Merchant charged with conspiracy to defraud over ‘backdoor listing’ and money laundering wanted by ICAC
2022-10-25
A District Court judge today (October 25) issued a warrant for the arrest of a merchant, who was earlier charged by the ICAC with a then chairman and a then substantial shareholder of a listed company and another person with conspiracy to defraud by concealing a “backdoor listing” agreement and dealing with crime proceeds of $42 million.
Ma Zhonghong, 49, merchant, who was charged in November 2021, faced two counts of conspiracy to defraud, contrary to Common Law; and one count of dealing with property known or reasonably believed to represent proceeds of an indictable offence, contrary to Section 25(1) of the Organized and Serious Crimes Ordinance.
Ma failed to report to the Police in early October and did not turn up at the District Court this morning for mention. Judge Mr Kwok Wai-kin issued a warrant for the arrest of Ma upon an application made by the prosecution.
Co-defendants are Chim Pui-chung, 76, then substantial shareholder of Asia Resources Holdings Limited (Asia Resources); Ricky Chim Kim-lun, 53, then chairman of Asia Resources; and Wong Poe-lai, 65. Chim Pui-chung and Ricky Chim also faced the two counts of conspiracy defraud mentioned above, while Wong also faced the aforesaid count of dealing with property known or reasonably believed to represent proceeds of an indictable offence. Their case was set for trial at the District Court on May 2, 2024.
At the material time, Asia Resources was listed on the Main Board of the The Stock Exchange of Hong Kong Limited (SEHK). After Chim Pui-chung became a substantial shareholder of Asia Resources in October 2008, Ricky Chim was appointed as an executive director of the company. Between December 19, 2008 and December 11, 2014, Ricky Chim was the chairman of the board of directors of Asia Resources. Wong was an employee of a company of Ma.
It is alleged that between July 1, 2013 and November 15, 2015, Chim Pui-chung, Ricky Chim and Ma conspired together and with other persons to defraud Asia Resources, its board of directors and shareholders by dishonestly:
(i) concealing or failing to disclose that Ma had reached an agreement with Chim Pui-chung and Ricky Chim that Ma would pay a total sum of about $210 million to Chim Pui-chung in order to control 70 per cent to 75 per cent of the entire issued share capital of Asia Resources (the Illicit Agreement);
(ii) causing the board of directors of Asia Resources to approve, and causing Asia Resources to proceed with the placing of its new shares and the placing of convertible notes of which the conversion shares, upon full exercise of the conversion rights, represented approximately 566.67 per cent of the then existing issued share capital of the company (the CN Agreement) with a view to increase the entire issued share capital of the company thereby facilitating the execution of the Illicit Agreement;
(iii) falsely representing in the announcements and circulars of Asia Resources that no director or shareholder of the company had a material interest in the CN Agreement and no shareholder of the company was required to abstain from voting at the special general meeting of the company for the approval of the CN Agreement (the SGM);
(iv) causing the shareholders of Asia Resources to pass the resolution in relation to the CN Agreement at the SGM.
Between July 1, 2013 and November 15, 2015, Chim Pui-chung, Ricky Chim and Ma had allegedly conspired together and with other persons to defraud the SEHK by dishonestly:
(i) concealing or failing to disclose that Chim Pui-chung, Ricky Chim and Ma had reached the Illicit Agreement;
(ii) concealing or failing to disclose the purpose of the CN Agreement was to increase the entire issued share capital of Asia Resources thereby facilitating the execution of the Illicit Agreement;
(iii) falsely representing in the announcements and circulars of Asia Resources that no director or shareholder of the company had a material interest in the CN Agreement and no shareholder of the company was required to abstain from voting at the SGM;
(iv) causing the SEHK not to take prompt action to seek clarification with Asia Resources on the CN Agreement, and/or causing the SEHK to approve the publication by the company of the announcements and circulars in relation to the CN Agreement.
It is also alleged that between October 24, 2013 and January 24, 2014, Wong and Ma, knowing or having reasonable grounds to believe that convertible notes issued by Asia Resources in the principal amount of $42 million, in whole or in part, directly or indirectly represented the proceeds of indictable offence, dealt with the said property.
