Mainland-funded company director and merchant charged for alleged $14m L/C fraud
2001-12-12
A Mainland-funded company director and a merchant were today (Wednesday) charged by the ICAC for their alleged involvement in a $14 million Letters of Credit (L/C) fraud, and brought to Kowloon City Court this afternoon.
Cheng Man-to, also known as Zheng Wentao, 45, director and shareholder of Oriental Hero Industries Limited (OHIL), and Chan Chin, 52, sole proprietor of Post Metal Works (PMW), faced one count of conspiracy to defraud.
No pleas were taken. Magistrate Ms Merinda Chow adjourned the case until January 3, 2002, pending transfer to District Court.
The case originated from a corruption complaint, alleging that Cheng and Chan had bribed bank officers for their assistance to obtain L/Cs through dishonest means. ICAC enquiries did not reveal any involvement of bank staff.
Cheng and Chan were alleged to have conspired with other persons to defraud the Nanyang Commercial Bank and the National Commercial Bank by dishonestly:
- causing OHIL to apply for and utilise about $14 million in credit facilities from the banks in the form of L/Cs;
- submitting false documents to the banks purportedly evidencing genuine underlying commercial transactions between
OHIL and PMW;
- procuring the issue by the banks of the L/Cs in favour of PMW; and
- causing the banks to release about $14 million to PMW under the L/Cs.
The alleged bogus transactions concerned the sale and purchase of about 3,000 metric tons of steel sheets.
The alleged offence took place between April 1, 1997 and October 31, 1998.
Cheng and Chan were granted cash bail of $200,000 and $100,000 respectively and $100,000 cash surety each.
The prosecution was today represented by ICAC officer Anthony Chun.
Cheng Man-to, also known as Zheng Wentao, 45, director and shareholder of Oriental Hero Industries Limited (OHIL), and Chan Chin, 52, sole proprietor of Post Metal Works (PMW), faced one count of conspiracy to defraud.
No pleas were taken. Magistrate Ms Merinda Chow adjourned the case until January 3, 2002, pending transfer to District Court.
The case originated from a corruption complaint, alleging that Cheng and Chan had bribed bank officers for their assistance to obtain L/Cs through dishonest means. ICAC enquiries did not reveal any involvement of bank staff.
Cheng and Chan were alleged to have conspired with other persons to defraud the Nanyang Commercial Bank and the National Commercial Bank by dishonestly:
- causing OHIL to apply for and utilise about $14 million in credit facilities from the banks in the form of L/Cs;
- submitting false documents to the banks purportedly evidencing genuine underlying commercial transactions between
OHIL and PMW;
- procuring the issue by the banks of the L/Cs in favour of PMW; and
- causing the banks to release about $14 million to PMW under the L/Cs.
The alleged bogus transactions concerned the sale and purchase of about 3,000 metric tons of steel sheets.
The alleged offence took place between April 1, 1997 and October 31, 1998.
Cheng and Chan were granted cash bail of $200,000 and $100,000 respectively and $100,000 cash surety each.
The prosecution was today represented by ICAC officer Anthony Chun.