Category Archives: Do not stop

Kong Hee, charismatic or fraudster?

Photo: Straits Times

Photo: Straits Times, Kong Hee in the middle.

There has been some ruffled feathers in the City Harvest Church after their leader and founder has been found guilty of fraud 20th Nov 2015 in Singapore. He will serve 8 years in prison and has taken with him, 5 of his trusted followers. It all boils down to the question, did he use the Church’s money to fund his wife’s singing career illegally or not? The Judge was clear, it was an illegal use of church funds and handed down a harsh prison sentence on him. A rich man to live in a Singapore prison for 8 years is certainly a challenge, I understand that there is no air-conditioning or TV neither is there exercise more than 1 hour a day, there are no beds, inmates sleep on the floor.

Now the verdict has been handed down after a 2 year trial and review of thousands of files. As noted by the ABC news:

After a two-year trial that captivated Singapore with tales of lavish spending and financial deceit, pastor Kong Hee and five aides were found guilty of diverting $Sg24 million (A$24 million) to finance his wife Sun Ho’s music career, which was portrayed as a religious mission.

The six were also found guilty of misappropriating another $Sg26m from City Harvest Church to cover their tracks, prosecutors said. (http://tinyurl.com/poyswvo)

Now is the time to consider the question: is Kong Hee an Arrogant Fraudster or a Likeable Fraudster? And a very interesting case he is too. He is certainly liked by the thousands of churchgoers, but Likeable Fraudsters upon discovery confess to their wrongdoing and never plead ‘not guilty’. They also show a deep and real remorse, so deep that they consider that they are unworthy to live and commit or attempt to commit suicide. This too is missing in the news reports.

Kong Hee does say that he is sorry to his congregation, this was captured by mothership.sg on video.

I am so sorry for all the pain and the turmoil you have had to endure under my leadership, under my watch. You have had to answer questions, and criticisms from family, from friends, from colleagues. Pastor is so very sorry. So so sorry. That you have to endure through all these under my leadership. (http://mothership.sg/2015/10/here-was-how-kong-hee-said-sorry-to-the-city-harvest-church-congregation/)

But is this a real apology? Where is the admission of guilt? And what about saying sorry that the $26 million which has been spent, will be returned? Nothing. In fact, this is not a real apology. Reason why? He only apologises to the poor congregation who have been dragged through the limelight by the media. What does a real apology contain? Taking full responsibility of the wrongdoing! That it was wrong and it will never be done again.

In my view, what is happening with this apology is that the congregation was expecting a not guilty verdict and he had to do something to assuage their feelings yet stay in control. In other words, this is not the behaviour of a Likeable Fraudster. I am left with the conclusion that Kong Hee must be an Arrogant fraudster. This will be an unpopular decision with his congregation but not with the whistle-blowers, Chew Eng Han, who was the person who thought up the scheme of how to siphon off funds, and Roland Poon Swee Kay, who blew the whistle on Kong Hee’s behaviour – 12 years ago, and I gather most of the Singaporean community.

And to rub salt into the wounds of the congregation, the acting Pastor ends the apology speech with this.

Thank you Church, I just want to collect God’s tithes and offering. I want to thank you for your love for City Harvest Church… you see there is an envelope that look like this, I want you to just take it out, and put your offering inside, and you can, if you are making a cheque make it payable to ‘City Harvest Church’, I want to encourage you to fulfill your tithe, your building fund. Thank you for your giving, thank you for your love towards City Harvest Church. God loves you, let’s give with a big wide smile. Amen? Praise God. (ibid.)

Photo: Straits Times

Photo: Straits Times

Interestingly Kong Hee has put his penthouse apartment up for sale in July of this year, for Sg$10,000,000. But nothing is mentioned about where the proceeds will go. Kong Hee has been reported to have knocked back offers. It is a jointly financed deal with an Indonesian developer Wahju Hanafi.

A Likeable Fraudster would have accepted anything and repay the debt owed, even though it is far less than was misappropriated.

One thing that I have learnt from this case is that the Arrogant Fraudsters Executive Impression Management can hold tremendous power over many people and rely on their stunning image of success that has worked for them for years, to use again for the future.

Amen.

 

 

 

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Filed under Arrogant Fraudster, Creating successful image, Do not stop, Selling stolen assets

Andy Fastow: A Smartest Arrogant Fraudster in the Room about to be released

Mr Fastow of Enron fame, jailed for 10 years and forfeiting $23.8M in assets in 2006 is about to be released from prison next month. The date is anticipated is the 17thDec 2011, after serving most of his time in a low-security prison and more recently a halfway house prior to his release.

