Former finance manager Serina Wee testified today that, in line with his intention to finance the Crossover Project, Wahju Hanafi had asked her to monitor the flow of the Firna bond proceeds. The prosecution has charged the Firna bonds were sham because accused were dictating the use of bond monies.
Were the Firna bond proceeds Wahju Hanafi’s money or “our money” as the defendants called it in emails? This has been a point of contention throughout the City Harvest trial.
Today, Serina Wee, the last defendant to take the stand, echoed what her co-defendants had all said earlier: it was all Hanafi’s money, he could do what he wanted with it.
In court today during her examination-in-chief, the former CHC finance manager and Xtron accountant answered a series of questions about the use of the Firna bond proceeds posed by senior counsel Andre Maniam.
Wee told the court that she had understood from the church’s former fund manager, Chew Eng Han, that after drawing down the bond proceeds, Firna would return Hanafi his shareholder’s loan, and that Hanafi had pledged to use these funds to support the Crossover’s English album. Wee had to give Hanafi instructions on how to transfer the funds because he did not deal with the day-to-day operations of the Crossover Project and needed to know where and when to transfer the funds. She added that her instructions to Hanafi were purely administrative.
Wee also told her defense counsel that when Hanafi gave the first sum of $1.27m to the Crossover back in 2007, he did not specify how the money should be spent but had left it to the Crossover team to allocate the funds. Similarly, for his subsequent giving, he had never indicated how should the funds be used.
So why did Hanafi call it “your funds” and why did the defendants call it “our money” in their emails? Wee explained that these referred to funds that Hanafi had set aside for the Crossover Project—it did not mean that it was not his money. When Chew referred to the funds as “our money”, he meant that it was the Crossover’s money, not any individual’s money, Wee clarified.
As to why she kept tabs on the transactions going in and out of Hanafi’s account with UBS, Wee told the court that Hanafi asked her to keep track of the monies involved for the Crossover. Wee said that Firna’s chief financial officer was doing the same so that Firna could fulfill its legal obligation to CHC.
Wee told the court today that these email discussions about Firna bond proceeds transaction did not affect Firna’s legal obligation to CHC: Firna was still obligated to return the principal sum plus interest to CHC at the end of the day.
Maniam also brought Wee through an email in which Wee and Chew discussed the terms for Firna bond subscription agreement. Wee was concerned that if they required Firna to give CHC their account statement every month, it would be too much work for Firna’s accountants. Yet if this term had been stated in the BSA, Firna would be legally bound to provide the statements and CHC would have to ensure Firna fulfilled its legal obligation. At this point, Maniam reminded his client that the prosecution has alleged that the Firna BSA was just a sham. Wee disagreed, stating that Firna had real contractual obligations to CHC under the BSA.
This afternoon, Wee told the court that although the Firna bond investment was a “friendly deal” as described by Chew Eng Han, she did not think it was a sham.
Neither did she think the amended bond subscription agreement (ABSA) was sham; in fact, she had suggested to increase the ABSA yield from four percent to five to be accountable to the church members, ensuring that the church would reap a fair benefit from the transaction.
The court also saw a document written by Wee putting forth three scenarios for the redemption of the Xtron bonds. Wee had highlighted her concern about the Commissioner of Charities finding out about Xtron’s link to Sun Ho and that $13 million of the church’s money had gone to fund the Crossover Project.
Wee testified she had concerns not because the bonds were illegal, but because she understood the need for the source of funding for the Crossover Project to be discreet.
Maniam also sought to emphasise that it was audit firm Baker Tilly which had initiated the change of audit engagement partner from Tiang Yii to Sim Guan Seng.
The prosecution has suggested that the accused parties painted an inaccurate picture of the church’s investments to its auditors; it has also suggested that the defendants used Foong Daw Ching as a “cover” for their schemes while hiding important details from the actual engagement partner, Sim, by approaching Foong for advice instead.
Wee testified that she believed Sim would have known that the bond proceeds from the first Xtron bond agreement had gone into the Crossover Project. Furthermore, since the audit partner, Foong Ai Fang, had remained the same, Wee believed Sim would have been apprised of the history between CHC and Xtron, key transactions and any audit issues that arose of out those.
The court also saw evidence showing that it was Foong who had advised that the same audit team be responsible for auditing both CHC and Xtron’s books; he had explained that this allowed for a better system of checks and balances since the auditors would be able to see both sides of any transactions that took place between the two parties.
Asked if the CHC parties had ever thought to have different auditors for purposes of separation between CHC and Xtron, Wee said no; they respected what Foong told them.
Court resumes tomorrow at 9.30am.
中文报道 – 城市丰收审讯：黄表示：何清伟请我关注跨界计划资金流向