Moulin ex-boss admits fraud plot
Cary Ma Lit-kin, the former chief executive of defunct eyewear firm Moulin Global Eyecare Holdings, has pleaded guilty to conspiring to publish a false financial statement in a company annual report, jurors were told yesterday. But he is contesting a second charge of conspiracy to defraud.
He, his father Ma Bo-kee (Moulin's former chairman) and six other defendants are being tried in front of a jury in the Court of First Instance.
The eight defendants face charges in a fraud case related to the former Hong Kong-listed firm, which once described itself as the world's third-largest eyewear manufacturer. They pleaded not guilty to charges ranging from conspiracy to defraud, publishing a false statement, making false instruments and dealing with the proceeds of indictable offences.
Ma Bo-kee founded the firm in 1960 as a sole proprietorship named Po Kwong Optical Trading. It listed in Hong Kong in 1993, but went into provisional liquidation in 2005, owing over HK$5 billion. It was liquidated in 2006 and delisted in 2007.
'As a listed company, if you didn't continue to prosper, what do you do? You make it up. This is a story of how they made it up. We are going to hear of companies that were created purely for dishonest trading, and some companies that have honest and dishonest trading,' the lawyer leading the prosecution, Audrey Campbell-Moffat, said.
Cary Ma admits conspiring with Ma Bo-kee, Tang Yiu-leung and one other person to publish in Moulin's 2003 annual report that its turnover was HK$1.24 billion. Ma Bo-kee and Tang pleaded not guilty to the charge.
Campbell-Moffat said HK$1.24 billon in revenue was inflated by HK$337.6 million in allegedly non-existent sales from fake North American companies.
'The figure was a pack of lies for lots of reasons. These people knew it's wrong,' she said. 'One way to increase turnover is to pretend you have customers you haven't got.
'The company had two accounting systems, which is very convenient if you are trying to be fraudulent.'
Before 2003, Cary Ma created several firms operating in North America, she said. 'They were bogus companies that operated out of residences and didn't trade anything.'
One witness was allegedly sent by Ma Bo-kee to meet auditors and pretend he was doing business with Moulin, Campbell-Moffat told the court. 'This was a completely bogus exercise. Oh what a tangled web you weave, when you start to deceive.'
Among the four charges Ma Bo-kee faces is one of conspiracy to defraud in 2005. He is alleged to have conspired with his son, Tang, Hui Hau-sang, Au Yuk-yin and Ng Hoi-sze to lie to Deloitte that a subsidiary of Moulin had more than 10 years of trading relations with firms such as California Eyewear.
Ma Bo-kee is also charged with conspiring with his son, Or Tak-yim, Chan Kong-ngai, Hui, Au, Ng and another person to defraud by making false invoices and shipping documents, which they furnished to CCIF CPA, which was Moulin's auditor in 2005.
The elder and younger Ma, Tang, Chan Po-ming and Lam Chun-wai plead not guilty to a charge of conspiracy to defraud 18 banks, including HSBC Holdings and Standard Chartered.
The defendants allegedly falsified invoices so that the banks would make payments to companies named in the invoices and to use the banks' credit facilities.
The trial continues today before Mr Justice Peter Line.
Number crunching
Revenue for Moulin Global Eyecare Holdings was inflated by HK$337.6 million in its 2003 annual report. The company, which listed in 1993, went into provisional liquidation in 2005, owing more than, in Hong Kong dollars, $5b
