Integrity Focus
Menu
Recent ICAC Cases Anti-Corruption Laws in Hong Kong Corruption Myths Cross-Boundary Business Operations Conflict of Interest
What is conflict of interest? Examples of conflict of interest Problems arising from conflict of interest How to handle conflict of interest? How well are we managing conflict of interest?
Ethical Decision MakingRecent ICAC Cases
11
Apr 2024Joint Press release: IA and ICAC conduct first joint operation against suspected unlicensed selling to Mainland visitorsThe Insurance Authority (IA) and the ICAC have conducted their first joint operation targeting corrupt conduct in the unlicensed sale of insurance policies to Mainland customers. The joint operation was conducted pursuant to the Memorandum of Understanding (MoU) signed by the ICAC and the IA on October 26, 2023.Search warrants were executed by the IA and the ICAC on two consecutive days (April 10 and 11) at four premises, including the offices of a licensed insurance broker company and a referral company. In the joint operation, the ICAC also arrested an individual broker and a referrer.The companies and individuals concerned are suspected of having engaged in, or conspired with others to carry on unlicensed regulated activities in contravention of the Insurance Ordinance (Note 1) and also of suspected offences of agent using documents with intent to deceive his principal under the Prevention of Bribery Ordinance. Breaches of the Code of Conduct for Licensed Insurance Brokers are also suspected to have been committed.The investigation concerns the suspected engagement and incentivisation of referrers by a broker company to carry on regulated activities (advising on and selling of insurance policies) on its behalf, even though such referrers do not have the requisite licence to do this. The broker company offered to pay inordinately high referral fees on successful sales, apparently incentivising its referrers to induce customers from the Mainland to buy long-term insurance policies from authorized insurers in Hong Kong. In some cases, referrers appear to have been paid over 90% of the commission received by the broker company. Although the broker company submitted the insurance application forms to insurers, the substantial regulated activities were apparently performed by referrers prior to customers having any engagement with the broker company.In the investigation, the individual broker and the referrer are also suspected of corruptly conspiring to include false information in application forms submitted to the Hong Kong insurers underwriting the policies, including the annual income and amount of assets held by Mainland customers.Mr Peter Gregoire, Head of Market Conduct and General Counsel of the IA, said: “Our partnership with the ICAC in carrying out this joint operation demonstrates our shared determination to uphold proper sales practices in the insurance industry, ensure the market is founded on trust and integrity, and thereby provide confidence to all persons who look to the Hong Kong insurance market to meet their insurance needs. This close collaboration will continue not only through joint enforcement measures but also through industry training via the Hong Kong International Academy Against Corruption to enhance corporate governance standards and public education to empower consumers.”Deputy Commissioner and Head of Operations of the ICAC, Mr Ricky Yau Shu-chun, said: “The MoU signed between the ICAC and the IA last year strengthened our cooperation in referral of cases, joint investigations, training and exchange of information. Last month, IA representatives attended a three-day Training on Joint Operations organised by the ICAC for local regulatory bodies to enhance officers’ capability of combating financial crime and corruption. This joint operation showcases our common goal in upholding the integrity of the insurance industry. The ICAC will continue to closely collaborate with the IA, as well as other financial regulators, to combat corruption, illicit activities and misconduct relating to the financial sector. We will strive to maintain a fair business environment in Hong Kong, to sustain Hong Kong’s status as a clean international financial centre and to ensure the trust of stakeholders in the financial system.”No further comment will be made by the IA or the ICAC at this stage as the investigation is ongoing. The IA urges all authorized insurers and licensed insurance intermediaries to comply with the Insurance Ordinance, and undertakes to continue to take swift and firm enforcement actions to curb the abovementioned activities and / or any other misconduct.Notes:1. Section 64G of the Insurance Ordinance stipulates that “A person must not carry on a regulated activity in the course of the person’s business or employment; or for reward.” It is also stipulated that “A person must not hold out that the person is carrying on a regulated activity in the course of the person’s business or employment; or is carrying on a regulated activity for reward.” A person who, without reasonable excuse, contravenes the above commits an offence and is liable on conviction on indictment to a maximum fine of $1,000,000 and imprisonment for 2 years. 09
