Hong Kong court slaps jail time on four people over plot to defraud Convoy, in a win for city's anti-corruption investigator

Asia's Tech News Daily

Enigma Network, a joint investigation in December 2017, the stage of a boardroom tussle, combined loss of HK$2.6 billion

Three former executives of Convoy Financial Service Holdings and a local broker were sentenced to up to seven months in prison, as Hong Kong wrapped up its four-year investigation into the city’s biggest financial malfeasance in decades.

Convoy’s former executive director Mak Kwong-yiu was jailed for seven months, while former Gransing Securities general manager Lee Yick-ming was sentenced to five months in prison, Hong Kong’s Independent Commission Against Corruption (ICAC) said in a statement on Saturday. Mak, 47, was also banned from holding any corporate directorship for three years, the ICAC said.

Convoy’s former financial controller Christine Chan Lai-yee was sentenced to five months in prison while former manager Wong Shuk-on received a four-month jail term, both getting an 18-month deferment in serving their sentences, ICAC said.

The sentencing of the four accused, after being found guilty by the District Court last month of conspiring to cheat Convoy of HK$51 million (US$6.8 million) in commissions from four bonds sold between 2014 and 2015, is the epilogue of the biggest financial fraud case in Asia’s financial hub in decades. Convoy is the centrepiece of the so-called Enigma Network, a group of up to 50 companies hidden by layers of cross holdings and opaque corporate structures that regulators claim have conspired to entrap minority investors.

Enigma Network, a joint investigation in December 2017, the stage of a boardroom tussle, combined loss of HK$2.6 billion

Convoy’s former financial controller Christine Chan Lai-yee was sentenced to five months in prison with an 18-month deferment at the District Court in Wan Chai on 16 October 2021. Photo: Dickson Lee

The ICAC and the Securities and Futures Commission (SFC) commenced a joint investigation in December 2017 into alleged fraud at Convoy, cracking down on malfeasance to restore investors’ confidence in corporate governance in Asia’s financial hub.

The city’s Hang Seng Index stock benchmark is among the world’s worst-performing major equity markets this year, as Beijing’s regulatory crackdown on everything from e-commerce to ride-hailing triggers an exodus of capitals.

Enigma Network, a joint investigation in December 2017, the stage of a boardroom tussle, combined loss of HK$2.6 billion

Convoy’s former manager Wong Shuk-on received four months’ jail sentence with an 18-month reprieve at the District Court in Wan Chai on 16 October 2021. Photo: Dickson Lee.

“The ICAC will continue to collaborate with relevant regulatory bodies, including the SFC, to combat corrupt and illicit activities in the financial market so as to uphold the integrity of the market, maintain a level playing field for businesses, and sustain Hong Kong’s status as an international financial centre,” the anti-corruption agency said in the statement. “The ICAC has made continuous and proactive efforts in assisting listed companies in enhancing their corporate governance.”

Mak and his three associates conspired to hire Gransing Securities to arrange Convoy’s four bond placements in 2014 and 2015, according to court proceedings. The brokerage secretly hired Convoy Investment Services (CIS), in which Mak and two other former Convoy executive directors held significant stakes, to help sell the debts. In return, CIS received HK$49.6 million in commission and HK$1.2 million in bonus. The details on the bond offerings were never disclosed to Convoy’s board of directors and the company’s shareholders, according to court papers.

Such behaviours constituted a conflict of interest that harmed the interest of shareholders and obstructed the law enforcements of the financial regulators, ICAC said in the statement.

Convoy was expelled from the main board of Hong Kong’s stock exchange in May after failing to meet the bourse operator’s listing condition. Trading in the stock had been halted since December 2017 when the fraud investigations began.

The company is also the stage of a boardroom tussle involving one of Taiwan’s wealthiest families, and a property magnate in southern China. The company’s largest shareholder, with a 29.98 per cent stake, is Richard Tsai Ming-hsing of Taiwan’s Fubon Financial Holdings. Fighting for control of Convoy is Kwok Hui-kwan, the son of Shenzhen property magnate Kwok Ying-shing, who owns 29.91 per cent of the company. The Kwoks have solicited the help of Hong Kong’s former minister and MTR Corporation chairman Fred Ma to fight on their behalf.

Convoy, one of the largest financial managers of Hong Kong’s mandatory pension fund, reported a combined loss of HK$2.6 billion for the three years from 2017 to 2019.

“We are pleased to see the criminal outcomes achieved in the case, which proves the effectiveness of our strategy to collaborate with other law enforcement agencies in [fighting] serious corporate fraud cases,” the SFC’s executive director of enforcement Thomas Atkinson said in a statement after the sentencing.

