National Kidney Foundation Singapore scandal
The National Kidney Foundation Singapore scandal, also known as the NKF saga, NKF scandal, or NKF controversy, was a July 2005 scandal involving National Kidney Foundation Singapore (NKF) following the collapse of a defamation trial which it brought against Susan Long and Singapore Press Holdings (SPH). This sparked significant controversy, causing a massive backlash and fallout of donors to the charity; it then subsequently resulted in the resignation of chief executive officer T.T Durai and its board of directors. Allegations surrounding the scandal included the false declarations on how long NKF's reserves could last , its number of patients, installation of a golden tap in Durai's private office suite, his salary, use of company cars and first-class air travel. Former NKF patron Tan Choo Leng, wife of Senior Minister Goh Chok Tong, sparked further outrage when she remarked that T.T Durai's pay of "S$600,000 a year is peanuts". President of the National Council of Social Service, Gerard Ee, has since been appointed as interim chairman of the organisation. A full independent audit on its finances was conducted by KPMG, and a 442-page report released on 19 December 2005 revealed a host  of malpractices by the former NKF board and management. Durai was apprehended on 17 April 2006 and charged under the Prevention of Corruption Act by the Police. A S$12 million civil suit to recover funds by the new NKF board against Durai and four other former board members began on 8 January 2007. Initial accusations. In August 1997 and December 1998, NKF volunteer Archie Ong and aero-modelling instructor Piragasam Singaravelu respectively were hauled to court separately for defamation when both said that T.T. Durai had been flying first class. The former mentioned in April 1997 that the NKF "squandered  monies" in a casual conversation with former chairman of NKF's finance committee Alwyn Lim, while the latter made claims that he had personally seen Mr Durai in Singapore Airlines' first-class cabin. Both paid an undisclosed amount of damages to the NKF, and apologised. News of the suit affected Ong's cancer-suffering father, who eventually passed away in hospital. Shortly after the 2005 scandal broke, Ong mentioned to the press that he felt "fully vindicated now. I had more than a hundred calls today to wish me well." In 1999, NKF tracked down and again sought legal action  against Tan Kiat Noi, who allegedly circulated an e-mail from her company e-mail on 5 April, claiming that "the NKF did not help the poor and needy, paid its staff unrealistically high bonuses" and discouraged members of the public from donating. She later also published a public apology on local broadsheets The Straits Times and Lianhe Zaobao, while paying a total of S$50,000 in damages. 48 additional workers who forwarded the same e-mail were also sued by the organisation, but the suit was later dropped in consideration that they would face possibly extenuating financial circumstances. Days since  the 2007 civil suit began, there have been calls by the public to redress the grievances of the three abovementioned whistle-blowers. In 2001, the National Council of Social Service refused to renew the NKF's "Institution of Public Character" (IPC) status (which allows it to collect tax-free donations), citing that subsidy figures had been inflated, staff costs had increased by 30% and a "disproportionate" amount of money was spent on fundraising. Concerns were first raised by both by the Health Ministry and NCSS two years ago. However, the former decided to intervene in January 2002 and reinstated the  NKF's IPC status for a full three years. NKF v. SPH. Allegations in article. "The Straits Times" published an editorial ""NKF: Controversially ahead of its time?"" on 19 April 2004, written by senior correspondent Susan Long. This article became the subject of the dispute, and eventually the lawsuit that led to the scandal. Durai and NKF challenged the first six lines of the article, which claimed that a retired contractor (who declined to - and cannot - be named, for fear of being sued) had 'lost it' when he was asked to install "a glass-panelled shower, a pricey German  toilet bowl and a (S$1,000) gold-plated tap" in Durai's office. The tap was said to have been replaced later with a different material. NKF shortly issued a letter of demand for an apology, retraction, and payment of damages from the paper's publisher, Singapore Press Holdings (SPH), within 24 hours. Four days after the article's publication, NKF and Durai served a writ on Long and SPH for defamation, demanding S$3.24 million in damages. They claimed that the six paragraphs in the article insinuated the mismanagement of donors' funds, that the installations were scaled down only due to  the contractor's protests, and that it had avoided providing further details on that matter. The proceedings. The trial began on 11 July 2005, with Long and SPH represented by Senior Counsel and MP Davinder Singh, while NKF and Durai were represented by Senior Counsel Michael Khoo. Under cross-examination, it was revealed that Durai collected a monthly salary of $25,000 and collected a 10-month bonus in 2002 and a 12-month bonus in both 2003 and 2004, for a total of $1.8 million over three years. He had access to a fleet of eight chauffeured cars  and the NKF paid the taxes and maintenance costs of his personal Mercedes-Benz. Case dropped. The case was dropped by Durai