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Ethical Decision MakingRecent ICAC Cases
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Jun 2024Businessman charged by ICAC for laundering RMB 400mA businessman was charged by the ICAC yesterday (June 17) for allegedly laundering crime proceeds totalling over RMB 400 million through a bank account in Hong Kong.Tan Kim Chwee, 60, faces one count of dealing with property known or believed to represent proceeds of indictable offence, contrary to section 25(1) of the Organized and Serious Crimes Ordinance. He was released on ICAC bail, pending his appearance at the Eastern Magistrates’ Courts tomorrow (June 19) for mention.The charge alleges that between February and September 2020, the defendant dealt with two sums totalling over RMB 400 million in his bank account held with a bank in Hong Kong, knowing or having reasonable grounds to believe that the sums in whole or in part directly or indirectly represented any person’s proceeds of an indictable offence.The ICAC investigation arose from a corruption complaint. Enquiries revealed the defendant’s alleged involvement in illegal activities by assisting another man to hold the shares of a company between 2013 and 2020, and using the defendant’s bank account in Hong Kong to receive sums totalling over RMB 400 million between February and September 2020 after the shares were sold.The relevant investigation is continuing, the ICAC does not rule out laying more charges against the defendant.The bank concerned has rendered full assistance to the ICAC during its investigation into the case. 14
Jun 2024ICAC operation ‘Gale’: 20 arrested in connection with alleged bribery for falsifying car testing centre’s annual examination resultsIn an operation codenamed “Gale” mounted early last week, the ICAC arrested 20 people, including staff members of a designated car testing centre (DCTC) in the New Territories, for their suspected involvement in a bribery scam that facilitated a number of private cars to pass the annual vehicle examination by circumventing the examination procedures of the Transport Department (TD).Eighteen of the arrestees, all male, aged between 27 and 69, are respectively 10 staff members of a DCTC, four proprietors of three garages, and four middlemen. The 10 DCTC staff members are four responsible persons (RPs) and six approved car testers (ACTs); one of the RPs is also the manager of the DCTC.In the operation, search warrants were executed by ICAC officers to conduct searches at various premises, including the DCTC, as well as offices and places of business of the garages. A total of 10 private cars were seized and over 10 individuals, including the car owners concerned, were also interviewed by ICAC officers.According to the Road Traffic Ordinance, all private cars manufactured for six years or more are required to undergo an annual examination at a DCTC appointed by the TD. ACTs are responsible for conducting the annual vehicle examination under the supervision of RPs, and issuing a certificate of roadworthiness for each vehicle which has passed the examination for the car owner to renew its licence.The ICAC investigation arose from corruption complaints in relation to annual vehicle examination. The complaints concern allegations in relation to staff members of the DCTC accepting bribes from the proprietors of the three garages or the middlemen to fraudulently facilitate private cars not meeting the relevant standards to pass the annual vehicle examination, contravening section 9 of the Prevention of Bribery Ordinance and other relevant legislation.The ICAC investigation identified that the private cars concerned were referred by the three garages to the DCTC for conducting the annual vehicle examination. In particular, it was revealed that the scam involved falsified results of the smoke emission test. Other test results relating to safety issues were believed to be unaffected.The arrested DCTC staff members are suspected of accepting bribes for substituting the results of private cars passing the smoke emission test as purported results for cars which failed the test.The 10 private cars seized in the operation were sent to the TD for re-examination. All 10 private cars failed the annual vehicle examination and it was revealed that the exhaust system of some of the cars had been altered.Investigation so far revealed that the car owners concerned engaged the three garages for the annual vehicle examination. The ICAC is looking into their knowledge of the scam.Also arrested in the operation were two contract staff of the TD. Although the duo did not discharge any car-testing duties, they were suspected of accepting advantages from one of the responsible persons of the DCTC for tipping him off about possible ICAC investigation of the DCTC.All arrestees have been released on ICAC bail. As the ICAC corruption inquiries are ongoing, further law enforcement actions will not be ruled out. No further comment on the case will be made by the Commission at this stage.The TD has rendered full assistance to the ICAC during its investigation. The ICAC has offered corruption prevention advice on vehicle inspection arrangements at DCTCs. Following the findings of this case, the ICAC and the TD will review the relevant procedures and strengthen supervision of DCTCs so as to stamp out malpractices. 13
