Ethics case to weigh heavy on high-flying hospital chief
We understand there may be some movement soon in the longest outstanding disciplinary case of the Hong Kong Institute of Certified Public Accountants (HKICPA), featuring Hong Kong Hospital Authority chairman Anthony Wu Ting-yuk, the General Chamber of Commerce and the Bauhinia Foundation Research Centre.
As David Webb, the editor of Webb-site.com points out, the case has been running since December 2009. Others involved in the complaint include Ernst & Young, of which Wu was chairman until December 20005, and Catherine Yen Ka-shun, another senior figure at the human resources firm.
The complaint relates to the collapse of New China Hong Kong Group (NCHK), which was formed with considerable fanfare in 1993 by a consortium of investors from Hong Kong, the mainland (including the Hong Kong and Macau Affairs Office) and Singapore. The group was chaired by Tsui Tsin-tong and went from having net assets of HK$221 million in 1993 to net liabilities of HK$590 million in 1996, which increased to HK$764 million by 1997. Then it went spectacularly bust in 1999, going into voluntary liquidation. It had debts of around HK$62 million at the time of its liquidation, which then was one of Hong Kong's biggest corporate bankruptcies. Wu was financial adviser to the NCHK. At the same time he was managing partner of Ernst & Young's China business in 1996, before becoming deputy chairman of the firm in 1998 and being named chairman in 2000. During this period, Ernst & Young was auditor to NCHK.
A string of lawsuits followed the collapse of NCHK - one of which was against Ernst & Young and Wu, which was settled out of court. One of the issues that the HKCPI will be looking into during its current inquiries is possible conflict of interest on Wu's part since he sat on NCHK's executive committee while his firm was auditor. There is a lot riding on the outcome of these proceedings since Wu is regarded as a high-flyer and has been mentioned as a possible contender in the chief executive race.
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