ICAC lays charges against five more people in Convoy case
- A stockbroker and four former senior executives of Convoy Global Holdings Limited were charged by the Independent Commission Against Corruption
- The charges were in relation to city's largest financial investigation in decades
Hong Kong’s anti-corruption agency has charged five more people as part of the city's largest financial investigation in decades.
Those charged by the Independent Commission Against Corruption (ICAC) on Monday include a stockbroker and four former senior executives of Convoy Global Holdings who are accused of conspiracy to defraud over the acquisition of a company and a bond offering worth a combined HK$138.6 million (US$17.8 million).
Former Convoy chief financial officer Christie Chan Lai-yee, 46, and former executive director Byron Tan Ye-kai, 51, were among those charged.
Another former Convoy executive director, Roy Cho Kwai-chee, who is alleged to be the mastermind of the fraud, was charged in May. He was granted bail of HK$700,000 (US$89,600) and barred from leaving Hong Kong.
Chan, Tan and Cho, 55, are accused of leading Convoy to spend HK$89 million (US$11.4 million) to acquire a company, True Surplus International, which was 55 per cent owned by Cho. The ICAC said Cho did not disclose that he was a substantial shareholder in Convoy at the time, as required by law.
Nor, it is alleged, did Cho disclose his shareholding in True Surplus, a British Virgin Islands-incorporated firm engaged in assets investment and consultancy.
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As such, the stock exchange and the other shareholders of Convoy – the largest independent financial adviser in Hong Kong, with more than 100,000 customers – did not know Cho could benefit from the acquisition.
The ICAC added another charge of conspiracy to defraud against Chan, alleging that she worked with Convoy former executive director Mark Mak Kwong-yiu, 44, former manager Wong Shuk-on, 40, and Gransing Securities general manager Lee Yick-ming, 48, to induce Convoy to pay HK$49.6 million (US$6.4 million) in commission for a placement of bonds.
The payment was made via Gransing to a company of which Mak was a director.
All five who were charged on Monday were bailed by the ICAC. They and Cho will appear at Eastern Magistrates’ Court on Wednesday.
The Securities and Futures Commission worked alongside the ICAC in December 2017 to raid offices and other premises related to Convoy. The raids led to the arrest of four people, including Chan and Mak. Convoy’s former chairman, Quincy Wong Lee-man, and vice-chairman, Rosetta Fong Sut-sam, were also arrested, but have not been charged.
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Convoy’s shares were suspended at the request of the company’s board in December 2017. The company has since appointed a new senior management team led by chairman Johnny Chen Chi-wang.
The new management filed several writs in late 2017 and early 2018 against Cho and other related parties involved in a complex network of companies for their role in Convoy's HK$4.043 billion (US$518 million) private placement in 2015.
In one of the writs, Convoy claims HK$715 million (US$91.6 million) in compensation from Cho and 12 others – nine people and three companies – for a series of transactions that had led to losses at Convoy Collateral.
Convoy said on Monday that the company would continue to support the enforcement agencies’ investigation and that Chan had been suspended from her duties.
Lee remains a general manager at Gransing Securities.