Apr 2024Ex-employee of Chinese restaurant charged by ICAC admits theft over revised billsA former employee of a Chinese restaurant, charged by the ICAC, today (April 9) admitted at the Eastern Magistrates’ Courts that she had stolen over $23,000 from the restaurant by revising the relevant records in the computer system of the restaurant after customers had paid the bills.Leung Tsz-ying, 35, former clerk cum substitute cashier of Lei Garden Restaurant, pleaded guilty to five counts of theft, contrary to Section 9 of the Theft Ordinance.Principal Magistrate Miss Ivy Chui Yee-mei adjourned the case to April 23 for sentence, pending the defendant’s background report. The defendant was remanded in custody of the Correctional Services Department.When the case took place between December 2019 and December 2021, the defendant was a clerk cum substitute cashier of a branch of Lei Garden Restaurant in Central. She was authorised to revise or cancel customer orders in the computer system of the restaurant.The court heard that the defendant deleted the number of dishes ordered and served in the computer systems after three customers had paid their bills totalling over $20,000, misleading Lei Garden Restaurant that their bills added up to about $15,000 in total, to facilitate the defendant’s pocketing of the difference of about $5,000.In addition, the defendant stole $13,300 maintained in the meal expenses deposit account of a customer of Lei Garden Restaurant. In order to cover up her misappropriation, she deposited about $5,200 into the account after stealing the sum from another customer by the same fraudulent means of cancelling orders in the computer system.The ICAC investigation arose from a corruption complaint. Subsequent enquiries revealed the theft offences committed by the defendant. Lei Garden Restaurant had rendered full assistance to the ICAC during its investigation into the case.The prosecution was today represented by ICAC officer Jackie Lam. 05
Apr 2024HZMB shuttle bus casual worker charged by ICAC for soliciting bribe from tourists over boarding during pandemicA casual worker of the Hong Kong-Zhuhai-Macao Bridge (HZMB) shuttle bus was charged by the ICAC on Wednesday (April 3) for allegedly soliciting a bribe for assisting two tourists to board a shuttle bus departing for Zhuhai from Hong Kong before the Chinese New Year’s Eve last year.Ng Kwong-lung, 35, then casual worker of Hong Kong-Zhuhai-Macao Bridge Shuttle Bus Company Limited (HZMBus), faces one count of agent soliciting an advantage and one count of agent accepting an advantage, contrary to Section 9(1)(a) of the Prevention of Bribery Ordinance. He was released on ICAC bail, pending his appearance at the West Kowloon Magistrates’ Courts next Monday (April 8) for plea.HZMBus operates the HZMB shuttle bus service which runs between Hong Kong and Zhuhai. At the material time, HZMB shuttle bus was allowed to carry a specific number of passengers daily from Hong Kong to Zhuhai in view of the Mainland anti-pandemic measures. Only passengers with valid tickets booked through online real-name reservation were allowed to board the shuttle bus.The defendant was tasked to assist passengers to board the shuttle bus at the Hong Kong Port of the HZMB, including verifying whether passengers at the check-in gate got valid tickets for that day.On January 20, 2023 the defendant allegedly solicited a bribe of $1,000 from two Mainland tourists for assisting them to board a HZMB shuttle bus heading to Zhuhai, and accepted a bribe of RMB 500 from one of the duo.The ICAC investigation arose from a corruption complaint. Enquiries revealed that the two tourists arrived at the Hong Kong Port of the HZMB in late evening of January 20, 2023, the day before the Chinese New Year’s Eve. They sought assistance from the defendant as they did not manage to secure any ticket for the day or the following day. ICAC investigation also revealed that one of them subsequently declined the defendant’s solicitation.HZMBus has rendered full assistance to the ICAC during its investigation into the case. 27
Mar 2024Ex-security supervisor of public housing estate charged by ICAC gets two months’ jail for receiving ‘laisees’ over duty arrangementA former security supervisor of a public housing estate, charged by the ICAC, was today (March 27) sentenced to two months’ imprisonment at the Kowloon City Magistrates’ Courts after admitting her receiving of “laisees” totalling $4,000 from a subordinate security guard for arranging a post the latter preferred. The subordinate security guard had also been earlier sentenced to a jail term of two months after pleading guilty to the offences concerned.Chan Sau-wan, 70, former security supervisor of Nice Property Management Limited (Nice Property), pleaded guilty to two counts of agent accepting an advantage, contrary to section 9(1)(b) of the