LIVE: Prosecution questions Hui's signed 'true, correct and complete' tax return forms
The trial of two of the city's wealthiest tycoons and Hong Kong's former No 2 government official resumes today, as the prosecution continues its opening statement.
Rafael Hui Si-yan, 66, faces eight charges related to bribery and misconduct in public office.
Sun Hung Kai Properties (SHKP) co-chairman Thomas Kwok Ping-kwong, 62, faces one charge of conspiracy to offer an advantage to Hui and two counts of conspiracy to commit misconduct in public office. Raymond Kwok Ping-luen, 61, also co-chairman, faces four charges, including one with Hui of furnishing false information.
SHKP executive director Thomas Chan Kui-yuen and former Hong Kong stock exchange official Francis Kwan Hung-sang each face two charges. All have pleaded not guilty.
5.05pm: That's all for today's live blog. We will continue to bring you the best of the trial as and when it happens.
4.50pm: Perry says in March 2005 Raymond Kwok was very concerned about political turmoil on speculation that Tung Chee-hwa would resign as the then Chief Executive, to be replaced by the then Chief Secretary Donald Tsang, while Hui was tipped to replace Tsang as Chief Secretary. When Tung resigned on March 10, Raymond wrote in his diary, "Tung resigning. Good. A lot of energy". Raymond Kwok was happy to see his old friend of 20 years Hui was back in the government, the prosecutor said. The case is adjourned.
4.20pm: From July 2005 to December 2007, Hui paid HK$4.8 million in rent under the new tenancy agreement. But Thomas Chan arranged for his company Villalta to pay the money back to Hui through Francis Kwan.
4.05pm: On June 27, 2005, just days before becoming chief secretary, Hui pays two months' deposit and one month's rent, totalling HK$480,000. However, on the same day Francis Kwan pays HK$1 million into Hui's personal bank account in the form of two cheques each worth HK$500,000.
3.56pm: Perry said the Kwok brothers did "not want to look mean" so they agreed to pay the HK4.125 million fee to Hui for the remaining 11 months of his contract, despite the fact he cannot provide services after becoming Chief Secretary. As his contract with SHKP was ending a new tenency agreement was drawn up to increase the rent on each flat from HK$55,000 to HK$80,000.
3.44pm: Hui was appointed as director of a number of subsidaries of SHKP in 2004, Perry said, but resigned the following year. "On 1st May 2005 Hui resigned, a few days after, the cheque for HK$4.125 million was brought into existence," he said. Perry said even though Hui had brought to an end to his consultancy agreement with SHKP, his link with the company remained as he continued to live in the Leighton Hill flats. "It is more complicated as he has been living rent-free," Perry added.
3.05pm: Prosecutor David Perry continues his opening, to address the accommodation situation at Leighton Hill. Perry tells the jury that there were no tenancy agreements for Hui until November 2003, even though he and his wife had moved into the flat as early as February 14, 2003. The tenancy for Flat 20A was signed on November 26, 2003, by Hui's company and the Kwok's family's private company, as the owner. The tenancy gave a restrospective effect back to April 2003. It carried a term of 12 months with a monthly payment of HK$55,000. A similar tenancy agreement was signed for Flat 20B between Hui's company and a public arm of SHKP as the owner of the flat, also on a monthly rental basis of HK$55,000. Flat A was owned by the Kwoks' private company, while Flat B was owned by SHKP's public arm. Perry said the rental for Flat A was absorbed by the private company, but the rental for Flat B was paid by Raymond and Thomas Kwok because it could not be absorbed by the public company.
2.30pm: All parties return to the court following a lunch break, prepared to hear fresh allegations from prosecutors.
12.55pm: Hui also told investigators that he had not paid rent at Leighton Hill at one point in 2003 because a pipe in the bathroom had burst and that it had "flooded the floor and caused extensive damage to the floor andd the furniture". Hui alleged it took weeks to repair the damage, Perry said, adding that Hui had written to SHKP to express his displeasure.
