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An offence committed notwithstanding an incomplete corrupt deal
Terry had been a senior bank manager for five years. He had bought a flat at its peak value but unfortunately, the value of the flat had dropped by nearly $3 million during the economic downturn. Meanwhile, he had to pay exceptionally high monthly installments on the mortgage loan.
Mark was Terry's customer and planned to apply for overdraft facilities of $3 million from Terry's bank. According to the bank's policy, a branch manager was authorised to approve unsecured overdraft facilities of up to $3 million to a customer. While Terry was dealing with the overdraft application, Mark requested him to expedite the process and favourably recommend his application.
Taking into consideration his own upcoming mortgage repayment, Terry suggested Mark to place $100,000 into his personal bank account in return for his assistance in expediting Mark’s application. Mark acceded to the suggestion and Terry approved the application on the next day. Nevertheless, prior to the bank’s final processing of the application, the abnormal swift approval by Terry was brought to light by the bank’s compliance department and the case was eventually reported to the ICAC. Terry's authority to deal with all banking matters including Mark's application was immediately suspended pending investigation.
Case Analysis
Terry breached Section 9 of the Prevention of Bribery Ordinance (POBO) as he abused his official position as a bank manager by expeditiously approving an application of overdraft facilities and solicited and accepted an advantage in return without permission from his employer. Likewise, Mark breached the POBO by offering an unlawful advantage to Terry. In this case, Terry also violated Section 124 of the Banking Ordinance.
Although the "under-the-table" deal had not been completed, Terry and Mark still committed an offence. Under the POBO, a person will be found guilty even though the purpose of bribery has not been achieved. Terry might also violate the Code of Conduct[1] of the bank by soliciting and accepting personal benefits from a customer.
[1] According to HKMA’s Supervisory Policy Manual CG-3, each authorized institute (bank) should develop its own Code of Conduct containing certain minimum conduct requirements which include “no member of staff should solicit, accept and retain personal benefits from any customer of the authorized institute (bank) or any individual or organisation doing or seeking to do business with it.”