Prevention of Bribery Ordinance.In sentencing, Magistrate Mr Peter Yu Chun-cheung remarked that the offences were serious in nature. He took a starting point of three months’ imprisonment and reduced the jail term by one-third to two months, having considered the defendant’s guilty plea.At the material time, Nice Property was engaged by the Housing Department (HD) to provide security services in Lok Fu Estate. Nice Property forbade its staff to offer or accept any advantages in relation to their duties.The court heard that Chan was a morning shift security supervisor of Lok Fu Estate. She was responsible for preparing daily duty roster of subordinate security guards, including Liang Jinlan.Chan admitted that between mid-November 2022 and late January 2023, after her birthday and during Chinese New Year, she had accepted two “laisees” totalling $4,000 offered by Liang for arranging the latter to work at the reception of a building in Lok Fu Estate.The ICAC investigation arose from a corruption complaint referred by the HD. The HD and Nice Property had rendered full assistance to the ICAC during its investigation into the case. The prosecution was today represented by ICAC officer Michael Lim.The former security guard of Nice Property, Liang, 49, was sentenced to two months’ imprisonment late last year after pleading guilty to two counts of offering bribes. 26
Mar 2024Funeral agent charged by ICAC for bribery over servicesA funeral agent was yesterday (March 25) charged by the ICAC for allegedly offering a bribe of $3,000 to a fellow church member of a deceased elderly person for securing the business of the latter’s after-death arrangements.Chak Kwok-hung, 42, sales agent of Endless Love Care Service Company Limited (Endless Love), faces one count of offering an advantage to an agent, contrary to section 9(2)(a) of the Prevention of Bribery Ordinance.The defendant was released on ICAC bail, pending his appearance at the Kowloon City Magistrates’ Courts on Thursday (March 28) for plea.On March 6, 2023, an elderly person residing in a private residential care home passed away. The elderly person had given several ten thousand dollars to two fellow church members and entrusted them to take care of his funeral services beforehand. After the duo found out that the funeral services had been passed to Endless Love unbeknown to them on the same day the deceased died, one of them visited Endless Love to make enquiries.The charge alleges that on March 6, 2023, the defendant offered $3,000 to the fellow church member visiting Endless Love for referring the funeral services for the deceased elderly person to the defendant or Endless Love.The church member rejected the defendant’s offer and left.
Apr 2024Joint Press release: IA and ICAC conduct first joint operation against suspected unlicensed selling to Mainland visitorsThe Insurance Authority (IA) and the ICAC have conducted their first joint operation targeting corrupt conduct in the unlicensed sale of insurance policies to Mainland customers. The joint operation was conducted pursuant to the Memorandum of Understanding (MoU) signed by the ICAC and the IA on October 26, 2023.Search warrants were executed by the IA and the ICAC on two consecutive days (April 10 and 11) at four premises, including the offices of a licensed insurance broker company and a referral company. In the joint operation, the ICAC also arrested an individual broker and a referrer.The companies and individuals concerned are suspected of having engaged in, or conspired with others to carry on unlicensed regulated activities in contravention of the Insurance Ordinance (Note 1) and also of suspected offences of agent using documents with intent to deceive his principal under the Prevention of Bribery Ordinance. Breaches of the Code of Conduct for Licensed Insurance Brokers are also suspected to have been committed.The investigation concerns the suspected engagement and incentivisation of referrers by a broker company to carry on regulated activities (advising on and selling of insurance policies) on its behalf, even though such referrers do not have the requisite licence to do this. The broker company offered to pay inordinately high referral fees on successful sales, apparently incentivising its referrers to induce customers from the Mainland to buy long-term insurance policies from authorized insurers in Hong Kong. In some cases, referrers appear to have been paid over 90% of the commission received by the broker company. Although the broker company submitted the insurance application forms to insurers, the substantial regulated activities were apparently performed by referrers prior to customers having any engagement with the broker company.In the investigation, the individual broker and the referrer are also suspected of corruptly conspiring to include false information in application forms submitted to the Hong Kong insurers underwriting the policies, including the annual income and amount of assets held by Mainland customers.Mr Peter Gregoire, Head of Market Conduct and