Integrity Focus

A company proprietor, charged by the ICAC, was today (October 8) sentenced to an imprisonment of 22 months at the District Court after admitting that he had deceived a bank into approving a loan of $3.1 million under the Special 100% Loan Guarantee (SLG) scheme by making false representations concerning the company’s contributions to the employees’ Mandatory Provident Fund (MPF).

Arri Wong Ka-nam, 55, proprietor of 24 Hr Locksmith, today pleaded guilty to one count of conspiracy to defraud, contrary to the Common Law. In sentencing, Deputy Judge Mr Cheng Lim-chi remarked that fraud was a serious offence. He took a starting point of an imprisonment of 36 months and reduced the jail term to 22 months having considered the defendant’s guilty plea and other mitigating factors.

The court heard that in April 2020, as one of the relief measures of the government, HKMC Insurance Limited (HKMCI) launched the SLG under the Small and Medium Enterprise (SME) Financing Guarantee Scheme to ease SMEs’ cash flow pressure during the pandemic.

Standard Chartered Bank (Hong Kong) Limited (Standard Chartered Bank) was one of the participating lenders under the scheme. After confirming an application received was legitimate, the bank would forward the application to HKMCI for final review and approval to grant a guarantee.

In September 2020, the defendant submitted an SLG loan application to Standard Chartered Bank, supported by false MPF statements which purportedly showed that 24 Hr Locksmith had made monthly contributions of $19,000 for its seven employees to an MPF trustee in Hong Kong.

Standard Chartered Bank subsequently found that the loan application was suspicious and hence did not forward it to HKMCI for final approval. As a result, 24 Hr Locksmith had not been approved of the facility concerned.

The ICAC investigation, which arose from a corruption complaint, revealed that 24 Hr Locksmith had never held any account with the MPF trustee nor made any MPF contributions for its employees.

HKMCI, Standard Chartered Bank and the MPF trustee concerned had rendered full assistance to the ICAC during its investigation into the case.

The prosecution was today represented by Acting Senior Public Prosecutor Jason Lau, assisted by ICAC officer Kiki Chu.