Chan Chun Sing on CHC scandal: Not always possible for governance review to detect fraud

It’s not always possible for governance reviews to detect signs of mismanagement or fraud, Acting Minister for Community Development, Youth and Sports Chan Chun Sing said in Parliament on Monday.

And it is for this reason audits, inquiries and investigations such as the one commenced by the Commissioner of Charities (COC) on City Harvest Church (CHC) in 2010 are “more specific, intrusive and in-depth”.

Chan was responding to a question by nominated MP Laurence Lien who asked why the COC’s review of the megachurch in 2008, along with six other large charities, had not uncovered the lack of compliance with regulations.

“A governance review is not meant to be an audit, much less an investigation or formal inquiry to detect and establish fraud or mismanagement,” Chan said.

Instead, the review serves to help charities improve their corporate standards and is done in cooperation with charities that participate in them.

He added that the reviews in 2008 had found that the seven large charities “generally had proper systems and processes in place” and were “largely in compliance with the regulatory requirements and codes of governance”.

“The inquiry on the church initiated in May 2010 was not triggered by the governance review in 2008, but feedback and complaints on possible misuse of church funds received in early 2010,” Chan stressed.

COC’s two-year investigation ended two weeks ago with CHC’s founder Kong Hee and four other senior members charged for allegedly misappropriating about S$24 million from CHC's building funds for unauthorised use, among other charges.

The funds were believed to have been used to finance the music career of Kong's pop-star wife, Ho Yeow Sun.

Chan said that he would refrain from making additional comments on the case as they may prejudice court proceedings.

With additional reporting by Jeanette Tan