More to it than meets the eye: the story of
FMSS
The numbers speak loudly enough for
themselves – FMSS and its owners have clearly managed the TC to their own
advantage and profiteered from it. In all, $3 million dollars in salaries, fees
and profits last year– crazy margin - three dollars out of every S&CC ten
dollar spent on the MA is sheer profit and benefits for the 4 owners. What adds
insult to injury is that while they got paid big bucks, they didn’t even
deliver a basic standard of administration and financial system to past muster
under the TC’s own auditors. Four years this went on until the AGO audit
exposed the mess the TC was in. Then Sylvia Lim finally had to step in and try
to clean up the mess.
What is really difficult to comprehend is
Sylvia Lim’s defensive reactions over FMSS. Each time, the TC screwed up –
which means FMSS screwed it up - as highlighted by their own auditors, she will
defend the FMSS with spurious and some plainly, false assertions. When
all else fails, she hide behind the argument that their relationship with FMSS
is purely commercial and the contract was awarded via open tender bla bla bla.
When AGO found a case of FMSS having misled the TC which wound up paying 40 %
more than was rightly the amount, she trivialised it as a mathematical error
and even took personal responsibility as Chairman of the TC for the “mistaken
overcharging” by FMSS. Now when confronted this week with the glaringly obscene
profits that the FMSS owners made off the TC, she dismissed it and declared
there has been no overcharging by FMSS.
The latest distraction she is trying to
throw smoke with is that the Government shouldn’t look into all these things
(even if it involved public monies) and that all this is an abuse of Government
power. Are you kidding? As an elected MP, she has a legal duty to manage the TC
conscientiously and safeguarding the residents interests and monies is at the
heart of that. No different from the Government, namely MND which
oversees the TCs under the TC Act. This duty of the office - of the
elected MP of AHPETC and of the Minister for ND - requires that no stone be
left unturned and that no one looks the other way to find out if residents have
indeed been short-changed and overcharged by FMSS. The public has a right to
know what the hell happened in the 4 years that the FMSS ran the TC, laughing
to the bank but leaving behind such a huge rotten mess brewing under the façade
of efficient enough cleaning services and other visible activities, which lull
residents to believe that everything in the TC is hunky dory.
When you research and trace the facts, the
picture that comes out tells you that there is more to FMSS than meets the eye.
I have no doubt that FMSS was set-up at the initiative of the WP leaders. It
was incorporated on 15 May 2011, 13 days
after the GE; preparation for incorporation – collect/submit forms and getting
lawyers to draw up incorporation documents - probably occurred at least a week
before that. All this happened before CPG spoke to Sylvia expressing wish to
terminate their service as the MA. In an interview reported in Straits Times
(19 Aug 2011), Sylvia revealed that CPG asked to be released from their MA
contract in “late May”
Ms How and her husband, Danny, long time
supporters of the WP, were trusted aides who ran Hougang TC. They managed to put
up almost $500,000 in a jiffy as paid up capital for the new company. And most
telling, the company was set up as a “limited exempt private company” which
means that its annual accounts need not even be submitted to ACRA . Completely
out of public scrutiny.
There was obvious pre-meditation and
strategy by the WP in the formation of FMSS. They had a hand in forming it,
more than they have disclosed. To be fair, they had just won a GRC and were
obviously nervous about trusting the CPG who had been running the TC under the
PAP. They needed to rely on their own people. The FMSS was a WP trusted and WP
aligned entity from the point of its creation. In my view, there is nothing
wrong with what they did, even if they chose to keep it secret. No big deal,
they did what they had to do. This is politics, man.
The story however starts to go bad after
FMSS took over running the TC and ran it to the ground. Ms How, used to being
her own boss under Low Thia Khiang in Hougang, ran AHPETC like the way she ran
Hougang. Sylvia Lim had little control over her even when Ms How behaved in a
rude and disrespectful manner to her - there was little she could do about it.
But the truth it, Sylvia was quite happy not to have to deal with boring,
mundane stuff like running a TC. She had her sights on higher things, they were
on a roll, everyone in the WP was politically high. So no surprise, that in the
same ST interview reported in Aug 2011, she assured that the party can run the
TC and has set aside the first 6 months after the GE to focus on the TC and
after that “ a few months down the road, we will start to think about the next
general election and the new areas we would like to contest”
Four years passed – disclaimers piled up
each year by their own auditor – FKP - as the TC under FMSS couldn’t even
produce a clean set of accounts. I recall that the High Court Judge Quentin Low
said that in another setting, this state of affairs would have led to civil if
not criminal sanctions. What FMSS was guilty of was incompetence and greed.
What Sylvia and her fellow WP MPs were guilty of was negligence arising from
the arrogant belief that running a TC was no big deal. She had assured voters
that the WP can easily run a GRC TC and were ready. She thought she could have the challenge of running
a GRC TC done in 6 months and then just focus on politics.
