National Kidney Foundation Singapore scandal

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.[6][10] 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.[10] 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 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.[11]

The case was dropped by Durai on 5 PM on the second day of the trial.

T.T Durai and Health Minister Khaw Boon Wan at a press conference. Durai and NKF's board of directors resigned amidst the scandal.

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.[12]

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.",[13][14] 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.[15]

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,[16] despite an earlier announcement to remain on the board.[13]

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.

In July 2005, KPMG was commissioned by the new NKF board to study past practices. KPMG published its report[17] in December 2005, with key findings including:

• The Board delegated its authority to the Executive Committee, and the Executive Committee in turn delegated its authority to Durai.
• In 2003, only ten cents out of every dollar raised were used for dialysis costs. In its 2004 annual report, NKF had claimed that 52 cents out of every dollar went to its beneficiaries.
• NKF awarded contracts worth $3 million to Forte Systems and $4 million to Protonweb, second one run by Pharis Aboobacker, a close friend of Durai. Neither project was successfully completed, but no action was taken against the companies. In KPMG's judgment, the terms of the contracts were "unusual" and the ExCo's disregard of the lack of performance was "extraordinary".

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.[18] 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.[19]

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.

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.