A public doctor was accused of embezzling more than HK$2.2 million in housing allowances by claiming rent on a flat he owned and asking another doctor to say he was the owner.
A doctor testifying under immunity said it was common practice in the 1990s for civil servants to ask their fellows to become a 'nominal owner' of their flats so they could claim benefits under the Private Tenancy Allowance.
Yuen Kai-tak, 47, allegedly received HK$2.2 million in tenancy allowance. The prosecution said the flat was only worth HK$1.5 million.
Yuen (pictured), on trial in District Court, pleaded not guilty to five corruption charges for deceiving Tuen Mun Hospital by claiming allowances for the flat at Evergreen Villa, Yuen Long, between 1990 and 1998.
'This was an elaborate plan by a government officer who took advantage of his employment benefits and embezzled over HK$2.2 million over a period of more than 10 years,' prosecutor Giles Surman said. 'He did so by renting his own property to himself.'
Surman said Yuen bought the property and asked a close friend, public doctor Tang Siu-kin, to pretend to be the owner. Yuen had paid the mortgage repayments, rates and all other expenses and lived at the property since the purchase.
Surman said the Civil Service Regulation stated that a leased property for which a civil servant claimed tenancy allowance could not be owned by himself or by his relatives.
Tang, who was giving evidence under immunity, said that on June 11, 1990, Yuen told him over the phone that he had signed a provisional sale and purchase agreement for the flat on Tang's behalf.
Tang said he had never visited the flat and he was not the real owner.
He said that before the purchase he had talked to Yuen about how his colleagues bought property for each other so they could claim tenancy allowance as if they were only tenants. Tang said: 'It was a common and prevailing practice.'
The court heard that Tang took out a mortgage of about HK$1.5 million for the flat on Yuen's instructions and used what Yuen called 'rent' to repay the loan.
The maximum penalty for each offence is seven years' jail and a fine of HK$500,000. The trial continues tomorrow.