A former MassMutual Asia executive has admitted in court to giving his subordinate a copy of a forged letter, which spread rumours that US insurance rival American International Assurance (AIA) was in trouble. The forged letter was later passed to four other people, including two MassMutual clients and an AIA insurance agent. Chen Han-siang, 46, pleaded guilty yesterday before acting Principal Magistrate Bina Chainrai in Eastern Court to one count of using a copy of a false instrument. The forged letter, purportedly issued by AIA's customer services department, advised customers to apply to surrender their insurance policies before September 26, otherwise they might not receive a refund of the principal and bonus of their policies, the court heard. The incident took place on September 23 - as news emerged that AIA's parent company, AIG, was mired in financial trouble. The letter sparked chaos at the time and AIA issued a statement that it was totally fraudulent and had no basis in fact. No details were revealed in court yesterday about the letter's origins. Chen, then deputy general branch manager of MassMutual Asia, was well aware of the fraudulent content by the time he gave the letter to his subordinate, Sin Kin-tong, the prosecutor said. That morning, Wong Hoi-pang, director of MassMutual agency office, expressly told his senior management subordinates in a meeting, including Chen, that the content was false. After the meeting, Chen handed a copy to Mr Sin and said AIA was 'in great trouble'. Believing Chen, Mr Sin immediately made photocopies and faxed them to two clients, To Hon-chi and Chan Kai-cheong, the court heard. He also faxed a copy to his wife, Lau Po-yan, who was also a MassMutual insurance agent. Ms Lau then passed a copy to an AIA insurance agent for confirmation. The letter eventually reached the vice-president and general counsel of the law department of AIA Company (Bermuda), who confirmed their company had not issued it. Chen had told Mr Sin later on the day of the alleged offence that the content was false and reminded him not to mention it to anyone, the prosecutor said. But the reminder came too late as it had already been faxed to the two clients, the court heard. Chen asked Sin to discard all copies only on September 25, two days after they had been passed around. In mitigation, lawyer Iu Ting-pong said Chen was deeply remorseful and had learnt a great lesson. He has been unemployed since he was sacked in November, and has lost his HK$1 million bonus and his clients. Chen's wrongdoing was confined to giving a copy of the letter to Mr Sin without warning him of the false content right away; he had not asked Mr Sin to pass it around, Mr Iu said. Mr Iu also noted that Chen had told Mr Sin about the false content only an hour after giving him the copy. The lawyer asked the magistrate to take into account Chen had made no personal gain in the offence. Ms Chainrai adjourned Chen's sentencing to May 4, pending background and community service order reports.