AHTC trial: WP chairman Sylvia Lim gave FMSS heads up about tender, tainting it, says Davinder Singh

Workers' Party chairman Sylvia Lim gave FMSS owners Danny Loh and How Weng Fan a "heads up" to justify their higher rates in an e-mail to them on June 19, 2012, two days before a meeting with the company.
Workers' Party chairman Sylvia Lim gave FMSS owners Danny Loh and How Weng Fan a "heads up" to justify their higher rates in an e-mail to them on June 19, 2012, two days before a meeting with the company.ST PHOTO: KELVIN CHNG

SINGAPORE - Two days before a meeting with the only company that bid for her town council's managing agent contract, Workers' Party chairman Sylvia Lim gave its owners a "heads up" to justify their higher rates.

Those were the words Ms Lim used in an e-mail to FM Solutions & Services (FMSS) owners Danny Loh and How Weng Fan on June 19, 2012, as she encouraged them to provide more details at the meeting.

On June 21 that year, Mr Loh delivered an 11-slide presentation to some members of Aljunied-Hougang Town Council (AHTC) explaining FMSS' pricing strategy.

Senior Counsel Davinder Singh said on Wednesday (Oct 24) - the fifth and final day Ms Lim was on the stand - that the tender process was "tainted and flawed".

FMSS, which was the only bidder, won the tender that was called about a year after the WP won Aljunied GRC in the 2011 general election.

"You colluded with FMSS to make sure that FMSS would come prepared with everything that was needed to secure that bid," Mr Singh charged.

The senior counsel is representing Pasir Ris-Punggol Town Council in a multimillion-dollar suit to recover alleged improper payments from eight defendants including Ms Lim.

 
 
 
 

He noted that one town councillor, Mr Anthony Loh, had asked why FMSS' quote was on the higher side, especially compared to People's Action Party town councils.

"Are they having trouble breaking even or is this purely profit-driven?" Mr Loh had wondered.

Ms Lim replied to his e-mail an hour later, noting that it was a good question, but not before she had e-mailed Mr Loh and Ms How the "heads up", Mr Singh noted.

"These people had been given a tip-off, insider information, so that they could come prepared… to overcome the one difficulty you knew the committee had," he charged.

Ms Lim replied: "Sole tenderer, Mr Singh."

He then asked if there was a difference between a competitive tender and one with just a sole bidder.

"Yes, in the sense that there isn't information being given out to one tenderer and not the others… I wanted them to come prepared so that the meeting would be productive," she said.

But Mr Singh proceeded to read Ms Lim's earlier testimony that in the tender process, she did her best to act with integrity, in the interest of AHTC residents, and with objectivity, dealing with all bidders at arm's length.

"You agreed with me that whether it's a competitive bid or sole tenderer, none of them would have an advantage. Yet you gave FMSS the advantage of the 'heads up' to come fully prepared to defend their pricing," he said.

"It was just a practical matter," she said. "They were the sole bidder. If they had not prepared their answers, they would have to adjourn and come back again."

But Mr Singh asked in what cases where there were multiple bidders would Ms Lim have the authority to "go outside the process" and share additional information with them.

He charged that the process was tainted and she colluded with FMSS to secure their bid.

Ms Lim disagreed.

Mr Singh also put it to Ms Lim that she had withheld information from AHTC's external auditor, and "played with words" to give Parliament the impression that FMSS' ownership structure was disclosed to the town council.

"I suggest to you that someone as artful as you knowingly breached your fiduciary duties - duties as a trustee, duties under the law - just to get your way," he said.

"I acted in good faith at all times," Ms Lim replied.

Mr Singh said: "If this is good faith, then all of us in Singapore are in big trouble."

DEFENCE 'DISINGENUOUS' ABOUT CPG'S ALLEGED CONFLICT OF INTEREST

Mr Singh also took issue with the defence's cross-examination of KPMG partner Owen Hawkes two weeks ago, when the auditor was asked if he knew Mr Jeffrey Chua had an interest in CPG Facilities Management, the managing agent that FMSS replaced.

Mr Chua was the managing director of CPG and the previous general manager of Aljunied Town Council.

Mr Singh asked if Ms Lim was aware, or had bothered to check, that there was a set of town council minutes in 2010 in which Mr Chua had declared his interest.

Ms Lim said: "I mean, this is volume 17 of 36 (bundles of documents)."

He also asked if she knew that Mr Chua's share options were in a parent company, and not CPG itself.

"That's what I understood recently," she said.

He asked if she knew that the shares amounted to 0.015 per cent, or if he had exercised those options.

No, she said.

"What the defendants have sought to do is to disingenuously draw a parallel with Mr Jeffrey Chua - where there was a disclosure of interest but none in the case of FMSS, do you agree?" Mr Singh charged.

After a few minutes of Ms Lim clarifying certain parts of the question in various ways, she said yes.

"So you see, as you have been in giving evidence to this court, in your defence, in Parliament, in media statements, you have no qualms lying," Mr Singh said.

"I will reject that," said Ms Lim.

EXTERNAL AUDIT WAS MERELY 'SUPERFICIAL'

Earlier, Mr Singh posited to Ms Lim that while AHTC had engaged an external audit firm to review the tender evaluation and award of its second managing agent contract in 2012, it was just a "superficial job".

The appointed firm, RSM Ethos, gave an "A" grade in its overall assessment of the process through which AHTC appointed FM Solutions and Services (FMSS) - the sole tenderer - as its agent.

But Mr Singh said that RSM Ethos based its observations only on what AHTC had told them was being done.

Auditors from RSM Ethos were not present in person to do the checks on the town council's tender processes, he added.

RSM Ethos also said in its report that its approach was "not substantive in nature" and it was "not possible to detect fraud or irregularities", Mr Singh pointed out.

Denying that it was a "paper exercise", Ms Lim countered that RSM Ethos sat in during one of the interviews which the town council's tender committee had with FMSS.

"I do not agree that they just produced a report based on what they are told. This is not fair to them," Ms Lim said.

Mr Singh put to Ms Lim that there was nothing in RSM Ethos' report which said that the award of the contract to FMSS was conducted in an "unbiased, objective, fair and transparent" way.

Ms Lim said she would find it in the report, but Mr Singh said he was moving on, and she could bring it up during her re-examination.

'CONFLICTED PERSONS' SIGNED OFF ON AHTC'S PAYMENTS

Mr Singh also charged that Ms Lim relied on "conflicted persons" in the town council - who had stakes in FMSS - to verify that work had been done, and Ms Lim only had a role in tallying amounts and signing off on cheque payments.

Ms Lim said she worked closely with FMSS on a daily basis and was able to access the work they had done.

Mr Singh asked whether she was on the ground, personally checking on their work, to which Ms Lim replied that it was "not a bean counting exercise".

"The question of the protection and safeguarding of the monies was never on your mind. You had abdicated your entire role to conflicted persons," Mr Singh charged.

"That's entirely false," Ms Lim replied.