At long last we see there is movement in the longest outstanding disciplinary case of the Hong Kong Institute of Certified Public Accountants, featuring Hong Kong Hospital Authority chairman Anthony Wu Ting-yuk. The case has been outstanding since December 2009, but the institute will hold its first hearing into the case tomorrow. The events that triggered the complaint to the institute go back even further, to the 1990s. Some readers may recall the collapse of New China Hong Kong Group (NCHK), which was founded in 1993 by a consortium of investors from Hong Kong, the mainland (including the Hong Kong and Macau Affairs Office) and Singapore. The group was chaired by Tsui Tsin-tong and went from having net assets of HK$221 million in 1993 to net liabilities of HK$764 million by 1997. It somehow remained alive for two more years before going into voluntary liquidation amid claims from creditors exceeding HK$100 million. Wu was financial adviser to NCHK. At the same time, he was managing partner of Ernst & Young's China business in 1996, before becoming deputy chairman of the firm in 1998 and chairman in 2000. During this period, Ernst & Young was auditor to NCHK. Various lawsuits followed NCHK's collapse, one of which was against Ernst & Young and Wu, which was settled out of court.
One of the central issues that the institute will examine in its disciplinary hearings tomorrow is a possible conflict of interest on Wu's part since he sat on NCHK's executive committee while his firm was auditor.
Others involved in the complaint include Ernst & Young, of which Wu was chairman until December 2005, and Catherine Yen Ka-shun, another senior figure at the accounting firm. The disciplinary proceedings have been unusual in the large volume of documents, the number of letters asking for more time, and the number of lawyers involved in the proceedings. Indeed, there have been complaints from the disciplinary committee investigating the case over its slow progress. Wu recently stepped down as chairman of the Bauhinia Foundation, and earlier this year did not seek re-election as the chairman of the Hong Kong General Chamber of Commerce.
There is a lot at stake for Wu in the outcome of these hearings. Wu was regarded as a high-flyer but this case has been hanging over him for some years and has exercised some restraint on his political progress.
Nomura pays derisory fine
Nomura Holdings has been fined after it was discovered that its employees were giving tips on clients' share sales - a form of insider dealing. The fine was all of 200 million yen (HK$19.46 million), which according to Bloomberg is the highest penalty ever imposed by the Tokyo Stock Exchange. Together with fines from other exchanges in Japan, Nomura has been fined a total of 324 million yen. Nomura must be thanking its lucky stars that it wasn't caught doing this in the US. Once US regulatory authorities sink their teeth in there is some real pain. A few months ago, Standard Chartered was fined US$340 million to settle money laundering charges. JP Morgan agreed to pay US$20 million, earlier this year, over a case involving the alleged mishandling of customer accounts. It was fined US$53 million by British authorities in 2010 for a similar charge. Citigroup last year paid US$570 million in fines and charges relating to subprime mortgage charges.
Sandy stirs up CCTV storm
Netizens in the mainland have been puzzling over the extensive coverage CCTV has been giving to Hurricane Sandy in the US. The coverage has been so heavy, they say, that you would have thought Sandy was hitting Beijing rather than New York, the website Offbeat China reports. Some questioned why CCTV had so much coverage of "a disaster in a remote country as if there isn't anything important to cover domestically". Another wrote: "The Ningbo protest is known all around the world and yet CCTV turned a blind eye to it."
There was no shortage of suggested reasons for the coverage. They included: "CCTV had too big a budget this year", "reporting a disaster in the US is much safer than reporting certain domestic news", and "the news is for government officials because their wives (second wives, too) and kids are all in the US".
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