General Counsel of the IA, said: “Our partnership with the ICAC in carrying out this joint operation demonstrates our shared determination to uphold proper sales practices in the insurance industry, ensure the market is founded on trust and integrity, and thereby provide confidence to all persons who look to the Hong Kong insurance market to meet their insurance needs. This close collaboration will continue not only through joint enforcement measures but also through industry training via the Hong Kong International Academy Against Corruption to enhance corporate governance standards and public education to empower consumers.”Deputy Commissioner and Head of Operations of the ICAC, Mr Ricky Yau Shu-chun, said: “The MoU signed between the ICAC and the IA last year strengthened our cooperation in referral of cases, joint investigations, training and exchange of information. Last month, IA representatives attended a three-day Training on Joint Operations organised by the ICAC for local regulatory bodies to enhance officers’ capability of combating financial crime and corruption. This joint operation showcases our common goal in upholding the integrity of the insurance industry. The ICAC will continue to closely collaborate with the IA, as well as other financial regulators, to combat corruption, illicit activities and misconduct relating to the financial sector. We will strive to maintain a fair business environment in Hong Kong, to sustain Hong Kong’s status as a clean international financial centre and to ensure the trust of stakeholders in the financial system.”No further comment will be made by the IA or the ICAC at this stage as the investigation is ongoing. The IA urges all authorized insurers and licensed insurance intermediaries to comply with the Insurance Ordinance, and undertakes to continue to take swift and firm enforcement actions to curb the abovementioned activities and / or any other misconduct.Notes:1. Section 64G of the Insurance Ordinance stipulates that “A person must not carry on a regulated activity in the course of the person’s business or employment; or for reward.” It is also stipulated that “A person must not hold out that the person is carrying on a regulated activity in the course of the person’s business or employment; or is carrying on a regulated activity for reward.” A person who, without reasonable excuse, contravenes the above commits an offence and is liable on conviction on indictment to a maximum fine of $1,000,000 and imprisonment for 2 years. 09
Apr 2024Ex-employee of Chinese restaurant charged by ICAC admits theft over revised billsA former employee of a Chinese restaurant, charged by the ICAC, today (April 9) admitted at the Eastern Magistrates’ Courts that she had stolen over $23,000 from the restaurant by revising the relevant records in the computer system of the restaurant after customers had paid the bills.Leung Tsz-ying, 35, former clerk cum substitute cashier of Lei Garden Restaurant, pleaded guilty to five counts of theft, contrary to Section 9 of the Theft Ordinance.Principal Magistrate Miss Ivy Chui Yee-mei adjourned the case to April 23 for sentence, pending the defendant’s background report. The defendant was remanded in custody of the Correctional Services Department.When the case took place between December 2019 and December 2021, the defendant was a clerk cum substitute cashier of a branch of Lei Garden Restaurant in Central. She was authorised to revise or cancel customer orders in the computer system of the restaurant.The court heard that the defendant deleted the number of dishes ordered and served in the computer systems after three customers had paid their bills totalling over $20,000, misleading Lei Garden Restaurant that their bills added up to about $15,000 in total, to facilitate the defendant’s pocketing of the difference of about $5,000.In addition, the defendant stole $13,300 maintained in the meal expenses deposit account of a customer of Lei Garden Restaurant. In order to cover up her misappropriation, she deposited about $5,200 into the account after stealing the sum from another customer by the same fraudulent means of cancelling orders in the computer system.The ICAC investigation arose from a corruption complaint. Subsequent enquiries revealed the theft offences committed by the defendant. Lei Garden Restaurant had rendered full assistance to the ICAC during its investigation into the case.The prosecution was today represented by ICAC officer Jackie Lam. 05