Jun 2024Asset management firm owner charged by ICAC for laundering $50 millionAn owner of an asset management company was charged by the ICAC yesterday (June 12) for allegedly laundering crime proceeds of about $50 million through a number of companies and individuals.Xiao Rui, 35, an owner of Augustine Holdings Limited (AHL), faces two counts of dealing with property known or believed to represent proceeds of indictable offence, contrary to Section 25(1) of the Organized and Serious Crimes Ordinance. He was released on ICAC bail, pending his appearance at the Eastern Magistrates’ Courts tomorrow (June 14) for mention.The offences took place between March 2016 and November 2023. At the material time, the defendant and two other persons jointly set up AHL. The company was engaged in asset management business and had three subsidiaries. In 2016, the defendant requested one of the AHL owners who was familiar with the operation of underground money changers to assist him in remitting money from the Mainland to Hong Kong.The charges allege that the defendant dealt with 34 sums totalling about $50 million deposited to his two personal bank accounts by 12 companies and 11 persons, knowing or having reasonable grounds to believe that the sums in whole or in part directly or indirectly represented any person’s proceeds of indictable offence.The ICAC investigation arose from a corruption complaint. Enquiries revealed that the 12 companies and 11 persons concerned had no business dealings with AHL and its subsidiaries, and were not their customers.The relevant investigation is continuing, the ICAC does not rule out further prosecution. 12
Jun 2024Company director charged by ICAC for using fake identity to open bank accountsA company director was charged by the ICAC yesterday (June 11) for allegedly obtaining services by deception by using a fake identity to open a number of bank accounts at two banks.The ICAC investigation stemmed from a corruption complaint alleging manipulation of share prices of listed companies, leading to an operation jointly mounted by the ICAC and the Securities and Futures Commission in August last year. Subsequent ICAC investigation revealed the offences in the present case. The company director was charged by the ICAC yesterday after seeking legal advice from the Department of Justice. The original corruption investigation is continuing that the ICAC does not rule out further prosecution.Fang Siyuan, 37, faces two counts of obtaining services by deception, contrary to section 18A(1) of the Theft Ordinance. He was released on ICAC bail, pending his appearance in the Eastern Magistrates’ Courts tomorrow (June 13) for mention. The prosecution will later apply to transfer the case to the District Court for plea.In November 2020 and September 2021, the defendant respectively met with staff members of two banks for opening personal bank accounts.The charges allege that the defendant dishonestly obtained services from the two banks by deception, namely opening eight personal bank accounts, including a securities account, by falsely representing that he was Fong Tim who was holding a Mexican passport.In the account opening process, the defendant presented the passport to bank staff and signed to confirm that the information he provided was true and correct. The ICAC investigation revealed that the name and date of birth shown on the passport differed from the information shown on other identity documents of the defendant.Had the two banks known that the defendant had identities bearing different names and dates of birth, they would not have approved his account opening applications.The two banks concerned have rendered full assistance to the ICAC during its investigation into the case. 11
Jun 2024Six people charged by ICAC for bribery involving landfill contractor staff for free disposal of construction wasteThe ICAC today (June 11) charged four employees of a contractor of the Environmental Protection Department (EPD) and two staff of a waste disposal company for allegedly offering and accepting advantages of laisees, coupons and drinks for assisting the company to unload construction waste to a landfill free of charge by disguising the waste loaded on trucks as non-construction waste and conspiracy to defraud the EPD.The six defendants, aged between 31 and 66, are four employees of a contractor of the EPD, namely tipping face waste inspector of Far East Landfill Technologies Limited (Far East) Mak Wah-sing and three weighbridge operators of Far East – Chung Pui-chun, Cheung Kam-ning and Chung Ching-kwan. The two employees of the disposal company concerned are Mak Kim-kwan and Lin Wenjian, respectively truck driver and worker of T.S. Industrial Materials Recycle Limited (TSL).The six people jointly face one count of conspiracy to defraud, contrary to Common Law. Mak Kim-kwan alone faces four counts of offering an advantage to an agent, contrary to Section 9(2)(a) of the Prevention of Bribery Ordinance (POBO). Meanwhile, Mak Wah-sing, Chung Pui-chun and Cheung Kam-ning each faces one count of agent accepting an advantage, contrary to Section 9(1)(a) of the POBO.All defendants were released on ICAC bail, pending their appearance in the Eastern Magistrates’ Courts on Thursday (June 13) for mention. The prosecution will apply to transfer the case to the District Court for plea.At the material time, Far East was engaged by the EPD to operate a landfill in Fanling for disposal of construction waste and non-construction waste, including municipal waste. Trucks disposing construction waste were required to use the construction waste entrance and produce chits issued by the EPD to weighbridge operators for settling the disposal