Lily Chiang was on leave at time of alleged offences, court hears

PUBLISHED : Wednesday, 30 March, 2011, 12:00am
UPDATED : Wednesday, 30 March, 2011, 12:00am

High-profile businesswoman Lily Chiang Lai-lei was on sick and maternity leave after losing an unborn twin during the period of her alleged fraud offences, a court heard yesterday.

Former General Chamber of Commerce chairwoman Chiang, 50, is on trial in the District Court with two co-defendants on five charges of fraud and making false statements. Two of the charges are alternative.

Prosecutors alleged Chiang had instructed her employees to hold shares for her and concealed her beneficial interests from shareholders, the Securities and Futures Commission and the Hong Kong Stock Exchange. The alleged offences took place between January and December 2001, and between February and August 2002.

Around September 2001, Chiang found she was pregnant with twins, but she discovered the following month that one of them did not have a heartbeat, the court heard. Choking back tears, she said: 'The doctor told me to relax and not to get stressed as it could affect the survival of the other twin.'

She rarely worked from December 2001 to the end of her maternity leave in July 2002, apart from attending an investors' presentation for Eco-Tek - a company that she set up.

The prosecution alleged that after Kandy Profits took over Chiang's other company, Pacific Challenge, in August 2002, Chiang had instructed her assistant Yip Yuk-chun to collect cheques from the proceeds of surrendered shares that were held by Chiang's five employees.

Chiang, who is accused of putting HK$2,507,400 of proceeds into her safety deposit box at a bank on August 13, denied seeing Yip that day and denied receiving the money.

When the board of directors of Pacific Challenge, including Chiang, resigned on July 29, 2002, she no longer had the authority to instruct any of the company's employees to do work for her, the court heard.

She added that she never had the authority to instruct employees as to how to deal with their shares. Chiang said that she opened a safe deposit box on August 13, 2002, to keep jewellery that was given to her newborn girl. Her home had been burgled in the past, the court heard.

Asked whether the money was delivered to her maid at home, she said: 'No ... I have so many maids.' Her income from the end of 2001 to February 2002 was HK$1.05 million, the court heard. Yip, who testified earlier as an immune witness, once asked Chiang why she was not granted shares in Pacific Challenge, Chiang said. Chiang testified that she had already given shares in Eco-Tek to Yip. Also, Yip transferred to Pacific Challenge from Eco-Tek after shares were granted. The trial continues today before Judge Albert Wong Sung-hau.