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Ethical Decision MakingRecent ICAC Cases
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Dec 2024Thirty-eight months’ jail for SME proprietor charged by ICAC over $3.8m loan fraud by overstating payroll expensesA proprietor of a Small and Medium Enterprise (SME), charged by the ICAC, was today (December 3) sentenced to 38 months’ imprisonment at the District Court for deceiving a bank into approving a loan of over $3.8 million under the Special 100% Loan Guarantee (SLG) scheme by overstating the number of staff employed by the company and its payroll expenses.Tony Fung Kam-fai, 45, proprietor of Dragon Win Motors China Company Limited (Dragon Win Motors), earlier pleaded guilty to one count of fraud, contrary to section 16A(1) of the Theft Ordinance.In sentencing, Judge Mrs Adriana Noelle Tse Ching remarked that the present case was serious in nature, and reprimanded the defendant for committing a fraud offence involving a substantial amount of money premeditatedly. The scheme would have continued if the defendant’s misdeeds were not detected.The court took a starting point of 45 months’ imprisonment. The defendant’s jail term was only reduced by 15 per cent as his guilty plea was entered after the trial commenced. Having considered other mitigating factors, the defendant was sentenced to 38 months’ imprisonment. The Judge added that the defendant had only himself to blame for his conviction and jail term received.The ICAC investigation arose from a corruption complaint, which subsequently revealed the above illicit SLG loans fraud. A total of six SME proprietors were charged in separate cases involving loans totalling about $19 million. Apart from Fung, two other defendants were earlier sentenced to 24 months’ and 22 months’ imprisonment respectively, following their guilty pleas. Another three defendants had their cases adjourned to February to May next year for plea, trial and verdict.The ICAC has been committed to maintaining a clean business environment in Hong Kong and providing integrity training for different industries. Business operators are reminded not to commit bribery or engage in illegal activities. For more information about the corruption prevention resources, please visit the webpage of "SMEs and Start-ups" under Hong Kong Business Ethics Development Centre.The court heard that in April 2020, HKMC Insurance Limited (HKMCI) launched the SLG under the SME Financing Guarantee Scheme to ease SMEs’ cash flow pressure under the pandemic. Loans approved by lenders were fully guaranteed by the government, of which the maximum facility amount was an SME’s total amount of wages paid to employees and rental payments for six months, or $4 million, whichever was the lower. Applicants were required to provide the lenders with the relevant proofs.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, Standard Chartered Bank would forward the application to HKMCI for final review and approval to grant a guarantee.In August 2020, the defendant submitted an SLG application to Standard Chartered Bank, supported by two Mandatory Provident Fund (MPF) statements and records of contributions showing that Dragon Win Motors had made MPF contributions for nine employees in July 2020. In various relevant documents, the defendant confirmed that all the information which he provided was true and correct. Standard Chartered Bank subsequently granted a loan of over $3.8 million, which was granted a guarantee by HKMCI, to Dragon Win Motors.The ICAC investigation revealed that the defendant had made false representations about the salaries of himself and other employees in the two MPF statements submitted to Standard Chartered Bank. One of the employees concerned received a monthly salary of about $20,000, but the defendant falsely represented that the amount was $91,000.The defendant also admitted that he was not acquainted with the persons claimed to be his employees in the statements. ICAC enquiries also revealed that two days before the loan application submission, the defendant prepared an MPF employee registration form claiming that the employees joined the company in either April or May 2020 so as to produce false records of MPF contributions.After the loan was approved, the defendant reported to the MPF trustee that the employees concerned had resigned within the first 60 days of their employment. Dragon Win Motors was hence refunded all the relevant MPF contributions.The HKMCI and Standard Chartered Bank rendered full assistance to the ICAC during its investigation into the cases.The prosecution was today represented by Senior Public Prosecutor Ivan Shiu, assisted by ICAC officer Jasmine Chan. 28
Nov 2024Investment entrant fraud: Immigration consultant charged by ICAC faces 10 additional charges, four clients and an employee indictedThe ICAC had earlier charged a former proprietor of an immigration consultancy for allegedly conspiring with a client to deceive the Immigration Department (ImmD) into granting an investment entrant application by making false representation about the latter’s investment of HK$10 million in Hong Kong. Ten additional charges were laid against the proprietor yesterday (November 27) as enquiries by the Commission revealed that he was also implicated in other similar schemes. Meanwhile, four investment entrant applicants and an employee of the immigration consultancy concerned were also charged.Tam Chi-ming, 50, former sole director-cum-shareholder of Wealth Concepts Consultancy (Greater China) Limited (Wealth Concepts), was charged in June this year with one count of conspiracy to defraud, contrary to the Common Law. Upon receipt of further legal advice from the Department of Justice, Tam was charged with another 10 counts of similar offences yesterday.Four investment entrant applicants, aged between 44 and 51, namely Li Ju, Wei Xinwen, Lu Junkai and Cao Hongguang; and an immigration consultant of Wealth Concepts, Su Dajie, 38, were each charged with one count or two counts of conspiracy to defraud.The six defendants were released on ICAC bail, pending their appearance at the Kowloon City Magistrates’ Courts