• Sat
  • Dec 20, 2014
  • Updated: 8:56am
Column
PUBLISHED : Saturday, 22 March, 2014, 1:22am
UPDATED : Saturday, 22 March, 2014, 1:22am

Big Lau's Macau land fiasco is the movie that never got made

For Chinese Estates tycoon Joseph Lau, the ultimate insult in the Macau corruption case is that he was 'cheated' out of a lucrative business deal

Joseph Lau Luen-hung will not be going to jail in Macau even though he has been convicted there of bribery on a massive scale. Yet to describe him as "very sad and very upset", as his lawyer did, is probably a gross understatement.

Money Matters recalls a chat with Lau years ago. He was then complaining about a woman who came to him asking for a loan, offering to pay an interest rate lower than what she had proposed to another person whom he described as "my disciple".

"I almost had to stab my thigh with a knife to stop myself from throwing a chair at her," Lau said. "How dare she offer me a lower rate!"

To be treated or seen as a fool is probably the worst insult, if not a crime, in the eyes of Lau, whose transformation from electric fan manufacturer to tycoon relied on his wits and guts.

The Macau land fiasco is one such insult.

To be treated or seen as a fool is probably the worst insult, if not a crime, in the eyes of Lau

In early 2005, businessman Steven Lo Kit-sing informed Lau of Macau's plan to sell five plots of prime land near its airport. They decided to get the land by offering Macau's then secretary for transport and public works, Ao Man-lung, a HK$20 million bribe, according to last week's Macau court judgment.

On the eve of the land tender, Lo set up a company, Moon Ocean, to submit the bid.

Lau and his listed arm Chinese Estates had no holding in Moon Ocean. Instead, a Chinese Estates subsidiary provided Lo's company with a HK$250 million loan to pay the deposit for the bid. In return, Lau got an option agreement to buy a 70.01 per cent shareholding in Lo's company.

"Tycoons never want to get their hands dirty," said a professional who has worked for tycoons conducting business in Macau.

"A handful of trusted subordinates take care of the dirty work," he said.

"The structure allows the tycoon to take over if everything goes smoothly, while claiming no formal ties with anything."

That was exactly what happened in January 2006, when Chinese Estates bought Moon Ocean from Lo for about HK$200 million after Ao got paid and the HK$1.3 billion land sale was signed.

However, Ao's arrest in December 2006 and his subsequent imprisonment just over a year later for taking bribes threw every land deal in Macau into a deep freeze.

With the uncovering of Ao's "directory of friends", in which he listed names as well as bribes promised and put a tick against those who had paid, the buzz was about which tycoons would go down with Ao.

All eyes were on the controversial land sale to Chinese Estates because Ao said he had opted for tender by invitation to make sure the land went to a developer with international reputation. Yet Lo, with zero expertise, got it in the end.

After four years of suspense, the whole thing took a surprising turn in March 2011. Chinese Estates not only managed to secure approval for the land's development but also a 37 per cent expansion in its gross floor area.

Chinese Estates took over the remaining 30 per cent of Lo's company for HK$1.6 billion and sped ahead with its luxury apartment project.

In the early 2012 pre-sale, Chinese Estates sold a third of the apartments, bringing in HK$3.8 billion in sales and HK$357 million in profit.

But it was too early to celebrate. In April 2012, Ao was brought to court again for taking bribes from Lau. A month later, Lau and Lo were charged with bribery and money laundering.

Within weeks, the Macau government declared the land sale invalid.

Lau put up a vigorous fight for the land. In September, as the hearing of his bribery charge was coming to an end, Lau met some journalists and complained that he was charged because someone wanted the land.

In the meeting, which was filmed and made its way onto YouTube, Lau said he wanted to make a movie in which a guy named Big Lau (which happens to be Lau's nickname) was charged in May.

"In June, someone told Big Lau: 'If you agree to sell the land, I can guarantee you walk away free.' Big Lau was very angry and refused ... We are talking about [a profit of] $50 billion to $60 billion here," he said in the YouTube video.

The land was valued at HK$8.5 billion in 2011, five times the estimate in 2006, according to an independent appraisal commissioned by Chinese Estates.

Lau did not name anyone but said he would be very keen to show the movie to state leaders.

Of course, the movie was never made and Chinese Estates' legal battle over the land continues.

In the meantime, the court found Lau guilty, even though no meeting between him and Ao could be proven and the well-designed deal structure showed no direct link to him.

There was, however, a tick next to Lau's name in Ao's "directory of friends" and no mention of Lo in it, the court said.

So in the end, his wits and guts have failed him. How is he going to swallow it?

shirley.yam@scmp.com

Share

For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive
 
 

 

4

This article is now closed to comments

ann.wei.121
Macau is Mainland, you are corrupt because your God father is no longer in power. No direct link ? maybe some secret exchange of documents are not exposed to us, surely the court would not have convicted solely on a small tick in Ao's diary, how about the movement of money ? The cheque to Ao ? Do not forget the case was brought to light by the Hong Kong Administration.
norodnik
The movie that never was made is the story of Tung Chee Hua's father....gun running to the KMT and the Communists as well as uniforms, medicine, and foodstuffs. And how do you explain the torching of the Queen Mary moored in Victoria Harbour with entire elite of the HK colonial government on board...and then miraculously 30 years later his son winds up the first CE of Hong Kong....now that's a story to be told on the silver screen....
anthonygmail
So are we supposed to feel sorry for him?
goncalo
Sure we are. I've already shed a little tear myself and am on the way to buy a packet of tissues.
 
 
 
 
 

Login

SCMP.com Account

or