Apr 2024HZMB shuttle bus casual worker charged by ICAC for soliciting bribe from tourists over boarding during pandemicA casual worker of the Hong Kong-Zhuhai-Macao Bridge (HZMB) shuttle bus was charged by the ICAC on Wednesday (April 3) for allegedly soliciting a bribe for assisting two tourists to board a shuttle bus departing for Zhuhai from Hong Kong before the Chinese New Year’s Eve last year.Ng Kwong-lung, 35, then casual worker of Hong Kong-Zhuhai-Macao Bridge Shuttle Bus Company Limited (HZMBus), faces one count of agent soliciting an advantage and one count of agent accepting an advantage, contrary to Section 9(1)(a) of the Prevention of Bribery Ordinance. He was released on ICAC bail, pending his appearance at the West Kowloon Magistrates’ Courts next Monday (April 8) for plea.HZMBus operates the HZMB shuttle bus service which runs between Hong Kong and Zhuhai. At the material time, HZMB shuttle bus was allowed to carry a specific number of passengers daily from Hong Kong to Zhuhai in view of the Mainland anti-pandemic measures. Only passengers with valid tickets booked through online real-name reservation were allowed to board the shuttle bus.The defendant was tasked to assist passengers to board the shuttle bus at the Hong Kong Port of the HZMB, including verifying whether passengers at the check-in gate got valid tickets for that day.On January 20, 2023 the defendant allegedly solicited a bribe of $1,000 from two Mainland tourists for assisting them to board a HZMB shuttle bus heading to Zhuhai, and accepted a bribe of RMB 500 from one of the duo.The ICAC investigation arose from a corruption complaint. Enquiries revealed that the two tourists arrived at the Hong Kong Port of the HZMB in late evening of January 20, 2023, the day before the Chinese New Year’s Eve. They sought assistance from the defendant as they did not manage to secure any ticket for the day or the following day. ICAC investigation also revealed that one of them subsequently declined the defendant’s solicitation.HZMBus has rendered full assistance to the ICAC during its investigation into the case. 27
Mar 2024Ex-security supervisor of public housing estate charged by ICAC gets two months’ jail for receiving ‘laisees’ over duty arrangementA former security supervisor of a public housing estate, charged by the ICAC, was today (March 27) sentenced to two months’ imprisonment at the Kowloon City Magistrates’ Courts after admitting her receiving of “laisees” totalling $4,000 from a subordinate security guard for arranging a post the latter preferred. The subordinate security guard had also been earlier sentenced to a jail term of two months after pleading guilty to the offences concerned.Chan Sau-wan, 70, former security supervisor of Nice Property Management Limited (Nice Property), pleaded guilty to two counts of agent accepting an advantage, contrary to section 9(1)(b) of the Prevention of Bribery Ordinance.In sentencing, Magistrate Mr Peter Yu Chun-cheung remarked that the offences were serious in nature. He took a starting point of three months’ imprisonment and reduced the jail term by one-third to two months, having considered the defendant’s guilty plea.At the material time, Nice Property was engaged by the Housing Department (HD) to provide security services in Lok Fu Estate. Nice Property forbade its staff to offer or accept any advantages in relation to their duties.The court heard that Chan was a morning shift security supervisor of Lok Fu Estate. She was responsible for preparing daily duty roster of subordinate security guards, including Liang Jinlan.Chan admitted that between mid-November 2022 and late January 2023, after her birthday and during Chinese New Year, she had accepted two “laisees” totalling $4,000 offered by Liang for arranging the latter to work at the reception of a building in Lok Fu Estate.The ICAC investigation arose from a corruption complaint referred by the HD. The HD and Nice Property had rendered full assistance to the ICAC during its investigation into the case. The prosecution was today represented by ICAC officer Michael Lim.The former security guard of Nice Property, Liang, 49, was sentenced to two months’ imprisonment late last year after pleading guilty to two counts of offering bribes. 26
Mar 2024Funeral agent charged by ICAC for bribery over servicesA funeral agent was yesterday (March 25) charged by the ICAC for allegedly offering a bribe of $3,000 to a fellow church member of a deceased elderly person for securing the business of the latter’s after-death arrangements.Chak Kwok-hung, 42, sales agent of Endless Love Care Service Company Limited (Endless Love), faces one count of offering an advantage to an agent, contrary to section 9(2)(a) of the Prevention of Bribery Ordinance.The defendant was released on ICAC bail, pending his appearance at the Kowloon City Magistrates’ Courts on Thursday (March 28) for plea.On March 6, 2023, an elderly person residing in a private residential care home passed away. The elderly person had given several ten thousand dollars to two fellow church members and entrusted them to take care of his funeral services beforehand. After the duo found out that the funeral services had been passed to Endless Love unbeknown to them on the same day the deceased died, one of them visited Endless Love to make enquiries.The charge alleges that on March 6, 2023, the defendant offered $3,000 to the fellow church member visiting Endless Love for referring the funeral services for the deceased elderly person to the defendant or Endless Love.The church member rejected the defendant’s offer and left.