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SCMP Reporter

Former Ocean Grand Holdings  chairman Michael Yip Kim-po  was acquitted  of a string of fraud charges yesterday, with jurors rejecting allegations that he had engineered a massive accounting fraud at the company. 
The Court of First Instance jurors deliberated for four hours before they dismissed the government's case against Yip in  7-1 majority verdicts. 
Yip, the ex-husband of actress Gigi Fu Ming-hin,  was cleared on nine fraud charges in all, including conspiracy to defraud investors. 
Co-defendant Kwok Chi-ngai  was unanimously acquitted on a charge of conspiracy to falsify accounts. 
Prosecutors alleged that Yip and Mr Kwok, a former Ocean Grand sales manager, falsely inflated company sales through a bogus invoice scheme between 2002 and 2006. 
The trial  was told that the pair funnelled hundreds of orders through a web of Ocean Grand subsidiaries and outside companies. 
The director of one of those companies was a man nicknamed Tarzan, who appeared to be Yip's bodyguard, a witness testified. 
Prosecutors had alleged that the defendants faked a delivery to one of the companies as Ocean Grand's accountants investigated the transactions.
About 40 witnesses, including forensic accountants and Ocean Grand directors, testified at the trial.
Wong Man-kit  SC, Yip's barrister, said outside the court yesterday that the outside companies had not been used to hide bogus transactions but had processed renminbi-denominated orders from Ocean Grand's mainland customers. 
An accounting expert called by the defence suggested the foreign-exchange explanation near the end of the trial. 
The Commercial Crime Bureau rejected that argument yesterday.
'The defence merely raised a possibility of this dual role as a foreign-exchange agent,' an investigator from the unit said after the hearing. 'They had never tendered any concrete documents or solid evidence to support their claim. They only presented it to the jury as a possibility.'
During the trial, Mr Wong had portrayed Yip as a big-picture manager who left financial details to his underlings. 
The defence argued that Ocean Grand's audit committee and its outside accountants signed off on company financial statements while the alleged fraud was going on. 
Neither Yip nor Mr Kwok testified. 
After the verdict yesterday, Deputy High Court Judge Colin Mackintosh  granted Yip's request that the government pay his legal costs for the five-week trial. 
Prosecutor Peter Duncan  SC, who opposed the request, argued that Yip had never told police or company liquidators that the outside companies were used as foreign-exchange agents. 
'If that explanation had been given to investigators ... who knows where this investigation would have ended up?' he told the judge. 
Mr Justice Mackintosh ruled that Yip had no legal obligation to explain the transactions to investigators or the accountants who were winding up Ocean Grand.
Mr Kwok's request to have his legal costs paid was denied. The sales manager brought suspicion on himself by telling conflicting stories to explain why he had signed off on transactions at the centre of the fraud allegations, Mr Justice Mackintosh ruled. 
The jurors would be excused from trial duty if they were called again during the next decade, Mr Justice Mackintosh said, citing the trial's length and complexity. 
Yip was immediately remanded in custody on separate fraud charges connected to business dealings at  the collapsed aluminium-products company. 
Yip and four others, including his sister Yip Wan-fung,  are scheduled to stand trial on those charges in the  District Court in July.



Former Ocean  Grand chairman  cleared of fraud