Internet Explorer Channel Network
Asia's Tech News Daily
News Related


Elizabeth Holmes accuses ex-boyfriend, Theranos partner of forced sex

Much of Holmes’ defense has focused on the idea that Ramesh “Sunny” Balwani was really the one running the company. Yichuan Cao/Sipa USA/Sipa via AP Images Elizabeth Holmes — the ... Read more »

Stocks making the biggest moves premarket: Regeneron, Moderna, Dollar Tree and more

Check out the companies making headlines in premarket trading. Regeneron Pharmaceuticals (REGN) — Regeneron shares fell more than 1% in the premarket after the company said its Covid-19 antibody cocktail ... Read more »

Facebook must sell Giphy from British regulator

The British Competition and Markets Authority (CMA) is demanding that Facebook sell the GIF platform Giphy. The competition authority announced this on Tuesday. The CMA believes the acquisition could harm ... Read more »

TRAI releases consultation paper to discuss pricing, modalities for auction of 5G spectrum

Telecom regulator TRAI on Tuesday released a detailed consultation paper to discuss modalities for auction of 5G spectrum bands, including pricing, quantum and related conditions. The Telecom Department has asked ... Read more »

TSB to close 70 more branches - is yours one of them?

The closures next year will leave the bank's network around a third of the size of when the brand returned to the high street eight years ago. Read more »

Putin orders to ensure protection of personal data during digitalization processes

According to the head of state, the process of digital transformation, which involves the introduction of new technologies in all areas of life, should have a serious impact on national economic development, leading to a rise in productivity and people’s incomes Read more »

Q2 GDP data | Private consumption, government spending rise sharply

Representative Image Household consumption rose in the second quarter (July-September) of FY22 despite the second wave of the Covid-19 pandemic, boosting hopes of a quicker recovery in consumer demand in ... Read more »

Zara founder's daughter to lead parent company Inditex in surprise reshuffle

MADRID (REUTERS) – Marta Ortega, daughter of the founder of Spanish fashion retailer Inditex, will replace chairman Pablo Isla, who led the company’s global expansion for more than a decade, ... Read more »

RBI appoints advisory committee to assist Reliance Capital administrator

Reliance Capital is part of Anil Ambani-headed Reliance Group (File image) The Reserve Bank of India (RBI) on November 30 said it has appointed an advisory committee to advise the ... Read more »

Oil prices plummet in November due to concerns about Omikron

Photo: ANP Oil prices fell sharply in November, mainly due to concerns about the new Omikron variant of the corona virus and its possible impact on oil demand. Prices have ... Read more »

Edelweiss Financial Services' board approves fundraising up to Rs 1,000 crore via NCDs

Representative image Edelweiss Financial Services’ board has approved a public issue for raising up to Rs 1,000 crore through non-convertible debentures, half of which will be mopped up in the ... Read more »

What year is it? Here's why everyone is talking about Microsoft stock again

Microsoft (NASDAQ: MSFT) recently became a hot topic after CEO Satya Nadella sold more than half of his shares for about $285 million on Nov. 22 and 23. According to ... Read more »

Q2 GDP: Indian economy grew 8.4% in July-September quarter

Representative image India’s gross domestic product (GDP) in the second quarter of the fiscal year 2021-22 grew at 8.4 percent, official data released on November 30 showed. The numbers mark a ... Read more »

Taking Stock | Sensex down 196 points, Nifty below 17,000; consumer durables and FMCG gain

Sensex | Representative image Indian equity benchmarks ended lower amid volatility on November 30 as concerns over the Omicron variant of the coronavirus weighed on the market even as IT and healthcare ... Read more »

Maruti Suzuki hikes prices of Eeco van by Rs 8,000

Maruti Suzuki Eeco Maruti Suzuki India on Tuesday said it has increased prices of all non-cargo variants of its Eeco van by Rs 8,000 owing to the introduction of passenger ... Read more »

Tencent opens super app WeChat to Chinese e-commerce rivals amid inexorable regulatory pressure, analysts say

Tencent Holdings’ recent move to open up its ubiquitous super app WeChat to shopping links from external platforms marks a major victory for Chinese regulators, as Big Tech companies bow ... Read more »

UK regulator orders Facebook to sell Giphy

Source: Reuters A British regulator on Tuesday ordered Facebook to sell Giphy, assessing that its acquisition of the animated graphics startup would hit competition and advertising. The Competition and Markets ... Read more »

Explainer| Why Kerala is upset with the RBI on regulation of cooperative banks

Kerala Legislative Assembly On November 22, the Reserve Bank of India (RBI) issued a circular that warned cooperative societies about using the word ‘bank’ in their names and accepting deposits from ... Read more »

Eight core industries growth rises by 7.5% in October

Representational image The combined output of eight core industries has surged by 7.5 percent in October, as compared to the same period last year, showed the official data released on November ... Read more »

