As for me and my household, we will continue to dwell in the house of God.
– Rosalind Thor, 43, Educator
中文报道 – 城市丰收审讯：尽管裁决结果不佳，教会依然前进
