Defense team established today that the Xtron bond subscription was commercially justifiable and had been drafted by a reputable law firm, and that no church funds were used to repay Wahju Hanafi’s creditors.
In this afternoon’s session, senior counsel Kannan Ramesh took the court through Xtron’s financial schedules in addressing the prosecution’s attempt to prove that the funds used to cover Xtron’s losses came from the church.
During his cross-examination of Xtron director Choong Kar Weng, Kannan, who represents Sharon Tan, presented detailed financial calculations from the same spreadsheet DPP Ong used yesterday, showing that no church funds were used to help Wahju Hanafi and his friends fulfill Xtron’s obligations to CHC under the Advance Rental License Agreement or ARLA.
Furthermore, at the time of the execution of the ARLA, CHC was still considering various property sites for acquisition; as Kannan put it, “all options were still on the table”. Suntec Singapore was only one of these options and there was no confirmed site yet. As such, Choong agreed that there was a logic or reason that underpinned the execution of the ARLA, namely, to secure a place of worship.
Choong also agreed that there needed to be ample commercial justification for Xtron to undertake the bond subscription.
All the elements were present for such a justification: conservative cash flow projections, the on-the-ground advice of Sun Ho’s US manager Justin Herz, Ho’s established pop presence in Asia and the financial support of Wahju Hanafi and various other individuals, some of whom were board members, showed that it made full commercial sense for Xtron to take on the Crossover Project.
It had to be, in the words of Kong Hee in an email to Herz, “absolutely doable”.
In response to an email query from Kong Hee in 2010, Choong told Kong that there was no dishonesty in the Xtron bond transactions. His understanding was that there would be no criminal breach of trust or dishonesty in a scenario where members gave money to the church, and told the church to invest in property, but the church invested in shares instead. In this case, the key members of the church who were responsible for this would not be guilty of Criminal Breach Of Trust if they in good faith believe that investing in shares was more advantageous.
In response to Kannan’s closing question, Choong said that he did not have any doubt that the bonds issued by Xtron were proper investments done in good faith.
The day ended with Michael Khoo, senior counsel for Chew Eng Han, cross-examining Choong on the Xtron bond subscription agreement—the terms of which was drafted in accordance with CHC’s investment policy. Safeguard measures had been put in place; the BSA was drafted by lawyers from Drew & Napier, a reputable law firm.
Were the Xtron bonds sham transactions? Were these transactions devised by the accused persons in order to divert CHC’s monies to fund Sun Ho’s music career? To both questions, Choong answered no.
The court hearing will continue tomorrow with the remaining defense counsels cross-examining Choong.