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Tuesday, 6 October 2009

SUNSHINE EMPIRE TRIAL: Trio enriched themselves

THE Sunshine Empire would not have survived for long as its business model was flawed, a district court heard on Monday.

That did not bother the firm's founder James Phang Wah, former director Jackie Hoo Choon Cheat, and Phang's wife, as they were merely out to enrich themselves, said the prosecution.

In his opening statement at the trial opening, Deputy Public Prosecutor Aedit Abdullah noted that Sunshine collected more than $180 million through the sale of lifestyle packages that included personal and beauty health care products. Participants were offered generous rebates in excess of the amount they paid.

Some $118 million was spent on these rebates and incentives to push the purchase of more packages, but much of the rest allegedly went into the pockets of the trio, who have denied the charges.

Phang, 49, is believed to have collected some US$5 million (S$7.05 million) in consultancy fees and allowances between August 2006 and November 2007. Sunshine also made loans amounting to millions of dollars to affiliated companies.

The prosecution also intends to prove that that Phang instructed Hoo to appoint Phang's wife Neo Kuon Huay, 46, as group sales director so that she would be entitled to a sales commission. She then received nearly $950,000 between October 2005 and August 2007.

The trial continues.

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