The prosecution was today represented by Senior Public Prosecutor Ivan Shiu, assisted by ICAC officers Henry Lung and Matthew Tong.
Ma Zhonghong, 49, merchant, who was charged in November 2021, faced two counts of conspiracy to defraud, contrary to Common Law; and one count of dealing with property known or reasonably believed to represent proceeds of an indictable offence, contrary to Section 25(1) of the Organized and Serious Crimes Ordinance.
Ma failed to report to the Police in early October and did not turn up at the District Court this morning for mention. Judge Mr Kwok Wai-kin issued a warrant for the arrest of Ma upon an application made by the prosecution.
Co-defendants are Chim Pui-chung, 76, then substantial shareholder of Asia Resources Holdings Limited (Asia Resources); Ricky Chim Kim-lun, 53, then chairman of Asia Resources; and Wong Poe-lai, 65. Chim Pui-chung and Ricky Chim also faced the two counts of conspiracy defraud mentioned above, while Wong also faced the aforesaid count of dealing with property known or reasonably believed to represent proceeds of an indictable offence. Their case was set for trial at the District Court on May 2, 2024.
At the material time, Asia Resources was listed on the Main Board of the The Stock Exchange of Hong Kong Limited (SEHK). After Chim Pui-chung became a substantial shareholder of Asia Resources in October 2008, Ricky Chim was appointed as an executive director of the company. Between December 19, 2008 and December 11, 2014, Ricky Chim was the chairman of the board of directors of Asia Resources. Wong was an employee of a company of Ma.
It is alleged that between July 1, 2013 and November 15, 2015, Chim Pui-chung, Ricky Chim and Ma conspired together and with other persons to defraud Asia Resources, its board of directors and shareholders by dishonestly:
(i) concealing or failing to disclose that Ma had reached an agreement with Chim Pui-chung and Ricky Chim that Ma would pay a total sum of about $210 million to Chim Pui-chung in order to control 70 per cent to 75 per cent of the entire issued share capital of Asia Resources (the Illicit Agreement);
(ii) causing the board of directors of Asia Resources to approve, and causing Asia Resources to proceed with the placing of its new shares and the placing of convertible notes of which the conversion shares, upon full exercise of the conversion rights, represented approximately 566.67 per cent of the then existing issued share capital of the company (the CN Agreement) with a view to increase the entire issued share capital of the company thereby facilitating the execution of the Illicit Agreement;
(iii) falsely representing in the announcements and circulars of Asia Resources that no director or shareholder of the company had a material interest in the CN Agreement and no shareholder of the company was required to abstain from voting at the special general meeting of the company for the approval of the CN Agreement (the SGM);
(iv) causing the shareholders of Asia Resources to pass the resolution in relation to the CN Agreement at the SGM.
Between July 1, 2013 and November 15, 2015, Chim Pui-chung, Ricky Chim and Ma had allegedly conspired together and with other persons to defraud the SEHK by dishonestly:
(i) concealing or failing to disclose that Chim Pui-chung, Ricky Chim and Ma had reached the Illicit Agreement;
(ii) concealing or failing to disclose the purpose of the CN Agreement was to increase the entire issued share capital of Asia Resources thereby facilitating the execution of the Illicit Agreement;
(iii) falsely representing in the announcements and circulars of Asia Resources that no director or shareholder of the company had a material interest in the CN Agreement and no shareholder of the company was required to abstain from voting at the SGM;
(iv) causing the SEHK not to take prompt action to seek clarification with Asia Resources on the CN Agreement, and/or causing the SEHK to approve the publication by the company of the announcements and circulars in relation to the CN Agreement.
It is also alleged that between October 24, 2013 and January 24, 2014, Wong and Ma, knowing or having reasonable grounds to believe that convertible notes issued by Asia Resources in the principal amount of $42 million, in whole or in part, directly or indirectly represented the proceeds of indictable offence, dealt with the said property.
The prosecution was today represented by Senior Public Prosecutor Ivan Shiu, assisted by ICAC officers Henry Lung and Matthew Tong.