, , , , , , , , , , ,

CityNews reports,

CHC Trial: DPP Questions Ex-Board Member’s Interest In Protecting The Church

The prosecution highlights discrepancies between Chew’s and Lam’s statements to CAD; accuses Lam of making Chew a scapegoat.

This morning, DPP Mavis Chionh once again circled over the “secret letter” signed by John Lam.

In earlier tranches of the trial, the court heard that the Firna bonds transaction between City Harvest Church and Firna Glassware owned by CHC member Wahju Hanafi included a convertibility feature that allowed CHC to own 40 percent of Firna shares amounting to S$23 million, in the event of a default.

In order for the bonds transaction to be completed, Hanafi’s father-in-law had to agree to this convertibility feature. Therefore, a letter drafted by Chew Eng Han and signed by Lam, was given to Hanafi. This letter stated that in the event that CHC acquired 40 percent of Firna shares in a default situation, CHC would sell the shares back to Firna at US$1.

Chionh stated that Lam had given evidence in court that his reasons for signing this “secret” letter ‎was because firstly, Chew, who had handled all the documentation had told Lam that Hanafi had given assurance that this waiver letter was not meant to be enforced. Secondly, Lam was also under the impression that there was absolutely no reason for CHC to trigger the convertibility feature of the Firna bonds.

Chionh said that Lam had given different answers to the CAD about why he signed the “secret letter.” She suggested that Lam had thought it up thereafter to justify why he would sign a letter that appears to not be in the best interest of the church.

She also brought up Chew’s statement to the CAD, which apparently said that the secret letter could be enforced in court. And if the court ruled in favor of Hanafi, CHC would have to then sell the Firna shares back at US$1.

The DPP highlighted that both Lam and Chew had entirely opposing views about the enforcement of the letter. Pitting Lam’s CAD statement against Chew’s, she accused Lam of lying about the non-enforceability of the letter as an innocuous justification for signing the letter. She said that Lam didn’t care about the enforcement of the letter because the Firna bonds were “sham” and used to channel funds to Sun Ho’s music career.

Lam explained to the court that there were two reasons why he signed the secret letter. One is that Firna was assessed to be profitable and the chances of defaulting on the redemption of bonds was low. Another reason is that, instead of converting the bonds into shares, it would make sense to hold the bonds until payment, as Firna is a private company, making it hard to find a buyer for the shares.

Chionh put it to Lam that the convertibility feature was put into the bonds agreement to make it appear legitimate to‎ people outside their “little circle of co-conspirators”.

‎Lam told the court that he was not involved in the documentation of the Firna bonds at all; he was only asked to sign the secret letter.

Chionh questioned why the church’s management board was not told about this letter even though the letter said that Lam was signing it on behalf of the board. Lam replied that he had left it to Chew to do so as stated in an email between Serina Wee, Chew, Lam and Tan Ye Peng.

Court resumed at 2.30pm.

Source: The City News Team, CHC Trial: DPP Questions Ex-Board Member’s Interest In Protecting The Church, CityNews, http://www.citynews.sg/2014/08/chc-trial-dpp-questions-ex-board-members-interest-in-protecting-the-church/, Updated on August 7, 2014 at 3:33 pm. (Accessed 16/08/2014.)