Four people were yesterday sentenced to nine months each in prison for fraud in applying for seven initial public offerings that netted them a total of about HK$270,000 in 2006.
The four, who pleaded guilty earlier this month in the city's first listing fraud case, used false identity card numbers and addresses in making multiple applications for lucrative flotations in violation of the one-application-per-person rule.
'This is a serious financial crime,' said Deputy Judge Eddie Yip Chor-man while delivering the sentence. 'Their actions have broken the rule that one investor should only apply once in an initial public offering.
'Their actions have affected the chances for other investors to subscribe the new shares and have hurt the integrity of the Hong Kong investment market.'
The judge said the jail sentences were necessary because the scheme was a 'well-planned' plot that was 'unfair to other investors'.
Sentenced for the crime were insurance agent Weyman Au Wai-ming, 35; his girlfriend, private tutor Chan Wai-yee, 34; Au's mother, Lin Shun-kuen, 58; and Cheung Lai-kin, 26, the girlfriend of Au's brother. Earlier this month, they pleaded guilty to seven charges of conspiracy to defraud by taking advantage of a gap in the application process that enabled them to file up to 20 applications per person in each of the seven flotations from October to December 2006.
The share offers included the world's largest, the US$22 billion launch by Industrial and Commercial Bank of China. The others were Kingboard Laminates Holdings, Zhaojin Mining Industry, China Communications Services Corp, Shanghai Jin Jiang International Hotels (Group), China Communications Construction and China Coal Energy.