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SCMP Reporter

A 48-YEAR-OLD director who falsified records by $604 million in an attempt to save his company was sentenced to 21/2 years' jail in the High Court yesterday.

  Lee Pui-lam had pleaded guilty to one count of false accounting in what Mr Justice Ryan described as a ''very sad case''. He said Lee was now professionally and financially ruined.

  The court heard Lee had been trying to buy time in hope the group would recover. There was no question of him taking money out of the company for his own use.

   The court also heard he had put his life savings into the business.

   Lee had qualified as an accountant, starting his own accounting firm and then set up P. L. Hong Group which traded in raw plastic.

  The group prospered because of Lee's hard work and direction and his family lived relatively humbly. The judge noted that the results of Lee's company would have entitled him to a more lavish lifestyle.

  However, in 1989, the group fell into financial difficulties because of trading factors beyond his control. If the true story got out, Lee realised the banks would withdraw their credit and the business would collapse.

  The accounts did show a loss, but much smaller than that which had actually occurred, Mr Justice Ryan said.

  But in the end, the financial situation did not improve and the group collapsed in 1991, going into liquidation.

  Given there was no evidence to the contrary, the judge took the view that the banks were not in a worse position in 1991 than they would have been if the company had folded in 1989.

  Other mitigating factors were Lee's plea which had saved three months of court time, his remorse and the fact he had been waiting two years for trial.

  But the judge said its was a serious offence to falsify accounts so that banks, creditors and shareholders were misled into believing the position was better than it was.

  ''If this sort of behaviour were to go insufficiently punished there would be a serious impact on the public's confidence in the operation of the business world,'' the judge said.

  He took a starting point of five years.

  Earlier, Abdul Hoosen, for Lee, said his client was a man of previous good character who had found himself under extreme pressure and had lost his usual good judgment.

  Lee and his wife had judgment debts of $80 million against them which they could not pay.

     and bankruptcy proceedings would probably be brought next.



Director gets 21/2 years' jail for $604m falsified records