Public Prosecutor v Lam Leng Hung and others

• Jurisdiction: Singapore
• Judge: See Kee Oon
• Judgment Date: 21 October 2015
• Neutral Citation: [2015] SGDC 326
• Court: District Court (Singapore)
• Hearing Date: 22 September 2014,07 February 2014,23 May 2013,04 February 2015,05 September 2013,15 May 2013,11 August 2014,15 August 2014,23 September 2014,20 January 2014,07 May 2015,10 February 2014,30 January 2015,05 February 2014,21 January 2014,18 March 2015,10 September 2014,10 September 2015,18 May 2015,17 July 2014,28 January 2014,17 January 2014,19 March 2015,30 September 2014,14 April 2015,15 May 2015,06 August 2014,26 January 2015,04 May 2015,30 March 2015,27 April 2015,06 April 2015,16 May 2013,11 September 2014,17 September 2014,28 April 2015,24 March 2015,03 February 2015,29 August 2013,24 January 2014,18 September 2014,08 May 2015,16 July 2014,17 September 2013,28 January 2015,21 May 2013,26 September 2014,20 May 2013,01 April 2015,08 April 2014,09 April 2015,31 March 2015,06 September 2013,29 January 2014,16 April 2015,23 March 2015,16 March 2015,19 May 2015,02 October 2014,22 January 2014,09 April 2014,14 January 2014,07 April 2015,26 August 2013,29 January 2015,29 April 2015,04 August 2014,19 September 2013,07 August 2014,12 August 2014,17 March 2015,19 September 2014,13 May 2015,20 March 2015,20 August 2014,25 September 2014,16 September 2013,05 August 2014,22 May 2013,20 September 2013,29 September 2014,05 May 2014,26 March 2015,14 May 2015,06 February 2014,11 September 2013,02 February 2015,19 August 2014,08 September 2014,06 February 2015,17 April 2015,20 May 2015,25 March 2015,10 April 2015,14 August 2014,25 August 2014,02 September 2013,18 August 2014,05 February 2015,10 September 2013,14 July 2014,16 September 2014,04 September 2013,22 August 2014,12 May 2015,12 September 2014,21 May 2014,11 May 2015,08 August 2014,24 September 2014,16 January 2014,15 July 2014,09 September 2013,15 January 2014,21 August 2014,15 April 2015,05 May 2015,08 April 2015,02 April 2015,03 September 2013,09 September 2014,27 August 2013,14 September 2015,26 August 2014,13 January 2014,13 August 2014,13 September 2013,18 September 2013,28 August 2013,30 August 2013,15 September 2015,29 August 2014,23 January 2014,06 May 2015,27 August 2014,28 August 2014,27 January 2015,15 September 2014,12 September 2013,18 July 2014,13 April 2015
• Docket Number: District Arrest Case No 23145 of 2012 and others, Magistrate’s Appeal Nos 147-152/2015/01/02
• Plaintiff Counsel: Mavis Chionh Sze Chyi SC, Tan Kiat Pheng, Christopher Ong Siu Jin, Grace Goh Chioa Wei, Joel Chen Zhi'en, Jeremy Yeo Shenglong, Tan Zhongshan and Eugene Sng Yi Zhi (Attorney-General's Chambers)
• Defendant Counsel: Kenneth Tan SC and Soh Wei Chi (Kenneth Tan Partnership) and Nicholas Narayanan (Nicholas & Tan Partnership LLP),Edwin Tong SC, Aaron Lee, Jason Chan, Lee Bik Wei, Kelvin Kek, Lee May Ling and Jasmine Tham (Allen & Gledhill LLP),Paul Seah, Calvin Liang, Ho Xin Ling, Cheryl Nah and Tan Jie Xuan (Tan Kok Quan Partnership),The fourth accused Chew Eng Han in person,N Sreenivasan SC and S Balamurugan (Straits Law Practice), Chelva Rajah SC, Burton Chen, Chen Chee Yen, Megan Chia and Lee Ping (Tan Rajah & Cheah),Andre Maniam SC, Liang Hanting and Russell Pereira (WongPartnership LLP)
• Published date: 16 April 2016

