Allowance abuse a familiar story

PUBLISHED : Friday, 06 July, 2012, 12:00am
UPDATED : Friday, 06 July, 2012, 12:00am


The accusation against Secretary for Development Mak Chai-kwong of abusing the civil-service rental allowance in the 1980s is not an isolated case. In the past 12 years, four people have been convicted in three cases.

Mak denied he abused the scheme yesterday after a newspaper report said he received an allowance to help pay his rent while he was leasing a property that he owned to another civil servant. Both flats were in the same private housing estate, City Garden in North Point.

In December 2000, former deputy commissioner of the Inland Revenue Department Agnes Sin Law Yuk-lin was convicted of defrauding the government of HK$330,000 in rental allowances between 1983 and 1986.

She was found guilty of one count of using a document with intent to deceive the government. She and her husband, Sin Kam-chuen, a Civil Engineering Department official, each received jail terms of nine months, which were suspended for two years. Agnes Sin repaid the HK$330,000 and an undisclosed financial penalty.

The Sins bought a North Point property in 1983 through a shelf company called Takestep. A flat in the same estate was bought by their friend, Fan Sai-yee, and his wife via another shelf company, Rocksona Trading Company (HK). After the purchases, shares were swapped between the two companies.

Agnes Sin had declared in her allowance application that the flat they were renting was not owned by any member of their family, and that they had no financial interest in it.

District Court judge Derek Pang Wai-cheong said that by this statement, the couple had intended to deceive the government. The Sins treated the flat as their own and had been responsible for the mortgage. He also found the parties had kept the proceeds after selling the flats.

The Sins believed they had not broken the law and had pleaded not guilty.

In May, former assistant director of lands Patrick Fan Yung-cheong, who retired in February, was found to have cheated the government out of more than HK$1.3 million in housing benefits between 1987 and 1995.

Fan, who was a surveyor at the time of the fraud, bought a flat in Taikoo Shing through a shell company he set up and claimed subsidies from his employer for 'renting' it.

He pleaded guilty to five counts of fraudulently claiming housing benefits and was sentenced to eight months in prison, suspended for two years. Fan repaid the subsidies and HK$2 million in interest.

Former deputy director of the now defunct regional services department Anthony Woo Sik-jan began receiving a HK$27,000 monthly mortgage allowance in 1991, but rented out his Happy Valley flat from March 1996 to November 1998 when he was posted overseas. In 2000, he was convicted of 33 theft charges and jailed for five months.