Sharon Tan maintains her testimony that auditors had visibility of Xtron’s and the church’s books, as the prosecution attempts again to show that the defendants tried to mislead the auditors.
Sharon Tan stood by her testimony during cross-examination today. CN PHOTO: Daniel Poh.
This afternoon, deputy public prosecutor Mavis Chionh continued her offensive against City Harvest finance manager Sharon Tan on the topic of minuting board meetings.
When questioned by the DPP today, Sharon Tan said that there was no issue with her recording down the fact that Xtron was the church’s vehicle to secure a commercial building, and that she had received direction from the church board not to minute down details about how the Xtron bond proceeds were to be used.
Sharon Tan explained that the information was of a sensitive nature as the board wanted to remain discreet about the financing of the Crossover Project.
While the board meeting minutes wouldn’t include this information, Sharon Tan told the court that it would be recorded in the church’s investment schedule, and that the church’s audit firm Baker Tilly was aware of how the bond proceeds were used. She also said that the meeting minutes were eventually approved and signed off by the board secretary.
The prosecution asked why it would be sensitive to reveal information that Xtron—as a commercial entity independent from the church as several of the accused have testified—used the bond proceeds to fund the Crossover Project.
Sharon Tan replied, repeating her testimony from last week, that although the Crossover Project was the church’s project, it was imperative to keep it “secular” in order to protect its evangelistic purpose. Hence, the board wanted to take the “discreet” approach.
The DPP theorized that Sharon Tan’s real reason for not minuting down the purpose of the Xtron bond proceeds was “out of fear” of the auditors looking in it and discovering it to be a “sham” investment. The defendant disagreed, stating, again, that the auditors had visibility of Xtron’s books as well as CHC’s.
The prosecution then attempted to illustrate its round-tripping allegations by using an analogy: A had $10 in her left pocket and $10 in her right. One day, she loaned the $10 in her left pocket to B. However, B did not have the $10 to repay A when it was due. If A took the remaining $10 from her right pocket and gave it to B, who then returned it to A’s left pocket, would the initial $10 loan be considered repaid?
Tan answered yes, explaining that B had to “work for it” and earn the $10. The exchange deteriorated into a convoluted scenario involving housecleaning and $10 work assignments before senior counsel for Tan Ye Peng, N Sreenivasan, stood up and objected to the nature of the analogy put forth, followed by the judge stepping in and stated he had problems with the analogy to begin with. It ended with Sharon Tan agreeing that if no work had been done for the $10 that A gave to B to repay his loan, then there would have been no repayment for the loan.
The DPP worked to establish that the accused parties had faked the redemption of the $11m Firna bonds by sending more of its own money to Firna via the guise of a Special Opportunity Fund investment so that it could repay the church the $11m.
The prosecution also submitted new evidence in the form of BlackBerry messages between Tan and the church’s former fund manager Chew Eng Han. Chew was the director of AMAC Capital Partners Pte Ltd, the firm responsible for managing the SOF investments.
In what seemed to be a discussion about the availability of church funds to be invested into the Special Opportunity Fund, Sharon Tan had noted there would be a “problem” because the church’s auditor at the time, Sim Guan Seng would be made aware that the money went to Firna and want to know why. Chew had responded that Xtron would “buy over” the contract for Sun Ho from Ultimate Assets and not Firna; therefore Sim would not know the link between UA and Firna.
The whole point of the exchange, the DPP accused, was that Sharon Tan was worried about Sim finding out that the advanced rental CHC paid to Xtron under the ARLA would be used to “redeem” the Firna bonds.
Sharon Tan disagreed and sought to explain that the “problem” she was worried about was that the SOF proposal would not adequately address the audit issues Sim was concerned about in the first place: disclosure and related party transactions.
The DPP said, “What we see here in these messages is that you and the other three accused were anxious about Mr Sim finding out where the money would go to in the advance rental transaction and the SOF investments … you were going to try to do your best to make sure he did not find out the truth.”
Sharon Tan replied, “Your Honour, we don’t need to wait for Mr Sim to find out where the money would go to in terms of the advance rental transaction, because he audit both CHC and Xtron books … in regards to SOF, yes, your Honour, my concern was with regards to disclosure, not that this is a illegitimate transaction,” was Tan’s reply.
Court resumes at 9.30am tomorrow.
中文报道 – 城市丰收审讯：财务经理重申：审计师对CHC与思创帐目完全知情
