Integrity Focus

A former manager of a telecommunications company, charged by the ICAC, today (June 19) admitted at the Court of First Instance of the High Court that he had deceived the company into issuing purchase orders worth totalling over HK$30 million and making service payments totalling over HK$16 million to a supplier owned by his mother by concealing his conflict of interest.

Cheung Cheuk-man, 46, former manager of PCCW Services Limited (PCCW Services), a subsidiary of PCCW Limited (PCCW), today pleaded guilty to one count of fraud, contrary to section 16A(1) of the Theft Ordinance. Ms Justice Esther Toh Lye-ping adjourned the case to tomorrow (June 20) for mitigation and sentence.

The court heard that in November 2014, the defendant was employed by PCCW Services to work as a manager of the network service team of PCCW Solutions Limited (PCCW Solutions), another subsidiary of PCCW, which provided a wide range of information technology and network solutions to its clients. PCCW’s policy stipulated that its employees and subsidiaries must make declarations where potential conflicts of interest arose.

Upon the defendant’s recommendation, Go Go Wifi Limited (GGWL) was included in the list of approved suppliers of PCCW and its subsidiaries since January 2016. Between January 2016 and July 2017, the defendant procured PCCW Solutions to issue 29 purchase orders in the sum of over HK$30 million to GGWL, which subsequently received payments of about HK$8.7 million and about US$990,000 from PCCW Solutions.

The ICAC investigation arose from a corruption complaint. Enquiries revealed that the defendant’s mother had become the sole director cum shareholder of GGWL since August 2014, but he had never disclosed to his employer his mother’s interests in GGWL.

The defendant was responsible for obtaining quotations and confirming receipt of services before release of payments to GGWL for the 29 purchase orders. ICAC enquiries revealed that the defendant had used false quotations purportedly issued by other companies to procure awarding the contracts to GGWL by making it the lowest bidder. On various occasions, the defendant had confirmed to PCCW Solutions in writing that he had no conflict of interest in the purchases concerned.

It was also revealed in the ICAC investigation that GGWL had never provided any service in relation to the 29 purchase orders. The services concerned were either provided by other service suppliers or carried out internally by PCCW Solutions.

The prosecution earlier withdrew a charge of “money-laundering” against the defendant’s mother, Lee Po-mei, 67.

PCCW and its subsidiaries had rendered full assistance to the ICAC during its investigation into the case.

The prosecution was today represented by Senior Public Prosecutor Audrey Parwani, assisted by ICAC officer Wilson Lam.

The ICAC encourages public and private organisations to establish clear guidelines and systems of declaration on conflict of interest. Staff should avoid conflict of interest and make declarations in strict adherence to internal guidelines. Concealing any conflict of interest in relation to one’s official duties to benefit himself or his associates may contravene the criminal law, such as the Prevention of Bribery Ordinance if offering or accepting of bribes is involved.