China Apollo Holdings boss Lok Fai has told an insider dealing inquiry he cannot recall key documents and meetings relating to a profit forecast which was allegedly 'massaged' to come up to scratch.
The chairman of the listed health-drinks company appeared as a witness at the insider dealing tribunal yesterday but was unable to recall the details of letters and conversations relating to a proposed revision of the 1995 forecast.
A 'pall of suspicion' hangs over the company's 1995 year-end results, according to former tribunal chairman Mr Justice Michael Hartmann, as an exceptional item 'conveniently' turned a profit forecast into reality. It has been suggested by the judge that the profit forecast may have been 'massaged to a greater degree' than initially suspected.
As a result, the inquiry has widened to include 'potentially serious criminal allegations' including false accounting and conspiracy to defraud.
Two China Apollo executives are accused of insider dealing in the company's shares by exercising options two months before the company's 1995 results.
Executive director Zhang Tie-cheng and financial director and company secretary Raymond Lau Chan-wing are fighting the accusations at the tribunal.