tomorrow (November 29) for mention. The prosecution will later make an application for transferring the case to the District Court for plea.In 2003, the Hong Kong Government implemented the Capital Investment Entrant Scheme (the Scheme) to facilitate the entry for residence by capital investment entrants. The ImmD was responsible for processing the relevant applications. An applicant to be granted a permission to stay in Hong Kong for two years must have net assets of a market value not less than HK$10 million throughout the two years preceding the application; and remain invested not less than HK$10 million in specific permissible investment asset classes within six months after the granting of approval-in-principle by the ImmD (the remain-invested requirement). Applicants may apply for permanent residency of Hong Kong or unconditional stay in Hong Kong respectively upon continuous ordinary residence of or investment in Hong Kong for not less than seven years.Applicants were prohibited from borrowing money for holding specified financial assets. In accordance with the remain-invested requirement, applicants were also not allowed to assign any interest in favour of others in the financial assets concerned. The Scheme was suspended in 2015.At the material time, Tam was the sole director-cum-shareholder of Wealth Concepts, which provided consultancy services to individuals for immigration to Hong Kong. Su was an immigration consultant of the company. At that time, a number of applicants of the Scheme engaged Wealth Concepts to handle their applications.Eight of the additional charges allege that between April 2016 and July 2024, Tam had conspired with eight applicants, including four co-defendants, Li, Wei, Lu and Cao, to defraud the ImmD, inducing the ImmD to grant their applications for immigration to Hong Kong and the subsequent extensions of stay in Hong Kong.False applications purporting to show that the eight applicants had met the investment requirement were allegedly submitted to falsely represent that they had each invested a total sum of HK$10 million in the bonds issued by a listed company in Hong Kong and remained the absolute beneficial owners of the investments.Another two additional charges allege that Tam and Su, a staff member of his company, conspired with another two applicants to defraud the ImmD, inducing the ImmD to grant their applications for immigration to Hong Kong and the subsequent extensions of stay in Hong Kong by similar means.The ICAC investigation arose from a corruption complaint. Enquiries revealed that the applicant did not have sufficient funds for meeting the relevant requirements on investment.Tam was earlier charged with one count of conspiracy to defraud. The case is scheduled for mention at the Kowloon City Magistrates’ Courts on February 13, 2025.An ICAC spokesperson noted that the Commission had kept reviewing various investment entrant and talent admission schemes with the relevant government departments so as to strengthen regulating the schemes to stamp out corruption or other malpractices. The ImmD had rendered full assistance to the ICAC during its investigation into the case.
Dec 2024Thirty-eight months’ jail for SME proprietor charged by ICAC over $3.8m loan fraud by overstating payroll expensesA proprietor of a Small and Medium Enterprise (SME), charged by the ICAC, was today (December 3) sentenced to 38 months’ imprisonment at the District Court for deceiving a bank into approving a loan of over $3.8 million under the Special 100% Loan Guarantee (SLG) scheme by overstating the number of staff employed by the company and its payroll expenses.Tony Fung Kam-fai, 45, proprietor of Dragon Win Motors China Company Limited (Dragon Win Motors), earlier pleaded guilty to one count of fraud, contrary to section 16A(1) of the Theft Ordinance.In sentencing, Judge Mrs Adriana Noelle Tse Ching remarked that the present case was serious in nature, and reprimanded the defendant for committing a fraud offence involving a substantial amount of money premeditatedly. The scheme would have continued if the defendant’s misdeeds were not detected.The court took a starting point of 45 months’ imprisonment. The defendant’s jail term was only reduced by 15 per cent as his guilty plea was entered after the trial commenced. Having considered other mitigating factors, the defendant was sentenced to 38 months’ imprisonment. The Judge added that the defendant had only himself to blame for his conviction and jail term received.The ICAC investigation arose from a corruption complaint, which subsequently revealed the above illicit SLG loans fraud. A total of six SME proprietors were charged in separate cases involving loans totalling about $19 million. Apart from Fung, two other defendants were earlier sentenced to 24 months’ and 22 months’ imprisonment respectively, following their guilty pleas. Another three defendants had their cases adjourned to February to May next year for plea, trial and verdict.The ICAC has been committed to maintaining a clean business environment in Hong Kong and providing integrity training for different industries. Business operators are reminded not to commit bribery or engage in illegal activities. For more information about the corruption prevention resources, please visit the webpage of "SMEs and Start-ups" under Hong Kong Business Ethics Development Centre.The court heard that in April 2020, HKMC Insurance Limited (HKMCI) launched the SLG under the SME Financing Guarantee Scheme to ease SMEs’ cash flow pressure under the pandemic. Loans approved by lenders were fully guaranteed by the government, of which the maximum facility amount was an SME’s total amount of wages paid to employees and rental payments for six months, or $4 million, whichever was the lower. Applicants were required to provide the lenders with the relevant proofs.