Police arrest fifth person in HKMEx scandal

Woman was held at the border while Cheung has resigned from posts at Rusal and AIA

PUBLISHED : Monday, 27 May, 2013, 12:00am
UPDATED : Thursday, 07 May, 2015, 3:28pm

Police have arrested a fifth person in its probe into the collapse of Barry Cheung Chun-yuen's Hong Kong Mercantile Exchange (HKMEx).

The latest development came as Cheung resigned from his positions in major businesses - as a board member of Russian aluminium producer United Co Rusal and as an independent non-executive director of AIA Group Limited.

A police spokesman said last night a 35-year-old woman, surnamed Zheng, had been arrested on suspicion of using a false instrument.

It is understood Zheng is from the mainland and was detained trying to cross the border from Hong Kong into the mainland.

A search of HKMEx's board of directors and management team found no one by that surname.

Police charged three men last week with possessing false instruments with intent. They are Dai Linyi, 65; Li Shanrong, 49; and Lian Chunyan, 50.

A 60-year-old man, surnamed Zhu, was arrested last Wednesday on suspicion of possessing false documents.

He was released on bail two days later but has to report back to police in mid-July.

Cheung has meanwhile resigned from the United Co Rusal board, three sources familiar with the situation revealed.

They said Cheung decided to resign from all his public duties to minimise the possible effect the probe could have on public institutions, including Rusal.

A Rusal spokeswoman declined to comment.

Separately, the AIA Group's board of directors on Saturday issued a statement announcing that Cheung had tendered his resignation as independent non-executive director effective from that day to "attend to other commitments".

He had also ceased to be a member of the Audit Committee, Remuneration Committee and Nomination Committee of the board with effect from last Saturday, the statement said.

In a related development, the financial problems facing the failed HKMEx were already known a year ago, a colleague of Cheung's revealed.

"A year ago, when it wasn't yet a matter of much concern, it was perceived as, 'Oh, it's in bad business; it's cash-strapped'," said Executive Council member Cheung Chi-kong on a TVB talk show yesterday.

The blanket resignations of Barry Cheung - known as Chief Executive Leung Chun-ying's top aide - were "a firewall" for the government, Cheung Chi-kong said. "To put it colloquially, the one who commits the act bears its responsibility," he said.

But Cheung Chi-kong said HKMEx's financial problems had not been a "big issue" a year ago.

"Many companies, when faced with cash-flow problems, could issue debentures, look for new shareholder injections [or] expand the capital stock. All the options were there. That's why we were not particularly concerned," he said.