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AHTC independent panel drags WP to court over ‘improper’ payments, claims almost S$5 mil from party chiefs

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The top brass of the Workers’ Party has been summoned to court by the Aljunied-Hougang Town Council independent panel that was set up to investigate governance lapses and improper payments using public funds in the town council.

The independent panel, which was appointed by the AHTC at the behest of Housing & Development Board, is seeking to claim a total of S$4,790,095.49 in court comprising S$622,593.78 in liquidated claims and S$4,167,501.71 in unliquidated claims.

Workers’ Party chief Low Thia Khiang, party and town council chairman Sylvia Lim and town council vice-chairman Pritam Singh were served a statement of claim yesterday. All three are Members of Parliament for Aljunied GRC.

Other defendants that have been named include former WP Youth Wing executive committee member, Chua Zhi Hon; deputy organising secretary of the WP and WP candidate in Nee Soon GRC in the 2015 General Election, Kenneth Foo; owner of AHTC’s former managing agent firm FM Solutions and Services (FMSS), How Weng Fan; and FMSS.

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The independent panel was set up in February 2017 after audit firm KPMG released a report last year that AHTC had put millions of dollars from public funds at risk of improper use due to governance lapses from 2011-2015. KPMG had flagged payments to the town council’s then-managing agent FMSS as ‘improper’ since the owners of FMSS held key management and financial control positions in the town council at the same time.

The KPMG report asserted that this meant that FMSS effectively approved and made payments to itself using public funds.

Low Thia Khiang, Sylvia Lim and Pritam Singh responded to the court summons, claiming that they have “acted in good faith and in the best interests of the Town Council and our residents” and that they have “not benefitted a single cent” from their dealings with FMSS.

The MPs released a joint statement on the matter today:

1. We confirm that we have received the Statement of Claim filed by the Aljunied-Hougang Town Council against us individually.
2. We have engaged M/s Tan Rajah and Cheah to defend the claim for the 1st to 5th Defendants.
3. In the suit against us, amongst other things, it is alleged that:
(a) We have acted in breach of our fiduciary duties and duties of care and skill owed to AHTC.
(b) We set up a faulty system which allowed the appointment of FMSS and made it possible for FMSS and/or their officers to benefit themselves.
(c) We entered into contracts with architects in breach of duties owed to AHTC.
4. Our reply to all these allegations is NO.
5. We are taking legal advice and will contest the lawsuit and lay out our case vigorously in court.
6. We wish to make the following points:
(a) Low Thia Khiang and Sylvia Lim have been asked to give an account of profits made from the appointment of FMSS or pay damages not less than $1.25 million. We have not benefitted a single cent.
(b) Sylvia Lim and Pritam Singh have been asked to pay damages of $2.8 million for the wrongful appointment of architects.
(c) The WP MPs have acted in good faith and in the best interests of the Town Council and our residents.
(d) In the course of these proceedings, we will be furnishing more information so that all concerned will be clearer on the issues and why we made the decisions and acted as we did.
Low Thia Khiang
Sylvia Lim
Pritam Singh

AHTC filed a writ of summons regarding a breach of fiduciary duty in the High Court last Friday. A pre-trial conference has been set for 31 August 2017.

The independent panel is chaired by senior counsel Philip Jeyaretnam, and includes senior counsel N. Sreenivasan and KPMG managing partner Ong Pang Thye. Interestingly, Philip Jeyaretnam is the younger son of late opposition politician J.B. Jeyaratnam who led the Workers’ Party from 1971 to 2001.

Philip’s elder brother, Kenneth Jeyaretnam, is an opposition party chief himself. He is the secretary-general of the Reform Party and contested in the 2011 and 2015 General Elections.

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