'I can't even afford to buy a cart of groceries': Spiraling inflation leaves some grocery workers struggling

The gap between hourly wages and the cost of food means many grocery workers often face the daily experience of being around food they can’t afford. Read more »

Omicron already playing havoc with travel and tourism

The latest Covid-19 variant has introduced new concerns and restrictions into travel plans. Read more »

Barbados bids farewell to British monarchy, becomes republic

The Associated PressBarbados’ new President Sandra Mason, center right, awards Prince Charles with the Order of Freedom of Barbados during the presidential inauguration ceremony in Bridgetown, Barbados on Tuesday Nov. ... Read more »

Inflation fears and corona concerns are pushing stock markets into the red

European stocks plunged into the red again on Tuesday after the rebound a day earlier. Concerns about soaring inflation in the eurozone and fears that existing vaccines will not work ... Read more »

Goldman downgrades Dollar Tree to neutral, says company's improvements are priced in

People walk past a Dollar Tree store on November 23, 2021 in Los Angeles, California.Mario Tama | Getty Images Shares of Dollar Tree are getting too expensive and investors should ... Read more »

Kremlin hopes there will be no threats to completion of Nord Stream 2 certification

Dmitry Peskov emphasized that the certification and launch of Nord Stream 2 are in the interests of all European consumers Read more »

Reuben property billionaires plot £180m deal to fund Admiralty Arch hotel project

The Reuben family is on the verge of a £180m deal with Prime Investors Capital that would see it become a significant shareholder in the redeveloped Admiralty Arch site, Sky News learns. Read more »

Eight core industries growth rises to 7.5% in October

The growth of eight core industries has surged by 7.5 percent in October 2021 as compared to the same period last year, showed the official data released on November 30. ... Read more »

Go Fashion shares close 81% higher on debut despite market volatility

Go Fashion India IPO Shares of Go Fashion, the operator of Go Colors brand, remained strong throughout the session, and closed 81.5 percent higher on the day of the stock’s debut amid ... Read more »

Credit growth to industry picked up in October, shows RBI data

Representational image. Credit growth to industry picked up to 4.1 percent in October 2021 from a contraction of 0.7 percent in October 2020, according to the latest data from the ... Read more »

What is known about new Twitter boss Parag Agrawal?

Read more »

Volvo Cars built 50,000 fewer cars due to chip shortage

Photo: ANP Swedish car maker Volvo Cars has built 50,000 fewer cars in the third quarter compared to a year earlier due to chip shortages that have plagued the global ... Read more »

STI falls 2.5% in single largest decline in a year amid Omicron variant fears

Decliners outnumbered advancers 338 to 172, with 3.22 billion shares worth S$3.89 billion changing hands. SINGAPORE (THE BUSINESS TIMES) – The Straits Times Index (STI) saw its largest single-day decline ... Read more »

Inflation in 19 nations using euro hits record high of 4.9%

The Associated PressFILE – People fill up the shopping streets in Cologne, Germany, Wednesday, Nov. 17, 2021. Official figures show that consumer prices across the 19 countries that use the ... Read more »

Why K-pop stars could be like Nick Jonas and Ariana Grande and use Broadway as a path to success in the US

For years, K-pop stars have performed in musicals in South Korea. Now some are using Broadway as an alternative route into the American music market. Luna (Park Sun-young), known primarily ... Read more »

Zee-Invesco court war: Division bench adjourns hearing, no date given so far

ZEEL | Representative image The division bench of the Bombay High Court headed by Justice SJ Kathawalla and Milind Jadhav adjourned the hearing on the Zee Entertainment and Invesco matter ... Read more »

Centre's April-October fiscal deficit at 36.3% of Budget estimates for FY22

(Representative Image) The Centre’s fiscal deficit during April to October, that is the first seven months of the year, is well below last year’s at Rs 20,200 crore as against ... Read more »

Buy IndusInd Bank: target of Rs 1340: Sharekhan

Sharekhan’s research report on IndusInd Bank IndusInd Bank’s promoters may look forward to increase its stake to 26% from currently at 16.54% (as September 2021). The bank continued its Digital ... Read more »

How DHL is navigating supply chain challenges

Read more »

‘I'm concerned but I'm not panicking,' says NYU epidemiologist on the omicron variant

Dr. Celine Gounder, epidemiologist and professor at NYU, urged Americans to get vaccinated and boosted as the best way protect themselves until it becomes clear how well the current Covid ... Read more »

Dutch inflation rate rises to 5.6%, well above eurozone average

Photo: Depositphotos.com The Dutch rate of inflation has risen again to 5.6%, according to new figures published on Tuesday by EU statistics agency Eurostat. In October, inflation in the Netherlands ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic