Hong Kong developer and 11 villagers jailed for deceiving government in rural housing scam
Judge imposes longest sentence, three years, on elderly developer who masterminded deception in which residents sold their land rights
A developer and 11 indigenous villagers were jailed for up to three years on Friday for a scam in which they sold their land rights under the small house policy for profit.
Judge Sham Siu-man said the government relied on villagers' integrity and honesty to operate the scheme, but this case showed the policy was "unfeasible".
Developer David Li Yam-pui, 82, approached indigenous villagers to buy their small house rights, then used their names to deceive the Lands Department and build houses on his own land.
"The indigenous villagers in this case have no intention to follow the government's policy to authorise their own rights. They only want to use their right to make money," Shum said.
He found this an unhealthy trend that should not be encouraged and so passed a deterrent sentence, jailing Li for three years.
The two oldest villagers, Cheng Hing, 80, and Wan Kai-lun, 72, each received prison terms of two and a half years, while the rest were jailed for two years and 10 months.
The government introduced a small house policy in 1972, allowing male indigenous villagers who had a right to claim village land in the New Territories to build a three-storey home as a residence.
The District Court heard the scam took place between 2008 and 2011. Li, who owned farmland in Sha Tin, used a middleman to approach 22 villagers and bought their small house rights for a total of HK$4.3 million. During the applications, the villagers committed perjury by making false representations.
Defence lawyer Philip Wong argued that the government, upon the request of the Heung Yee Kuk rural group, had amended the small house licence application form in 2007. Since then villagers applying for a small house licence were no longer required to issue a sworn declaration they had not entered into a secret deal with a developer.
Wong said Chief Secretary Carrie Lam Cheng Yuet-ngor, who was then development minister, wrote to Lau Wong-fat, then chairman of the kuk, to confirm the change. Wong said that under this change if a villager was in breach of terms, the government would only retrieve his land, but not press criminal charges.
But the judge said the intention was never to legitimise the selling of small house rights.
"The government has never allowed indigenous villagers to sell their small house rights. The villagers also know very well the government's standing."
He found the kuk had not been seeking a way to allow villagers to sell their rights.
"This system is built on trust," the judge said. But he felt the system could not work in the New Territories.
Wong said all the defendants would appeal.
Yuen Long rural leader Leung Fuk-yuen said kuk members would discuss small house rights with lawyers and talk to the government to see how to better protect their rights.
The Lands Department said the verdict was a reminder that selling small house rights was against the government's policy and offenders would likely face criminal consequences.
The Development Bureau agreed there was room to review the small house policy.