on 5 PM on the second day of the trial. Aftermath. The Ministry of Health demanded that NKF pay for damages. Public backlash and controversy. The focus of the scandal turned to the revelation of Durai's S$600,000 pay, which caused widespread feelings of outrage, anger, and betrayal among the general public. Some 3,800 regular donors cancelled their contributions the day after the trial, and NKF's headquarters was vandalised with graffiti. Mrs Goh's remarks. Following questions  about Durai's pay, wife of Senior Minister Goh Chok Tong and patron of the NKF Tan Choo Leng defended Durai, commenting that "for a person who runs a big million-dollar charitable organisation, with a few hundred million in reserves, S$600,000 a year is peanuts", much to the indignation of Singaporeans. The statement was taken as an insult by many, who earn much less a year or even struggle for a living. Blogs and online message boards were quickly flooded with angry comments, and a second online petition requesting Mrs Goh to apologise was started. Jokes on the issue  were later circulated, in particular, local satirical website TalkingCock.com published a post featuring a parody 1 peanut bill with a value equivalent to S$600,000. On 16 July 2005, SM Goh said that Mrs Goh regretted the statement. He also said to have explained and shown her several e-mails and letters he had received after the remark was made. In what SM Goh claims to be a separate matter, Mrs Goh has also resigned as patron of the NKF, despite an earlier announcement to remain on the board. Interim board. On 14 July 2005, TT Durai and the NKF board  resigned en masse. Health Minister Khaw Boon Wan appointed Gerard Ee as interim chairman and CEO. Independent investigation. In July 2005, KPMG was commissioned by the new NKF board to study past practices. KPMG published its report in December 2005, with key findings including: Apprehensions and subsequent lawsuits. Durai was arrested on 17 April 2006. He was out on bail, but will stand for trial with other members of the old National Kidney Foundation board of directors. He has also agreed to pay back S$4 million to the new NKF and was sentenced to 3 months jail for misleading NKF  by fabricating a $20,000 invoice. Richard Yong (the former chairman), Mathilda Chua (ex-director) and Loo Say San (ex-treasurer) were all declared bankrupt on 16 May 2007. After selling personal properties worth $7.5 million, the former left Singapore without permission early on the morning of 17 May but was apprehended on 4 July 2007 in Hong Kong and extradited back to Singapore on 3 August 2007 where he was charged the next day for charges that the NKF levied on him as well as his flight (or fleeing) from Singapore hours before being declared a bankrupt. Yong  said that he had left to settle some personal matters. He was sentenced to 15 months in jail for the three charges. Five separate charges were taken into consideration during the sentencing. His sentence will commence from the day that he was extradited back to Singapore. Yong has said that he plans to appeal, but lost the appeal and had to serve out his sentence. However, he was given permission to serve half of his jail term (five months) at home on an electronic tag. Long-term consequences. The scandal has raised questions about the level of transparency in other  institutions in Singapore. Opposition politicians, notably Chee Soon Juan, have noted that the issues at NKF would probably not have been revealed had T.T. Durai not sued the "Straits Times". Four people linked to the Singapore Democratic Party held a silent demonstration outside the Central Provident Fund (CPF) headquarters in July 2005, wearing T-shirts emblazoned with "GIC HDB NKF CPF Transparency now!", thus demanding greater transparency from the Government Investment Corporation (GIC), the Housing Development Board (HDB) and the CPF. The protesters were arrested but later dismissed without charges, with their own countersuit for unlawful detention dismissed with costs . On 21 April 2006, Chee Soon Juan and 12 other defendants were sued for defamation for questioning the government's handling of the NKF scandal in the Singapore Democratic Party's newsletter "The New Democrat". New NKF v. Old NKF. The civil trial by the new board against the old executive committee – former CEO TT Durai, chairman Richard Yong, treasurer Loo Say San, board member Maltilda Chua and business associate opened on 8 January 2007. Damages of S$12 million are sought for alleged mismanagement, breach of duty and damage and loss to the organisation. Durai was accused of running the  charity to his advantage, destruction of documents, and the like, with the new committee asserting that as a charity, NKF as a charity, and Durai as CEO, should be subjected to a higher and more rigorous standard of care. On the third day, Durai accepted all liabilities and all claims against him. The only public statement by Rajah – Durai's lawyer – was to confirm that his client had dropped out of the matter. Later that day around 17:00 (SST), NKF's lawyer, Shanmugam, confirmed to reporters that Durai conceded; the amount of damages to be paid to the NKF are  still to be settled. However, the decision by the other defendants to continue will have implications to other equally liable directors and third parties (Alwyn Lim, Lawrence Chia, Kweh Soon Han and Chow Kok Fong). The result of Durai conceding will make the trial shorter rather than an expected eight-week trial.