Presiding Judge See Kee Oon: Overview and background

In 1997, a rapidly-expanding church in Singapore sets up a Building Fund (“BF”) in preparation for receiving donations through its “Arise and Build Campaign”. The object is to fund its efforts to accommodate its growing congregation by building a new church building at Jurong West. Church members are given pledge cards and asked to pledge their commitment towards raising funds for the new building. Led by its founding pastor, Kong Hee, who is the second accused, the church subscribes to a professed “cultural mandate” as a key evangelistic tool. This involves reaching out to non-believers through the use of popular music and culture mainly to appeal to the younger generation. This is the broad backdrop for the activities of City Harvest Church (“CHC”) around the time leading up to May 2002.

In time, CHC became popularly-known as one of Singapore’s “mega-churches”. CHC decided to embark on the “Crossover Project” officially in May 2002. Ms Ho Yeow Sun, also known by her performing name “Sun Ho”, was the “ambassador” for the Crossover Project, which was Kong Hee’s vehicle for realising CHC’s vision to engage popular culture for evangelical outreach. Sun Ho, who is also Kong Hee’s wife, was to record secular music compact disc (“CD”) albums, inter alia, in order to influence those who would not otherwise enter a church to listen to a preacher and to encourage Christians in the pop industry to share their own conversion stories and testimonies. The CHC Management Board agreed that the Crossover Project was consistent with the overall objectives of CHC of fulfilling the Great Commission of spreading the Christian Gospel.

Sun Ho’s first music CD albums under the remit of the Crossover Project were recorded and launched in Asia in 2002. In January 2003, allegations of misuse of CHC’s funds to fund Sun Ho’s music career were publicly made by one Roland Poon. These allegations were subsequently withdrawn. A chain of events was set in motion therefrom, with statements being made to CHC members to the effect that “no church funds were ever used” to fund the Crossover Project and promote Sun Ho’s secular singing career or manufacture her CDs. Xtron Productions Pte Ltd (“Xtron”) was then set up in June 2003 primarily for the purpose of managing Sun Ho’s music career. Up to that point, she had been managed by City Harvest Pte Ltd and Attributes Pte Ltd, which were both subsidiaries of CHC.

A decision was made by CHC in 2004 to extend the Crossover Project beyond Asia, to enter the American popular music market. With that decision came associated needs for more funds to support the cost of promoting Sun Ho’s nascent music career in the United States of America (“US”). By January 2007, CHC projected that nearly $20 million in loans would be needed for Xtron to fund the cost of producing two planned US music albums for Sun Ho, comprising $11.24 million for the first album and $8.3million for the second.

A second “Arise and Build” Campaign was launched in August 2005, with the projected aim of raising $160 million at the end of seven years for the BF. This amount was adjusted to $310 million in or around 2010. By then, substantial sums of money from the BF had been channelled into Sun Ho’s US music career. The launch of her US album(s) was however delayed for various reasons.

On 31 May 2010, the Commercial Affairs Department (“CAD”) raided the offices of CHC and other associated entities. Criminal charges were eventually preferred against the six accused persons in June 2012. The issue of how CHC funded Sun Ho’s US album production costs was central to these charges. The accused persons claimed trial to all the charges and elected to be jointly tried. All six accused persons were, to varying degrees and at different times, part of the leadership or management of CHC. They were tried primarily on charges of conspiring to commit criminal breach of trust (“CBT”) as agents by dishonestly misappropriating church funds that had been entrusted to one or more of them.

The case against the accused revolves around a number of financial transactions involving CHC in the years 2007 to 2009. From August 2007 to June 2009, CHC paid $24 million from its BF to Xtron and PT The First National Glassware (“Firna”), an Indonesian company, in order to purchase bonds issued by these two companies. The vast bulk of this sum of $24 million was eventually spent on music production costs for Sun Ho’s planned US album(s). Subsequently, in the last quarter of 2009, CHC placed $11.4 million in two tranches of an investment fund known as the “Special Opportunities Fund” (“SOF”) offered by AMAC Capital Partners (Pte) Ltd (“AMAC”) and paid Xtron about $15.24 million. Most of this money returned to the church by the end of the year after having been channelled through a number of corporate entities, one of which was Firna; it would not be inapt to say that the money had been “round-tripped”. All this is not disputed.

