Trio arrested for alleged bribery scam involving former state-owned enterprise's senior staff
2001-2-20
Two directors of a finance company were arrested by the ICAC for allegedly bribing a former chairman and a former deputy general manager of a state-owned enterprise in Hong Kong to secure $30 million compensation, which was ten times more than the due amo unt, after the failure of a business deal.
During the operation, cash totalling $9.8 million, US$879,000 and a large quantity of valuables, suspected to be part of the corrupt proceeds, were seized.
Some of the property seized was found at the home premises of the former deputy general manager allegedly involved in the case.
The rest were found in several suitcases entrusted to a third party by the former deputy general manager.
An employee of a trading company was also arrested in the ICAC operation code-named "Octopus", which commenced last week, for his alleged role in handling illegal proceeds.
The ICAC investigation arose from a corruption complaint.
Enquiries revealed that in April 1999, the two former senior staff of the state-owned enterprise, on behalf of the enterprise, entered into an agreement with the directors of the finance company to sell part of its stake in a Mainland bank for $160 millio n.
The finance company subsequently paid a deposit of $60 million.
According to the agreement, in the event that the deal could not be completed, the state-owned enterprise would return the deposit with accrued interests.
The state-owned enterprise later failed to perform the contract and subsequently returned the $60 million deposit to the finance company.
While the accrued interest payable was calculated as $2.56 million, the former deputy general manager allegedly instructed accounting staff to release compensation totalling $30 million, based on a dubious agreement between the two companies with altered compensation clauses.
The state-owned enterprise has rendered co-operation to the Commission.
The two former senior staff of the state-owned enterprise could not be located in Hong Kong.
Meanwhile, the three arrestees have been released on ICAC bail. Enquiries are continuing.
During the operation, cash totalling $9.8 million, US$879,000 and a large quantity of valuables, suspected to be part of the corrupt proceeds, were seized.
Some of the property seized was found at the home premises of the former deputy general manager allegedly involved in the case.
The rest were found in several suitcases entrusted to a third party by the former deputy general manager.
An employee of a trading company was also arrested in the ICAC operation code-named "Octopus", which commenced last week, for his alleged role in handling illegal proceeds.
The ICAC investigation arose from a corruption complaint.
Enquiries revealed that in April 1999, the two former senior staff of the state-owned enterprise, on behalf of the enterprise, entered into an agreement with the directors of the finance company to sell part of its stake in a Mainland bank for $160 millio n.
The finance company subsequently paid a deposit of $60 million.
According to the agreement, in the event that the deal could not be completed, the state-owned enterprise would return the deposit with accrued interests.
The state-owned enterprise later failed to perform the contract and subsequently returned the $60 million deposit to the finance company.
While the accrued interest payable was calculated as $2.56 million, the former deputy general manager allegedly instructed accounting staff to release compensation totalling $30 million, based on a dubious agreement between the two companies with altered compensation clauses.
The state-owned enterprise has rendered co-operation to the Commission.
The two former senior staff of the state-owned enterprise could not be located in Hong Kong.
Meanwhile, the three arrestees have been released on ICAC bail. Enquiries are continuing.