Originally faced with a maximum of 140 years in jail, he received lenient sentencing thanks to some good plea-bargaining based on informing on his colleagues (notably Kenneth Lay and Jeff Skilling) at Enron.

Interestingly, Fastow was the only executive fired by the Enron Board just days prior to the collapse due to the Board finding out that he made $45M for himself in his off balance sheet deals. Apparently the Board thought his financial wizardry as excessive. So not only has he been able to receive a lighter sentence he gets to keep at least $20M of his fraudulently obtained money.

From what I have researched in the media it would seem that Andy Fastow would fit the type of Arrogant Fraudster.  It was said about him long ago that his critics:

‘…labeled him ”fast Andy” and the ”Betty Crocker of cooked books.” People who grew up with him judged him as extremely ambitious and recall how he quarreled with high school teachers over his grades.

Former Enron colleagues have called him prickly and a bully. They say that during angry bouts, he was known to leave profanity-laced messages on the voice mail of colleagues.

He could also be charming and generous, former colleagues said. (reported by David Barboza, 2002). His drive for power was noted very early on in school with these comments:

”High school politics wasn’t a big deal at our school but it was a big deal to him,” said Mark Liss, a classmate at New Providence High who beat him in a race for class president. ”I remember how depressed he was; student government meant everything to him.”

A year later, Andy Fastow was elected president of the student council…. Dwight Boud, [his English teacher] described Andy Fastow as a ”wheeler-dealer” who even negotiated to get his grades changed. (Barboza, 2002). He married an heiress to a large fortune in 1985, which gave him a platform to meet wealthy and influential individuals and was head hunted by an executive recruiter (nameless unfortunately), as one of Jeff Skilling’s first recruits. He became the mastermind behind the schemes that defrauded millions of dollars out of Enron into the pockets of Enron executives, including his own.

Apparently he was able to show convincing signs of remorse to the trial judge and this assisted in his lower sentence.

From the findings of the Arrogant Fraudster type there are indeed some parallels with corporate psychopathy. Lack of remorse is seen as one of those characteristics, however I found in my research that they tended used remorse at trial to reduce their sentences. Most times the judges in the cases would see through the mitigation attempts by the fraudster and it would be remarked upon in their judgements that the ploy did not work.

So it could still be argued that Fastow demonstrated signs of being a corporate psychopath by being able to persuade an experienced trial judge such as Ken Hoyt the US District Judge in attendance at the trial, despite the remorse shown.

The ability to charm people is one of the noted characteristics of psychopaths, even fooling Robert D. Hare the well-known psychologist who has studied imprisoned psychopaths for over 30 years who admits that even he has had the wool pulled over his eyes. This uncanny ability to charm is how the individual is able to succeed in pulling off frauds of this magnitude. Anyone else would fall apart with keeping up the charm, but not Mr Fastow, he managed to beam the charm to the right quarters for 11 years at Enron and this is despite the constant cry that his efforts to keep Enron afloat went unrecognised.

Fastow was part of the Enron dream team of the smartest guys in the room, Skilling may have had the vision, but it was Fastow who admitted giving them the means to implement the vision.

Psychopaths do not change, their unrelenting behaviour is meant to be able to be harnessed (Snakes in Suits) with their immense energy put into side projects. This may happen to Andy Fastow upon his release, that he may undertake projects that he feels will be satisfying. However, generally such satisfaction is grounded in their own needs being fulfilled and with a psychopath it is the need of power over others. Certainly the Arrogant Fraudsters in my research went on to repeat their offending behaviour even while on bail, convincing new employers that they were much maligned.

The outlook for Fastow would seem to be the same pathway as before, set in his early days of seeking power, perhaps it will be moderated to some degree, but more likely that we will be hearing more about Andy Fastow after his release. As they say in the media, “Watch this space…” it will be very interesting to see how this Arrogant Fraudster develops after his stint in prison.

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Filed under Arrogant Fraudster, Do not stop, Psychopathic

Fraudsters are unstoppable

Unfortunately executive fraudster do not stop until they get caught.

Once they are found out they are stopped. But do they ever stop before being caught? My opinion is that they continue until they have bled the company dry then they transfer to find the next victim company. Even if they realise that they are close to being discovered they continue on with their nefarious activities.

My article at SSRN outlines the reasons for my assertions based on my recent research about executive fraudsters.

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