Lily Chiang jailed 31/2 years for share, options fraud

PUBLISHED : Thursday, 16 June, 2011, 12:00am
UPDATED : Thursday, 16 June, 2011, 12:00am


High-profile businesswoman Lily Chiang Lai-lei was jailed for three- and- a-half years yesterday for her leading role in a HK$3 million share fraud that a judge said had shaken confidence in Hong Kong's financial system.

Describing Chiang as a member of a 'renowned family', District Court Judge Albert Wong Sung-hau gave her a 30 per cent discount on her sentence for reasons including her previous contribution to society and the fact that she had four children, aged two to 11.

Chiang's sister, Ann Chiang Lai-wan, a vice-chairwoman of the Democratic Alliance for the Betterment and Progress of Hong Kong, said the family was heartbroken.

The daughter of industrialist Chiang Chen and the first woman to chair the General Chamber of Commerce, Chiang showed no emotion as she heard the sentence.

She said earlier she would appeal, but family members said they had not decided whether to appeal and would consult lawyers first.

Wong said the dishonest actions of the businesswoman and her two co-accused had tarnished Hong Kong's image as a financial centre of integrity and had shaken investors' confidence in the financial system. Earlier, he had described Chiang as an 'author of dishonesty'.

Chiang, 50, had been found guilty of fraud, conspiracy to defraud and authorising a prospectus that included an untrue statement. Tahir Hussain Shah, 45, was jailed for two years for conspiracy to defraud. Pau Kwok-ping, 54, was jailed for 19 months for fraud and issuing a prospectus that included an untrue statement.

The court heard earlier that Chiang had designed a scam in which others held options or shares in two listed companies on her behalf. The options were said to have been rewards for senior officers at Chiang's companies but the recipients were low-ranking staff, including Chiang's driver and personal assistant.

Ann Chiang said: 'There are ups and downs in life. Lily faced many difficulties in the past 10 years. We believe that she will stay strong during the times of adversity.'

Lily Chiang's husband, Gino Yu, an associate professor at Hong Kong Polytechnic University, hoped his family would be reunited soon.

'My wife is now in prison. And we will all learn to adjust to this new reality,' he said. 'I am confident that Lily, myself and our children will grow from this experience.'

'We are a family full of love, trust, support and understanding,' he said. 'We all eagerly await the day that we are once again reunited as a family.'

Ann Chiang would not comment on the possibility of an appeal.

'We will talk to our lawyers,' she said.

In sentencing, Judge Wong ruled out community service or a suspended prison sentence, saying the alternatives would not reflect the gravity of Chiang's crime.

'This kind of offence is so serious in nature and degree that an immediate custodial sentence is the only appropriate sentencing option,' the judge said. 'The dishonest act of the defendants not only affects financial interests of [others], more importantly it shakes investors' confidence in the system.'

The judge gave a 15 per cent reduction to Chiang for her contribution to society, 10 per cent for the six years elapsed between the crime in 2001 and Chiang's arrest in 2007 and 5 per cent out of consideration of the effect on her family.

Shah and Pau received 20 per cent reductions in their sentences.

Chiang's father was absent from the packed courtroom because of business commitments.