HK tycoon must stand trial over La Scala bribe
Hong Kong property tycoon Joseph Lau Luen-hung has been ordered to trial in Macau in September over accusations he and another developer paid a HK$20 million bribe to secure prime land for luxury flats.
In a statement filed last night with the Hong Kong stock exchange, Lau's publicly listed Chinese Estates confirmed that Macau's Court of First Instance served him papers yesterday ordering him to appear for trial on September 17.
The statement said Lau had for now retained his role as executive director. It did not say whether he intended to go to Macau to face the charges for bribery and money laundering.
Iau Teng-pio, a law professor from the University of Macau, said Lau could escape jail time if he stayed away from Macau because the city had no extradition treaties.
'The Macau government cannot demand that the Hong Kong police and government help with arrests,' Iau said.
The trial comes as little surprise since allegations against Lau played a central role in the recently concluded corruption trial against former Macau public works chief Ao Man-long.
Ao was sentenced last month to 29 years in prison for taking the bribe, which prosecutors said Lau and fellow tycoon Steven Lo Kit-sing paid in 2005 to advance the La Scala project near Macau's airport.
Investors may nonetheless see confirmation of the trial as damaging since Lau and his family retain control over Chinese Estates. The company could not be reached for comment.
Ricky Tam Siu-hing, a director at Champlus Asset Management, said the company's share price would face pressure when the market opened today.
But Tam did not expect the stock to fall drastically because accusations about Lau's involvement had already come out in Ao's trial and the Lau family held 75 per cent of the shares.
'Not many institutional investors have its shares,' Tam said. 'So I don't think there will be a strong wave of panic selling.'
Chinese Estates shares were priced at HK$11 last month before it was revealed that he would face the charges, and have since hovered around HK$9. The company's stock ticked up two cents to HK$8.98 at the close of trading before the announcement came out.
The company had sold 300 of the 4,000 flats planned for the La Scala project before cutting off sales and construction in recent weeks.
Chinese Estates has said it will take legal action to stop the Macau government from invalidating the land purchase, and that it was 'determined' to pursue compensation claims if it happened.