charge, which was $200 per tonne. Meanwhile, disposal of non-construction waste was free of charge.Weighbridge operators of Far East would conduct routine inspection on trucks using the non-construction waste entrance and weigh those trucks to verify whether construction waste was loaded on them. EPD staff would also conduct ambush inspections on trucks entering the landfill.TSL was a waste disposal company which operated a waste recycling site in Fanling. It conveyed construction waste to the landfill for its client.It is alleged that between January 2021 and June 2022, the six defendants conspired together to defraud the EPD by dishonestly disguising construction waste to be unloaded by trucks of TSL as non-construction waste for disposal; alerting in advance Mak Kim-kwan when inspection was to be carried out by the EPD and enabling trucks of TSL to evade payments for disposal of construction waste at the landfill.In the abovementioned one and a half years, Mak Kim-kwan allegedly offered laisees, coupons and bottled drinks to four employees of Far East, including Mak Wah-sing, Chung Pui-chun and Cheung Kam-ning, so as to alert him in advance when the EPD was to carry out inspections and facilitated construction waste conveyed to the landfill by trucks of TSL to be disposed of without payment of the required fees. Meanwhile, Mak Wah-sing, Chung Pui-chun and Cheung Kam-ning allegedly accepted those advantages from Mak Kim-kwan.The ICAC investigation arose from a corruption complaint. Enquiries revealed that at the material time, TSL offered laisees, mooncake coupons and rice dumpling coupons worth totalling about $50,000 to Far East staff, and provided a large quantity of non-alcoholic bottled drinks to Far East staff on a daily basis.ICAC enquiries also revealed that non-construction waste was used to cover construction waste loaded on TSL trucks. By pretending that its trucks were uploading non-construction waste, TSL evaded making the relevant waste disposal payments.In around a month between mid-May and mid-June 2022, TSL declared to the EPD that it had conveyed non-construction waste on about 760 occasions. ICAC enquiries revealed that about 90 per cent of the trucks were disguised as carrying non-construction waste. A total of over 4,100 tonnes of construction waste, incurring disposal charge of over $830,000, were in fact loaded on the trucks.The EPD and Far East have rendered full assistance to the ICAC during its investigation into the case.The ICAC reminds staff of business organisations not to be tempted by trivial advantages and breach the law inadvertently. According to the Prevention of Bribery Ordinance, an advantage includes, irrespective of the value, any money, gift, loan, contract and services, etc. Offeror and recipient of the bribe may breach the law as long as a corrupt motive is involved.
Jun 2024Businessman charged by ICAC for laundering RMB 400mA businessman was charged by the ICAC yesterday (June 17) for allegedly laundering crime proceeds totalling over RMB 400 million through a bank account in Hong Kong.Tan Kim Chwee, 60, faces one count of dealing with property known or believed to represent proceeds of indictable offence, contrary to section 25(1) of the Organized and Serious Crimes Ordinance. He was released on ICAC bail, pending his appearance at the Eastern Magistrates’ Courts tomorrow (June 19) for mention.The charge alleges that between February and September 2020, the defendant dealt with two sums totalling over RMB 400 million in his bank account held with a bank in Hong Kong, knowing or having reasonable grounds to believe that the sums in whole or in part directly or indirectly represented any person’s proceeds of an indictable offence.The ICAC investigation arose from a corruption complaint. Enquiries revealed the defendant’s alleged involvement in illegal activities by assisting another man to hold the shares of a company between 2013 and 2020, and using the defendant’s bank account in Hong Kong to receive sums totalling over RMB 400 million between February and September 2020 after the shares were sold.The relevant investigation is continuing, the ICAC does not rule out laying more charges against the defendant.The bank concerned has rendered full assistance to the ICAC during its investigation into the case. 14
Jun 2024ICAC operation ‘Gale’: 20 arrested in connection with alleged bribery for falsifying car testing centre’s annual examination resultsIn an operation codenamed “Gale” mounted early last week, the ICAC arrested 20 people, including staff members of a designated car testing centre (DCTC) in the New Territories, for their suspected involvement in a bribery scam that facilitated a number of private cars to pass the annual vehicle examination by circumventing the examination procedures of the Transport Department (TD).Eighteen of the arrestees, all male, aged between 27 and 69, are respectively 10 staff members of a DCTC, four proprietors of three garages, and four middlemen. The 10 DCTC staff members are four responsible persons (RPs) and six approved car testers (ACTs); one of the RPs is also the manager of the DCTC.In the operation, search warrants were executed by ICAC officers to conduct searches at various premises, including the DCTC, as well as offices and places of business of the garages. A total of 10 private cars were seized and over 10 individuals, including the car owners concerned, were also interviewed by ICAC officers.According to the Road Traffic Ordinance, all private cars manufactured for six years or more are required to undergo an annual examination at a DCTC appointed by the TD. ACTs are responsible for conducting the annual vehicle examination under the supervision of RPs, and issuing a certificate of roadworthiness for each vehicle which has passed the examination for the car owner to renew its licence.The ICAC investigation arose from corruption complaints in relation to annual vehicle examination. The complaints concern allegations in relation to staff members of the DCTC accepting bribes from the proprietors of the three garages or the middlemen to fraudulently facilitate private cars not meeting the relevant standards to pass the annual vehicle examination, contravening section 9 of the Prevention of Bribery Ordinance and other relevant legislation.The ICAC investigation identified that the private cars concerned were referred by the three garages to the DCTC for conducting the annual vehicle examination. In particular, it was revealed that the scam involved falsified results of the smoke emission test. Other test results relating to safety issues were believed to be unaffected.The arrested DCTC staff members are suspected of accepting bribes for substituting the results of private cars passing the smoke emission test as purported results for cars which failed the test.The 10 private cars seized in the operation were sent to the TD for re-examination. All 10 private cars failed the annual vehicle examination and it was revealed that the exhaust system of some of the cars had been altered.Investigation so far revealed that the car owners concerned engaged the three garages for the annual vehicle examination. The ICAC is looking into their knowledge of the scam.Also arrested in the operation were two contract staff of the TD. Although the duo did not discharge any car-testing duties, they were suspected of accepting advantages from one of the responsible persons of the DCTC for tipping him off about possible ICAC investigation of the DCTC.All arrestees have been released on ICAC bail. As the ICAC corruption inquiries are ongoing, further law enforcement actions will not be ruled out. No further comment on the case will be made by the Commission at this stage.The TD has rendered full assistance to the ICAC during its investigation. The ICAC has offered corruption prevention advice on vehicle inspection arrangements at DCTCs. Following the findings of this case, the ICAC and the TD will review the relevant procedures and strengthen supervision of DCTCs so as to stamp out malpractices. 13
Jun 2024Asset management firm owner charged by ICAC for laundering $50 millionAn owner of an asset management company was charged by the ICAC yesterday (June 12) for allegedly laundering crime proceeds of about $50 million through a number of companies and individuals.Xiao Rui, 35, an owner of Augustine Holdings Limited (AHL), faces two counts of dealing with property known or believed to represent proceeds of indictable offence, contrary to Section 25(1) of the Organized and Serious Crimes Ordinance. He was released on ICAC bail, pending his appearance at the Eastern Magistrates’ Courts tomorrow (June 14) for mention.The offences took place between March 2016 and November 2023. At the material time, the defendant and two other persons jointly set up AHL. The company was engaged in asset management business and had three subsidiaries. In 2016, the defendant requested one of the AHL owners who was familiar with the operation of underground money changers to assist him in remitting money from the Mainland to Hong Kong.The charges allege that the defendant dealt with 34 sums totalling about $50 million deposited to his two personal bank accounts by 12 companies and 11 persons, knowing or having reasonable grounds to believe that the sums in whole or in part directly or indirectly represented any person’s proceeds of indictable offence.The ICAC investigation arose from a corruption complaint. Enquiries revealed that the 12 companies and 11 persons concerned had no business dealings with AHL and its subsidiaries, and were not their customers.The relevant investigation is continuing, the ICAC does not rule out further prosecution. 12
Jun 2024Company director charged by ICAC for using fake identity to open bank accountsA company director was charged by the ICAC yesterday (June 11) for allegedly obtaining services by deception by using a fake identity to open a number of bank accounts at two banks.The ICAC investigation stemmed from a corruption complaint alleging manipulation of share prices of listed companies, leading to an operation jointly mounted by the ICAC and the Securities and Futures Commission in August last year. Subsequent ICAC investigation revealed the offences in the present case. The company director was charged by the ICAC yesterday after seeking legal advice from the Department of Justice. The original corruption investigation is continuing that the ICAC does not rule out further prosecution.Fang Siyuan, 37, faces two counts of obtaining services by deception, contrary to section 18A(1) of the Theft Ordinance. He was released on ICAC bail, pending his appearance in the Eastern Magistrates’ Courts tomorrow (June 13) for mention. The prosecution will later apply to transfer the case to the District Court for plea.In November 2020 and September 2021, the defendant respectively met with staff members of two banks for opening personal bank accounts.The charges allege that the defendant dishonestly obtained services from the two banks by deception, namely opening eight personal bank accounts, including a securities account, by falsely representing that he was Fong Tim who was holding a Mexican passport.In the account opening process, the defendant presented the passport to bank staff and signed to confirm that the information he provided was true and correct. The ICAC investigation revealed that the name and date of birth shown on the passport differed from the information shown on other identity documents of the defendant.Had the two banks known that the defendant had identities bearing different names and dates of birth, they would not have approved his account opening applications.The two banks concerned have rendered full assistance to the ICAC during its investigation into the case. 11
