The Ministry of National Development announced on Saturday that AHPETC's managing agent, FM Solutions and Services (FMSS) has been "profiteering" off the town council. MND claims that after a review of FMSS's auditor, Teo Liang Chye and Co, when AHPETC suffered an operating deficit of $2 million dollars, FMSS made an after-tax profit of $2 million after paying its directors $1.14 million.
AHPETC's independent auditor Audit Alliance LLP also found that AHPETC's deputy general manager who is also a shareholder and director of FMSS had approved invoices from FMSS totalling $2.1 million on behalf of the town council without a clear segregation of duties. The deputy general manager also approved related payment voucher by AHPETC to FMSS.
MND said that this new evidence "reinforced MND’s concerns about the TC’s state of financial management, and in particular, whether payments made by the TC to FMSS were valid and proper."
MND has written to WP Chairman Sylvia Lim "to ask if she was aware of the extent of profiteering in FMSS, and if so since when had she known, and what she had done about it". MND also queried Ms Lim if she has examined past transactions of the town council with FMSS and how she intends to recover the monies lost due to the profiteering.
AHPETC currently has no managing agent, after no one came forth to submit a bid.
FMSS made a profit after tax of S$510,904. This was after FMSS paid its three owners/directors, fees and salaries of S$702,295, and consultancy and secretarial fees of S$300,000. Total payments to the three FMSS Owners/Directors for FY2012/2013 amounted to S$1,513,199.
FMSS made a profit after tax of S$2,035,784. This was after FMSS paid its four owners/directors fees and salaries of S$839,696, and consultancy and secretarial fees of S$300,000. Total payments to the four FMSS owners/directors for FY2013/2014 amounted to S$3,175,480.