An Agreed Statement of Facts was tendered at the commencement of the trial. This is set out at Annex A. What is disputed is the characterisation of the various transactions in question. The accused persons say that, to their minds and in fact, the bond purchases from 2007 to 2009 were genuine investments and so were authorised uses of the BF, while the transactions in the last quarter of 2009 were either genuine investments or payments made pursuant to an attempt to secure a building for CHC such that they were authorised uses of the church’s money. But the prosecution’s case is that the bond purchases were “sham” investments in that they were mere pretences for directing BF money towards the production of Sun Ho’s music, while the transactions in the last quarter of 2009 were entered into for the purpose of creating the false appearance that Firna was redeeming the bonds that CHC had purchased, and the accused knew this, with the result that there had been a conspiracy to commit CBT.

These transactions gave rise to two broad groups of charges for the offence of conspiring to commit CBT by an agent under s 409 read with s 109 of the Penal Code (Cap 224, 2008 Rev Ed). The first group, consisting of three charges, was brought against five of the six accused persons. These charges concerned the bond purchases from 2007 to 2009, and for convenience they might be called the “sham investment charges”. I should stress that my use of this terminology in no way indicates any pre-judgment of the merits of the case. The second group of charges, also consisting of three charges, was brought against four of the six accused. These charges concerned the transactions in the last quarter of 2009, and for convenience they might be called the “round-tripping charges”.

In addition, a third and final group of charges, consisting of four charges, was brought against four of the six accused. These charges concerned four accounting entries in CHC’s books made in respect of the transactions in the last quarter of 2009. The accused persons say that, to their minds and in fact, these entries are true and accurately reflect the substance of the relevant transactions. But the prosecution’s case is that the entries are false and were made with intent to defraud in that they were designed to conceal the fact that CHC’s money was being round-tripped for the purpose of creating the false appearance that bonds purchased by the church were being redeemed. The prosecution thus formulated these four charges for the offence of conspiring to falsify accounts under s 477A read with s 109 of the Penal Code, and for convenience this group of charges might be called the “accounts falsification charges”.

The six accused persons

The six accused persons are: Lam Leng Hung, Kong Hee, Tan Shao Yuen Sharon, Chew Eng Han, Tan Ye Peng and Serina Wee Gek Yin. They are, respectively, the first to sixth accused. This reflects the chronological order in which they were charged in court in relation to the offences.

It is not disputed that the foremost individual at CHC is the second accused Kong Hee. I shall refer to him by his full name, although he is also referred to as “KH”, “Pastor Kong”, “Reverend Kong” or “Dr Kong” in various forms of correspondence and documents used during the trial. He is the founder and senior pastor of CHC. He was president of the CHC board of directors, also known as the CHC management board – I shall refer to it as “the board” except where the context requires that I identify it as “the CHC board” – during the period in which the material events in this case occurred, which broadly speaking was from 2003 to 2010.

The next person in the CHC organisational hierarchy is the fifth accused Tan Ye Peng, whom I shall refer to as “Ye Peng”, and who is referred to in various documents in a number of different ways including “TYP” and “Pastor Tan”. He is a deputy senior pastor of CHC. He was first appointed to the CHC board in 1995 and remained there from 2003 to 2010, and from 2006 to 2010 he held appointments within the board, in that he was treasurer in 2006 and 2007 and subsequently vice-president until 2010.

Another board member among the accused is Lam Leng Hung, also known as “John Lam”, which is how I will refer to him – he is sometimes referred to as “JL”. From 2003 to 2010 he was either secretary or treasurer on the board. He was also a member of CHC management committees. He was a member of the finance committee from 20 January 2006 to 28 June 2007, at which point it was re-named the investment committee. He continued to be a member of the investment committee and was chairman of the committee from 17 August 2007 to 1 February 2008. He was also a member of the audit committee.

The fourth accused Chew Eng Han also spent some time as a CHC board member. I shall refer to him as “Eng Han”; it might also be mentioned that he is referred to in various documents...