Charges in $680m fraud saga dropped

Justice chiefs have dropped fraud charges against businessman Lee Ming Tee to end a contentious and costly legal battle that has spanned more than a decade.

After fighting prosecutors at every turn, the Malaysian tycoon has pleaded guilty to two charges of publishing a false statement or account and is to be sentenced today.

The decision to drop the most potent charges - relating to a $680 million fraud against Allied Group shareholders on the part of then-chairman Lee - took legal experts and legislators by surprise, with some lawmakers urging an explanation from the Department of Justice.

Lee, 64, pleaded guilty yesterday in the Court of First Instance to two charges of publishing a false statement or account under the Theft Ordinance, which carry a maximum sentence of 10 years each. He will be sentenced today before Mr Justice Michael Burrell. But Lee denied two similar charges and another two counts of conspiracy to defraud involving the multimillion-dollar payment on the issuing of new shares between 1990 and 1992.

It was alleged Lee conspired with Ronald Tse Chu-fai, the former finance director and financial controller of Allied Group, and others to defraud the group's shareholders and creditors, the Securities and Futures Commission and the Hong Kong stock exchange.

Barrister Ian Lloyd, for the Department of Justice, said due to a 'matter agreed between parties', the prosecution agreed not to pursue the four charges.