Shareholders seek probe of Citic Pacific management
More than 100 respond to lawmaker's plea for action
Controversy surrounding the management of Citic Pacific took a political turn yesterday, as more than 100 shareholders expressed a desire to petition the financial secretary to initiate a broad investigation of the company's management.
A Citic Pacific statement yesterday announced that managing director Henry Fan Hung-ling had taken leave of absence from his roles with the stock exchange and the Securities and Futures Commission until the completion of an SFC investigation.
But the Democratic Party yesterday urged him to step down from the SFC permanently and also consider his position in the Executive Council.
Lawmakers also warned the authorities that any perceived leniency towards Mr Fan or Citic Pacific, the Hong Kong arm of the mainland's largest state-owned investment company, would lead to the conclusion there was political intervention.
Democrats chairman Albert Ho Chun-yan said: 'He is obviously involved in the management of the company and in making the decision of when the disclosure should be made ... this alone casts doubt on his ability and judgment which might undermine the integrity of the SFC.'
He described Mr Fan's defence, that he had followed legal advice, as 'shocking'.
'If you have done something wrong, you have done something wrong. He, of all people, should know the fact you sought legal advice is no defence, and he should be even more acutely aware of the responsibility of disclosure,' Mr Ho said.
With an Exco reshuffle looming, Mr Ho urged Chief Executive Donald Tsang Yam-kuen to reassess whether to reappoint Mr Fan.
Mr Fan's involvement in delaying the disclosure of the company's unauthorised currency bets, which could lose it HK$15.5 billion, is facing further scrutiny.
More than 100 investors responded to a plea yesterday afternoon by Mr Ho through a radio programme for any investors, who had bought shares in mid-September and had since suffered a loss because of the delayed disclosure, to come forward.
According to the Companies Ordinance, the financial secretary may appoint independent inspectors to investigate a company after an application by 100 or more shareholders.
Mr Ho said such an investigation would have broader powers to look into the management of the company and could open its hearings to the public.
'If after the application of over 100 investors, the government refuses to initiate this investigation without good reason, then the public will come to the conclusion there has been a political intervention,' Mr Ho said. 'Not only will Hong Kong's image of a financial services hub be affected, but also our commitment to the 'one country, two systems' [principle],' he said.
Civic Party leader Audrey Eu Yuet-mee said the SFC investigation should be sufficient if it gave a clear explanation. She also refused to echo calls for Mr Fan to step down from the SFC permanently.
Lau Kong-wah, of the Democratic Alliance for the Betterment and Progress of Hong Kong, said Mr Fan should decide on the future of his public roles.