This under-estimation of the complexities
of a GRC level TC management and over-estimation of the experience and
expertise of FMSS is the root of why things went so wrong in AHPETC. This is
why Sylvia assumed that the PAP’s AIM IT system contract would not be renewed
and never bothered to ask; indeed like FMSS, the WP preferred to have their own
system over which they had total control. Sylvia asked AIM for short extensions
to get her own system going and this was acceded to; she even thanked AIM at
the end of it all. But when things go wrong because of FMSS incompetence (even
manual records got lost and couldn’t be traced), Sylvia blamed AIM. When their
own auditors raised a list of growing disclaimers, Sylvia blamed “handover
issues” implying that George Yeo fixed them up – this was a constant and
tiresome refrain until debunked. The fact is the “handover” of documents and
records was between the CPG and FMSS held under the supervision of the TC with
Sylvia at the helm. Poor Georgie boy had nothing to do with it. I heard that
when CPG left after a proper handing over records with FMSS signing for all
documents received, Sylvia hosted a big makan to thank the CPG folks for
staying back and handing over properly to ensure a seamless transfer. (Sylvia’s
reflex to deflect and blame others seem deep seated.More recently she blamed
deficits in the past to MND withholding their grants – the facts are completely
the opposite! AHPETC TC was in deficit for those years when they had the full
grants (FY 12/13, FY 13/14) and they
reported an operating surplus for FY 14/15, the year when the grant was
withheld!)
When the AGO auditors went in to do a
special audit of the TC , they were horrified to find that the TC’s archival
and record system consisted of a room full of piled up boxes overflowing with
documents. No proper record keeping and many missing records, some
conveniently so for FMSS as related third party transactions were found to be
an issue by the AGO and even later by the TC’s own auditors. What was Sylvia
and her MPs doing during all this time? To be blunt, they had been
sleeping on the job, underestimated the challenge of running a GRC TC and
trusted the wrong people to do it but who screwed them. The only problem is
because the monies are all residents’ monies, the ones who got royally screwed
are the residents of AHPETC and many of them till today don’t even know it.
Sylvia makes a fine speech about the duties
of MP looking after the TC. During the 2011 GE, she assured the voters that she
and her team have the experience to run a GRC TC – no fear. But the truth
is she didn’t bother to spend any time looking after the TC. Hubris led her to
presume that she could just oursource her duties to look after the TC to a
trusted MA like FMSS and focus on cultivating her political ambitions. Indeed I
recall seeing her on stage pleased as Punch when her fellow MP, Pritam Singh
commended her to the rally audience as a political leader with Prime Minister
material (aiyoh ).Some of you may recall it too. (Anyway the bloody PAP
machinery makes sure you don’t forget it by running the footage ad nauseum on
the social media.)
A word on the FMSS people. I know that
there is no love loss between Sylvia and Ms How. Danny who died suddenly has
been a victim of sorts too. By all accounts, he was a nice man and it is really
quite nasty of Sylvia of constantly press him for recovery of monies and when
he agreed, changed her mind to demand for even more. ( A FMSS staff told me
that Danny was a good boss and FMSS a good and fair employer). As a lawyer
Sylvia should have worked through proper legal channels but she wanted to do it
confidentially for political damage control reasons and so she kept putting
pressure Danny personally to cough up more monies on the grounds of
overpayment due to poor service. ( This is completely at odds with Sylvia’s public assertion later that payment
according to contract cannot be overpayment!) Sylvia of course didn’t dare to
deal with Ms How as the fiery woman would probably have kicked her in the groin
( slapping is reserved only for use by WP candidates J).
I have always thought that Sylvia was a
nice damsel and Ms How was the bad egg; but I have revised my view since
researching this story – Ms How is abrasive, hot tempered and cantankerous, a
rough diamond, but what you see is what you get. Sylvia is really a
devious character (maybe politics have changed her) and she has shown herself
to have no compunction to lie in your face. She is of course under great
pressure too because she is left to shoulder this AHPETC-FMSS mess by herself
and some of her fellow MPs have clearly distanced themselves from her on this
issue.
Anyway back to the story: a business
is driven to make profits; it is not a charity. So I suppose one can argue that
there is really nothing wrong for FMSS owners to pursue profits; they are not
obliged to save for the TC. On the other hand, it is the elected MPs whose job
and duty it is to oversee and manage the MA and ensure that they don’t profit
at the expense of the residents. No checks, no balance. The WP MPs failed in
their duty because the buck ends with them – final responsibility for managing
the TC rests with them, the elected MPs.
The Government wants to do a forensic audit
of the 4 years of TC accounts when the TC was run by FMSS. Eventhough Sylvia
has found instances of overcharging and was exposed trying to recover monies
from FMSS privately, she resists any such forensic audit.
I am glad that Sylvia has finally took
charge of TC affairs since Mar this year. But she must stop “protecting” FMSS
in order to exercise political damage control to avoid the public knowing just
how much their friends have screwed them and the residents, right under their
noses for four years.
The PAP is not going to win back Aljunied
this GE. You can bet on it. No need for Sylvia to be so kiasu and kiasi. Do the
right thing even if the truth turns out to be inconvenient politically. Because
in the long run, you will be politically stronger for it.
It is time for Sylvia to take ownership and
not keep on sweeping this FMSS-TC episode under the carpet. Afterall she has
taken the first steps already and have as reported in her latest audited
accounts cleaned up the shit and improved the situation. She cannot pretend not
to have an inkling of what a mess she is left with in the TC, she cannot
pretend that the last 4 years under FMSS didn’t happen. Time to step up and do
the right thing. Do a forensic audit and get it cleaned up once and for all.
“The bottom line is this: We are
responsible to ensure that the town runs well. The managing agent is employed
for their professional expertise, and they have to deliver ….We are quite well
aware of the need to be careful with these monies which come from the residents
and also from government grants. We will definitely want to protect these
monies” (Sylvia Lim, ST 19 Aug 2011)
I believe Sylvia Lim meant these words when she
said them then. Time for her to go back and live by them and stop ducking the
problem.
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