Recent ICAC Cases

01
Aug 2022
Buyer claiming property for self-use charged by ICAC over $7.8m mortgage loan fraud

The ICAC today (August 1) charged a property buyer for allegedly deceiving a bank and the HKMC Insurance Limited (HKMCI) into granting a mortgage loan with a loan-to-value (LTV) ratio of 80 per cent, amounting to about $7.8 million, by making false representations that a flat was purchased for self-use.

The ICAC investigation arose from a corruption allegation. Upon completion of the investigation, the ICAC sought legal advice from the Department of Justice, which advised charging the property buyer.

Hui Chi-fung, 38, Senior Station Officer of the Fire Services Department, faces two counts of fraud, contrary to Section 16A of the Theft Ordinance. He was released on ICAC bail, pending his appearance in the Eastern Magistrates’ Courts on Wednesday (August 3) for the case to be transferred to the District Court.

According to the guidelines issued by the Hong Kong Monetary Authority, banks are required to comply with the LTV ratio requirement for property mortgage lending. Banks participating in the mortgage insurance programme of the HKMCI (the Programme) can provide a mortgage loan with an LTV ratio of up to 80 per cent for a self-used private residential property valued between $6 million and $10 million. Industrial and Commercial Bank of China (Asia) Limited (ICBC Asia) is a participating bank.

In April 2020, the defendant purchased a residential property in San Po Kong at $9.65 million and applied for a mortgage loan with an LTV ratio of 80 per cent with the ICBC Asia under the Programme.

The charges allege that between April 16 and July 8, 2020, the defendant made false representations to the ICBC Asia and the HKMCI that the above residential property would be occupied by himself after completion of the purchase, and with intent to defraud, induced the ICBC Asia to approve a mortgage loan application and grant him a loan of about $7.8 million, and the HKMCI to approve the application for mortgage loan insurance cover in respect of the mortgage loan.

ICAC investigation revealed that the property was leased out shortly after the mortgage loan application was approved the ICBC Asia.

The ICBC Asia and the HKMCI had rendered full assistance to the ICAC during its investigation into the case.

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