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, Standard Chartered Bank would forward the application to HKMCI for final review and approval to grant a guarantee.In August 2020, the defendant submitted an SLG application to Standard Chartered Bank, supported by two Mandatory Provident Fund (MPF) statements and records of contributions showing that Dragon Win Motors had made MPF contributions for nine employees in July 2020. In various relevant documents, the defendant confirmed that all the information which he provided was true and correct. Standard Chartered Bank subsequently granted a loan of over $3.8 million, which was granted a guarantee by HKMCI, to Dragon Win Motors.The ICAC investigation revealed that the defendant had made false representations about the salaries of himself and other employees in the two MPF statements submitted to Standard Chartered Bank. One of the employees concerned received a monthly salary of about $20,000, but the defendant falsely represented that the amount was $91,000.The defendant also admitted that he was not acquainted with the persons claimed to be his employees in the statements. ICAC enquiries also revealed that two days before the loan application submission, the defendant prepared an MPF employee registration form claiming that the employees joined the company in either April or May 2020 so as to produce false records of MPF contributions.After the loan was approved, the defendant reported to the MPF trustee that the employees concerned had resigned within the first 60 days of their employment. Dragon Win Motors was hence refunded all the relevant MPF contributions.The HKMCI and Standard Chartered Bank rendered full assistance to the ICAC during its investigation into the cases.The prosecution was today represented by Senior Public Prosecutor Ivan Shiu, assisted by ICAC officer Jasmine Chan. 28
Nov 2024Investment entrant fraud: Immigration consultant charged by ICAC faces 10 additional charges, four clients and an employee indictedThe ICAC had earlier charged a former proprietor of an immigration consultancy for allegedly conspiring with a client to deceive the Immigration Department (ImmD) into granting an investment entrant application by making false representation about the latter’s investment of HK$10 million in Hong Kong. Ten additional charges were laid against the proprietor yesterday (November 27) as enquiries by the Commission revealed that he was also implicated in other similar schemes. Meanwhile, four investment entrant applicants and an employee of the immigration consultancy concerned were also charged.Tam Chi-ming, 50, former sole director-cum-shareholder of Wealth Concepts Consultancy (Greater China) Limited (Wealth Concepts), was charged in June this year with one count of conspiracy to defraud, contrary to the Common Law. Upon receipt of further legal advice from the Department of Justice, Tam was charged with another 10 counts of similar offences yesterday.Four investment entrant applicants, aged between 44 and 51, namely Li Ju, Wei Xinwen, Lu Junkai and Cao Hongguang; and an immigration consultant of Wealth Concepts, Su Dajie, 38, were each charged with one count or two counts of conspiracy to defraud.The six defendants were released on ICAC bail, pending their appearance at the Kowloon City Magistrates’ Courts tomorrow (November 29) for mention. The prosecution will later make an application for transferring the case to the District Court for plea.In 2003, the Hong Kong Government implemented the Capital Investment Entrant Scheme (the Scheme) to facilitate the entry for residence by capital investment entrants. The ImmD was responsible for processing the relevant applications. An applicant to be granted a permission to stay in Hong Kong for two years must have net assets of a market value not less than HK$10 million throughout the two years preceding the application; and remain invested not less than HK$10 million in specific permissible investment asset classes within six months after the granting of approval-in-principle by the ImmD (the remain-invested requirement). Applicants may apply for permanent residency of Hong Kong or unconditional stay in Hong Kong respectively upon continuous ordinary residence of or investment in Hong Kong for not less than seven years.Applicants were prohibited from borrowing money for holding specified financial assets. In accordance with the remain-invested requirement, applicants were also not allowed to assign any interest in favour of others in the financial assets concerned. The Scheme was suspended in 2015.At the material time, Tam was the sole director-cum-shareholder of Wealth Concepts, which provided consultancy services to individuals for immigration to Hong Kong. Su was an immigration consultant of the company. At that time, a number of applicants of the Scheme engaged Wealth Concepts to handle their applications.Eight of the additional charges allege that between April 2016 and July 2024, Tam had conspired with eight applicants, including four co-defendants, Li, Wei, Lu and Cao, to defraud the ImmD, inducing the ImmD to grant their applications for immigration to Hong Kong and the subsequent extensions of stay in Hong Kong.False applications purporting to show that the eight applicants had met the investment requirement were allegedly submitted to falsely represent that they had each invested a total sum of HK$10 million in the bonds issued by a listed company in Hong Kong and remained the absolute beneficial owners of the investments.Another two additional charges allege that Tam and Su, a staff member of his company, conspired with another two applicants to defraud the ImmD, inducing the ImmD to grant their applications for immigration to Hong Kong and the subsequent extensions of stay in Hong Kong by similar means.The ICAC investigation arose from a corruption complaint. Enquiries revealed that the applicant did not have sufficient funds for meeting the relevant requirements on investment.Tam was earlier charged with one count of conspiracy to defraud. The case is scheduled for mention at the Kowloon City Magistrates’ Courts on February 13, 2025.An ICAC spokesperson noted that the Commission had kept reviewing various investment entrant and talent admission schemes with the relevant government departments so as to strengthen regulating the schemes to stamp out corruption or other malpractices. The ImmD had rendered full assistance to the ICAC during its investigation into the case.