Jun 2024Six people charged by ICAC for bribery involving landfill contractor staff for free disposal of construction wasteThe ICAC today (June 11) charged four employees of a contractor of the Environmental Protection Department (EPD) and two staff of a waste disposal company for allegedly offering and accepting advantages of laisees, coupons and drinks for assisting the company to unload construction waste to a landfill free of charge by disguising the waste loaded on trucks as non-construction waste and conspiracy to defraud the EPD.The six defendants, aged between 31 and 66, are four employees of a contractor of the EPD, namely tipping face waste inspector of Far East Landfill Technologies Limited (Far East) Mak Wah-sing and three weighbridge operators of Far East – Chung Pui-chun, Cheung Kam-ning and Chung Ching-kwan. The two employees of the disposal company concerned are Mak Kim-kwan and Lin Wenjian, respectively truck driver and worker of T.S. Industrial Materials Recycle Limited (TSL).The six people jointly face one count of conspiracy to defraud, contrary to Common Law. Mak Kim-kwan alone faces four counts of offering an advantage to an agent, contrary to Section 9(2)(a) of the Prevention of Bribery Ordinance (POBO). Meanwhile, Mak Wah-sing, Chung Pui-chun and Cheung Kam-ning each faces one count of agent accepting an advantage, contrary to Section 9(1)(a) of the POBO.All defendants were released on ICAC bail, pending their appearance in the Eastern Magistrates’ Courts on Thursday (June 13) for mention. The prosecution will apply to transfer the case to the District Court for plea.At the material time, Far East was engaged by the EPD to operate a landfill in Fanling for disposal of construction waste and non-construction waste, including municipal waste. Trucks disposing construction waste were required to use the construction waste entrance and produce chits issued by the EPD to weighbridge operators for settling the disposal charge, which was $200 per tonne. Meanwhile, disposal of non-construction waste was free of charge.Weighbridge operators of Far East would conduct routine inspection on trucks using the non-construction waste entrance and weigh those trucks to verify whether construction waste was loaded on them. EPD staff would also conduct ambush inspections on trucks entering the landfill.TSL was a waste disposal company which operated a waste recycling site in Fanling. It conveyed construction waste to the landfill for its client.It is alleged that between January 2021 and June 2022, the six defendants conspired together to defraud the EPD by dishonestly disguising construction waste to be unloaded by trucks of TSL as non-construction waste for disposal; alerting in advance Mak Kim-kwan when inspection was to be carried out by the EPD and enabling trucks of TSL to evade payments for disposal of construction waste at the landfill.In the abovementioned one and a half years, Mak Kim-kwan allegedly offered laisees, coupons and bottled drinks to four employees of Far East, including Mak Wah-sing, Chung Pui-chun and Cheung Kam-ning, so as to alert him in advance when the EPD was to carry out inspections and facilitated construction waste conveyed to the landfill by trucks of TSL to be disposed of without payment of the required fees. Meanwhile, Mak Wah-sing, Chung Pui-chun and Cheung Kam-ning allegedly accepted those advantages from Mak Kim-kwan.The ICAC investigation arose from a corruption complaint. Enquiries revealed that at the material time, TSL offered laisees, mooncake coupons and rice dumpling coupons worth totalling about $50,000 to Far East staff, and provided a large quantity of non-alcoholic bottled drinks to Far East staff on a daily basis.ICAC enquiries also revealed that non-construction waste was used to cover construction waste loaded on TSL trucks. By pretending that its trucks were uploading non-construction waste, TSL evaded making the relevant waste disposal payments.In around a month between mid-May and mid-June 2022, TSL declared to the EPD that it had conveyed non-construction waste on about 760 occasions. ICAC enquiries revealed that about 90 per cent of the trucks were disguised as carrying non-construction waste. A total of over 4,100 tonnes of construction waste, incurring disposal charge of over $830,000, were in fact loaded on the trucks.The EPD and Far East have rendered full assistance to the ICAC during its investigation into the case.The ICAC reminds staff of business organisations not to be tempted by trivial advantages and breach the law inadvertently. According to the Prevention of Bribery Ordinance, an advantage includes, irrespective of the value, any money, gift, loan, contract and services, etc. Offeror and recipient of the bribe may breach the law as long as a corrupt motive is involved.