CASES OF ALLEGED corruption seem to be uncovered on a daily basis as the economic downturn grinds on. Syndicates colluding at government auctions, a liquor licensing scam, horse-race rigging and police tipping off nightclub operators about raids in exchange for bribes and sex trips to Macau - these are among the allegations of illicit activity reported in just the past six weeks. The number of reports of corruption in Hong Kong is at its highest point since the Independent Commission Against Corruption was established in 1974, but the anti-graft body says the problem is not as bad as it may seem and the situation is under control. Its claims are borne out by independent surveys showing perceptions of the level of corruption remain quite low. However, survey organisers are warning the problem could spread because of the SAR's deepening links with the mainland, which is considered one of Asia's blackspots. 'Being a distinct yet integral part of China poses special challenges for Hong Kong in fighting corruption,' said the Political and Economic Research Consultancy in a report released last week. 'The problem in China is systemic. There are limitations to what the SAR can do to avoid becoming tangled up in the mess.' The consultancy's Asia-wide survey of expatriate executives showed Hong Kong was viewed as the third-least corrupt in the region this year with a score of 3.33 (out of a possible 10, with lower scores the better in terms of corruption) this year, following Singapore (0.9) and Japan (3.25). The SAR's score deteriorated from 2.8 in pre-handover 1995 to a high point of 4.06 in 1999. It has subsequently recovered some lost ground to 3.77 last year. Its second placing in the survey was lost to Japan last year. At the other end of the graft scale are Indonesia (9.92), India (9.17), Thailand (8.89), Vietnam (8.25), the Philippines (8) and mainland China (7). Another major survey rates Hong Kong highly in terms of the low degree of corruption as seen by business people, academics and risk analysts. Transparency International's corruption perception index ranks the SAR in 14th spot, up from 18 in 1997. When Hong Kong people in the mid-1990s considered what life would be like after the return to Chinese rule, one of their main concerns was revealed by surveys to be a rise in corruption. Those fears have largely remained unrealised, but the SAR appears in the eyes of some executives to have embarked on a slippery slope in 1999 when its score deteriorated to the worst point. Bob Broadfoot, managing director of the SAR-based Political and Economic Risk Consultancy, believes Hong Kong's rating suffered following the Sally Aw Sian scandal and amid controversy over the right-of-abode cases. 'There were a few cases where the integrity of the legal system was questioned,' he said. 'It doesn't take many exceptions to cause perceptions to deteriorate'. Secretary for Justice Elsie Leung Oi-sie declined to prosecute Ms Aw, proprietor of the Hong Kong Standard, in a circulation fraud case following an ICAC investigation. Chief Executive Tung Chee-hwa was a former director of Sing Tao, publisher of the now-defunct English-language newspaper. Ms Leung said there was not enough evidence to warrant prosecuting Ms Aw and that to do so could have harmed the public interest because of the impact on her company, an employer of many people. In the right-of-abode cases, the SAR Government sought a reinterpretation by Beijing's lawmaking body to overturn a ruling by the SAR's highest court allowing mainland children born to a Hong Kong permanent resident to enter the territory. The onset of the Asian financial crisis in 1997 also led to perceptions that corruption was worsening, said Mr Broadfoot. While the open nature of the economic systems of Hong Kong and Singapore made them more susceptible to corruption, it was well known that authorities did not tolerate graft. Pollster and University of Hong Kong academic Sonny Lo Shiu-hing said a survey with which he was involved found Hong Kong residents had been quite worried about the prospects for graft in the post-1997 era. But their concerns had subsequently dissipated, Professor Lo said. The Hong Kong Transition Project survey had found 31 per cent of respondents were very worried about corruption in late 1996. That figure then dropped to about 10 per cent during the past five years. Residents' fears had reflected speculation post-handover Hong Kong would become more like the mainland - civil liberties would be stifled and graft would rise, said Professor Lo. He believed corruption concerns had fallen because the media had focused on 'maladministration and poor leadership' in the SAR Government. 'Since the handover, the Hong Kong civil service has, by and large, been clean,' said Professor Lo. 'But having said that we don't know much about citizens' attitudes to the question of corruption in China.' More research was needed into the way residents viewed the prevalent use of 'personal connections' on the mainland in securing business deals and achieving personal goals, he said. As more Hong Kong people had contact across the border there was a threat that the use of personal connections could become more developed in the SAR. The Government's apparent decision to push ahead with pay cuts for civil servants of 4.75 per cent should be monitored by anti-corruption authorities, Professor Lo said. 'Whether this increases the temptation of civil servants to be corrupt remains to be seen.' The ICAC blames the economic downturn for pushing the corruption complaints it has received from the public to a high. 'Individuals and companies are more likely to notice improper dealings when it is difficult to make money,' said an ICAC spokesman. 'People are more vigilant now in harder times.' The commission received a total of 4,476 complaints last year, up two per cent from 2000 and compared with 3,189 when it was founded in the midst of widespread official corruption in the early 1970s. Private sector complaints rose six per cent last year to 2,542 (a big increase from 416 in 1974), and those involving government departments dropped from 1,732 in 2000 to 1,587 last year (down from 2,745 when the ICAC started operating). The spokesman sought to play down the prevalence of corruption in government, saying it had been 'gradually in decline' since its heyday in the 1960s and 1970s. No corrupt syndicates had been found operating in government departments, the ICAC spokesman said. 'We are finding it is individuals who are trying to make a quick buck.' Most complaints in the private sector related to building management practices and many were found to be the result of misunderstandings, he said. Commenting on the Political and Economic Risk Consultancy survey, the spokesman said: 'We take it as a good reference but perceptions may not particularly reflect the real situation.' email@example.com Glenn Schloss is a staff writer for the Post's News Desk 'Improper dealings are more likely to be noticed when it is difficult to make money'