CHC TRIAL: BLACKBERRY MESSAGES SHOW LEADERS TRYING TO 'PLUG A HOLE' IN FINANCES

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A series of BlackBerry messages and emails dated Mar 30, 2010 allegedly show how City Harvest Church leaders had scrambled to "plug" a financial hole before an extraordinary general meeting three weeks later.

These messages were produced in court yesterday, though is not clear what caused the scramble, states a Straits Times report.

But earlier in the trial, prosecutors showed that in 2009, the church's external auditor Sim Guan Seng had raised concerns about the millions which had been channelled to church-linked companies, Xtron Productions and AMAC Capital Partners.

The series of messages on March 30 started with a message from church founder Kong Hee.

7.30am:

Kong sends a BlackBerry message to executive pastor Aries Zulkarnian and AMAC director Chew Eng Han, one of the accused. "Dear guys, if we have an EOGM on April 18, do we have time to plug the hole?"

9.02am:

Chew replies: "It is too tight if we want the actual funds to have been paid."

9.03am:

Kong replies: "Eng Han, when is the soonest possible?"

9.55am:

Chew replies: "Pastor, I am thinking of another way, which may work better and make more sense... will revert by today okay?"

Minutes later, Chew asked accountant Serina Wee, one of the accused, for details on when Indonesian businessman Wahju Hanafi, had stepped down as director of Xtron.

He also asked her if Mr Hanafi had issued a personal guarantee for the bonds issued by Xtron during his time there.

Before 6pm, Wee sent an e-mail to Chew with two personal guarantees attached.

She wrote: "I tried my best but it is really a very technical document. Can you please help to read through and edit as necessary. I dated both Aug 15, 2007 before we first drew down $7 million bonds in 2007."

One of the guarantees was for Mr Hanafi to sign and indemnify Xtron from losses.

The state believes the bonds in Xtron, which managed the music career of Kong's wife Ho Yeow Sun from 2003 to 2008, were a sham.

Instead, the $13 million that the church invested in them were funnelled into supporting Ms Ho's singing career, it is alleged.

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City Harvest Church (CHC) founder Kong Hee and five other church leaders are accused of misusing more than $50 million of church funds through sham bonds. Their defence lawyers are arguing that there was no wrongdoing as the bond investments are common business practices.

But the way the money was channelled through a series of church-linked companies was dishonest, the prosecution countered. The New Paper reports that e-mail and text message exchanges have been highlighted in court to detail the alleged insider knowledge about fund movement among the accused.

For instance, the prosecution pointed to e-mail exchanges from accused Serina Wee, who called investment gains from transactions “our money”, which contradicted Indonesian tycoon Wahju Hanafi’s stance that the funds were under his control. About 100 pieces of digital evidence have reportedly been submitted so far.

Acting on a tip-off, officers from the Commercial Affairs Department (CAD) raided CHC in May 2010. They seized computers and documents from the church’s offices, visited individuals and firms related to the probe and took away records and accounts.

E-mail and messages were scrutinised. They also spoke to Kong and other people involved in handling the church finances. In June last year, CAD officers arrested Kong at his Sentosa Cove penthouse in a predawn raid. Four others were also nabbed around the same time.

The Crossover Project was started in 2002 for Ms Ho Yeow Sun to become a successful pop singer, so she could preach to those who do not usually associate themselves with the church and Christianity. Indonesian tycoon Wahju Hanafi, 53, agreed to sponsor it.

But even after forking out close to half a million dollars to cover Ms Ho’s bonuses and advances for 2006, there was still a shortfall of more than $110,000. So former church finance manager Serina Wee, who is one of the accused, suggested to Kong’s second-incommand, Tan Ye Peng, in a March 2007 e-mail that they approach previous sponsors.

“We can explain to (the sponsors) that because of public scrutiny, we don’t want Xtron Productions(the company managing Ms Ho then) to be seen giving money to her beyond her salary,” Wee wrote in an e-mail. “The directors of Xtron wanted to bless her during her birthday, for example, and since we have individual sponsors, it will look better on Xtron’s accounts if the sponsors indicate they are giving to her personally.”

But big bucks were needed to enlist the who’s who in the US music industry for Ms Ho’s US debut. Ms Ho’s US-based marketer Lisa Ellis felt that having a US$10 million(S$12.7 million) budget to promote the album was “in line with Shakira’s marketing budget (of US$12 million)” and less than Beyonce’s US$17 million.

E-mail exchanges also showed that nearly $700,000 had been pencilled in for Kong’s airfare, as part of a projected $28.6 million plan to promote the album in Asia which could be met through the sale of bonds.
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