CY Leung UGL payment saga
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Leung Chun-ying made the HK$50 million deal after UGL’s 2011 purchase of DTZ. Photo: David Wong

Hong Kong prosecutors ‘still not decided’ whether to charge CY Leung over HK$50 million UGL deal

Department of Justice dismisses report that it has wrapped up probe into former city leader’s deal, which he did not declare to his cabinet

The Department of Justice said on Sunday it had not decided whether to prosecute former Hong Kong leader Leung Chun-ying over the undeclared HK$50 million he received from an Australian firm around the time he took office, saying reports that it had dropped the case were inaccurate.

That came as a lawmaker who initially called for the probe said he would be “astonished and disappointed” if the reports were true.

Leung’s failure to declare his deal with engineering firm UGL sparked controversy when it came to light in 2014. The Independent Commission Against Corruption (ICAC) and the Legislative Council investigated the deal for possible conflicts of interest.

At dispute this week was a TVB news report which quoted sources suggesting government lawyers decided not to prosecute Leung after advice from a senior barrister in the UK, which it had hired.

But a DoJ spokesman said on Sunday: “The Department of Justice has not decided on whether to institute any prosecution in that case ... As the case is not over yet, the department would not reveal any detail of it.”

The ICAC investigated the deal for possible conflicts of interest. Photo: Felix Wong

Leung struck the lucrative deal following UGL’s 2011 purchase of DTZ, a property services company once listed in the UK, of which he was a director. As part of the bargain, he agreed not to form or join a rival firm and to help promote the company. He received part of the HK$50 million after becoming chief executive in 2012.

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But he did not declare any of the fee to his cabinet, the Executive Council.

Leung is now vice-chairman of the Chinese People’s Political Consultative Conference, the country’s top advisory body.

The TVB report said the QC who the department consulted was of the view that Leung had not done anything inappropriate or corrupt in his role as chief executive during the effective term of the deal, and suggested further legal action was unnecessary.

The UGL deal caused a lot of controversy for Leung Chun-ying. Photo: Sam Tsang

It said the ICAC’s Operations Review Committee had already noted the development and that the graft-buster would close the file on the case based on the department’s decision.

A spokesman for the ICAC said it would not comment on any individual case or media reports.

TVB’s assistant general manager Tam Sik-yeung said on Sunday he would not comment on the department’s statement and the reporting of the company’s news division. The broadcaster reaffirmed its earlier report in its news show at noon.

The Legco panel that was investigating the UGL saga in November criticised Leung for being “uncooperative”, for merely providing legislators with information about the payment that was already public, such as Legco meeting minutes and earlier statements he issued through a law firm, and snubbing their invitations to hearings.

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Democratic Party legislator Lam Cheuk-ting, who originally reported Leung’s case to the ICAC, said he had not heard anything from the graft-buster about ending the probe.

“[The ICAC] must inform the complainants once it decides to wrap up a case after securing approval from the Department of Justice and the Operations Review Committee,” Lam, a former ICAC investigator, said, citing the watchdog’s protocol.

He said he would be “astonished and disappointed” should the DoJ decide not to prosecute Leung.

“If a chief executive faces no prosecution ... even when he received a sum of tens of millions of dollars from a private corporation during his term without any declaration, then Hong Kong’s integrity system is set to face a huge challenge,” he said.

During a visit to Britain last year, Lam reported Leung’s case to the UK’s International Corruption Unit. He said on Sunday he was still in touch with the agency, which had yet to inform him whether it would pursue the investigation against Leung.

Chief Secretary Matthew Cheung Kin-chung said he would not comment on the reports.

This article appeared in the South China Morning Post print edition as: Leung not out of the woods over UGL payments