12.47pm: Hui told the ICAC investigator he had not paid the HK$60,000 rent on the Leighton Hill property because he was negotiating a consultancy agreement and the accommodation formed part of the remuneration package, pending a final deal. In September 2003, when the contract was being finalised the rent became part of his consultancy pay package.
12.35pm: Perry outlines a timeline of events on Hui's negotiations on the consultancy agreement with SHKP. He says Hui handed in his MPFA resignation at the end of 2002, with a leaving date of August 2003. He says he planned to set up a consultancy firm to advise clients on areas such as politics and the economy. A number of people approach Hui to begin negotiations on his consultancy plans from early 2003, including the three Kwok brothers. Walter Kwok is less involved in the negotiations, for reasons not known to Hui, the prosecutor says.
12.15pm: Perry tells the jury that Hui was contacted by ICAC in late 2009 to provide information relating to allegations of his acceptance of rent-free accommodation at Leighton Hill and unsecured loans of HK$900,000 and HK$1.5 million, as well as negotiations on the consultancy agreement with SHKP. Hui signed his ICAC statement in January 2010. The prosecution alleges that anti-graft agency was not fully aware of deals struck between Hui and the other defendants, although was probing a HK$4.125 million payment Hui allegedly received in 2005.
11.25am: The consultancy agreement, Perry said, had several points of note. The agreement stated that Hui would act to serve two of the three Kwok brothers - the bosses of SHKP - but would exclude the eldest of the three siblings, Walter Kwok. Perry said when the contract was signed in March 2004, it stated that Hui would act as consultant only to Thomas and Raymond Kwok, and that a confidentiality clause between the three was included.
11.15am: Perry asks the jury to look at documents relating to details of Rafael Hui negotiating the MPFA's HK$10 million One IFC contract renewal in his capacity as a consultant-to-be of SHKP in 2003 - when he was still managing director of the MPFA. The prosecution says he started negotiations with SHKP to act as a consultant in March 2003, in return for a HK$10 million fee and rent-free use of two flats in Leighton Hill. However, he did not step down as MPFA managing director until August 2003. The two-year consultancy contract was due to begin in November 2003. Furthermore, he started to move into the Leighton Hill property as early as February 2003, before negotiations had even started, it is alleged.
11.04: David Perry QC says that SHKP was one of the landlords of One IFC, where the Mandatory Provident Fund Schemes Authority (MPFA) was located. MPFA was considering the renewal of its lease when Rafael Hui was the managing director of the authority. Perry said there was a "serious conflict of interest" as there was a consultancy negotiation between Hui, when he was the authority's managing director, and the Kwok brothers. "The prosecution cannot tell exactly when the negotiation began. But it can possibly be as early as in 2001...," Perry says. "[The] prosecution can tell that by mid-2002 they reached a stage that a draft agreement was proposed."
10.37am: The prosecution shows the jury a number of tax return documents, dated 2004 to 2009. On each annual tax return form Hui has signed the declaration to state the information given is "true, correct and complete". Perry, however, then alleges that his tax returns make no mention of receiving HK$5 million from Thomas Kwok in April 2005; receiving payments totalling HK$8.5 million during the four days leading up to his becoming the Chief Secretary in June 2005, and HK$11.182 million received in late 2007.
10.29am: Perry alleges that Rafael Hui concealed from the Independent Commission Against Corruption a payment received in 2007 and "tried to mislead the investigator". The prosecutor says Thomas Chan and Francis Kwan also tried to mislead investigators over payments to Hui. He says a document was drawn up which categorised the payment "as investment, which clearly [it was] not".
10.07am: Here we go again, as Hong Kong's most high-profile corruption trial enters a fresh week. Prosecutor David Perry strides into the courtroom with a smile and is now giving the jury a quick recap on the allegations made last week. The weekend hasn't dimmed the media's appetite for the trial, with scores of reporters and TV crews continuing their coverage. Once again all defendants are seated in the dock wearing suits and ties.