Two company directors jailed for $22.6m credit fraud
2002-8-16
Two company directors were today (Friday) sent to jail after being found guilty of conspiracy to defraud four banks out of $22.6 million in Letters of Credit (L/C) loans using bogus transaction records.
Lam Chuen, 29, director of Wang Yip Materials and Engineering Limited (Wang Yip), was sentenced to four-and-a-half-years in jail for five counts of conspiracy offences.
Co-defendant, Ho Kam-wing, 43, director of Easywin Engineering Limited (Easywin), was sentenced to two years’ imprisonment for three conspiracy charges.
In sentencing, Deputy Judge Anthony Yuen said the defendants had abused the trust of the banks and put the banks at a substantial financial risk.
The court heard that the defendants had conspired with other persons to defraud Hongkong and Shanghai Banking Corporation Limited (HSBC), Bank of East Asia Limited (BEA), and Dah Sing Bank Limited (DSB) over 14 L/Cs applications for a total of $11.6 milli on between March 1999 and October 2000.
The defendants had submitted false documents to the banks purportedly evidencing Wang Yip had purchased construction materials from Easywin, causing the banks to release funds to Easywin.
The majority of the L/Cs proceeds were reverted by cheques signed by Ho from Easywin to Wang Yip.
Lam was also found to have conspired with other persons to use false documents, purportedly showing there had been genuine purchase of building materials from Wang Yip, to obtain L/C facilities for over $11 million from BEA and Hang Seng Bank Limited.
The case originated from a corruption complaint, alleging that a former manager of the Bank of East Asia had accepted bribes for granting credit facilities.
The former bank manager had been charged with accepting a $500,000 loan from a trading company’s director to increase credit facilities for that company. He was jailed for nine months in April this year.
The prosecution was today represented by Mr Duncan Percy on a fiat, assisted by ICAC officers Choi Shu-keung and Christina Yip.
Lam Chuen, 29, director of Wang Yip Materials and Engineering Limited (Wang Yip), was sentenced to four-and-a-half-years in jail for five counts of conspiracy offences.
Co-defendant, Ho Kam-wing, 43, director of Easywin Engineering Limited (Easywin), was sentenced to two years’ imprisonment for three conspiracy charges.
In sentencing, Deputy Judge Anthony Yuen said the defendants had abused the trust of the banks and put the banks at a substantial financial risk.
The court heard that the defendants had conspired with other persons to defraud Hongkong and Shanghai Banking Corporation Limited (HSBC), Bank of East Asia Limited (BEA), and Dah Sing Bank Limited (DSB) over 14 L/Cs applications for a total of $11.6 milli on between March 1999 and October 2000.
The defendants had submitted false documents to the banks purportedly evidencing Wang Yip had purchased construction materials from Easywin, causing the banks to release funds to Easywin.
The majority of the L/Cs proceeds were reverted by cheques signed by Ho from Easywin to Wang Yip.
Lam was also found to have conspired with other persons to use false documents, purportedly showing there had been genuine purchase of building materials from Wang Yip, to obtain L/C facilities for over $11 million from BEA and Hang Seng Bank Limited.
The case originated from a corruption complaint, alleging that a former manager of the Bank of East Asia had accepted bribes for granting credit facilities.
The former bank manager had been charged with accepting a $500,000 loan from a trading company’s director to increase credit facilities for that company. He was jailed for nine months in April this year.
The prosecution was today represented by Mr Duncan Percy on a fiat, assisted by ICAC officers Choi Shu-keung and Christina Yip.