Three years and four months' jail for ex-company director in HK$246m L/C fraud involving Guangnan
2003-12-2
A former director and deputy general manager of a subsidiary of publicly listed Guangnan (Holdings) Limited (Guangnan), charged by the ICAC, was today (Tuesday) sentenced to three years and four months' imprisonment at the Court of First Instance for a US $31.5 million (about HK$246 million) Letters of Credit (L/C) fraud based on bogus commercial transactions.
Wu Ke, 37, formerly employed by Join Wing Limited (Join Wing), today pleaded guilty to five counts of conspiracy to defraud.
Join Wing was a subsidiary of Guangnan, trading in commodities including soya bean and palm oil.
In sentencing, Mr Justice Pang Kin-kee said although the defendant was not the mastermind of the L/C scam, he nevertheless played a major role.
The judge also said the banks were subject to substantial financial risks as the defendant had wilfully submitted false documents to support the applications for credit facilities.
The judge added that the jail term was reduced to three years and four months from the starting point of five years, taking into account the defendant's guilty plea.
The case arose from an earlier corruption inquiry into a series of L/C scams involving Guangnan.
The court heard that between November 1997 and October 1998, Wu had conspired with other persons to defraud 12 banks by causing Guangnan to apply for and utilize credit facilities from the banks in the form of 12 L/Cs.
In order to support the L/C applications, they had submitted false documents to the banks, purportedly evidencing genuine underlying commercial transactions between Guangnan and five other companies.
Such bogus transactions concerned the resale of palm oil, soya bean oil, rotary compressors, air-conditioners, stainless steel and aluminium, and cold rolled stainless steel, which never took place.
The court heard that as a result of the fraudulent scheme, the banks released more than US$31.5 million (about HK$246 million) in total to the five benefiting companies under the L/Cs.
The prosecution was today represented by Senior Government Counsel Alex Lee, assisted by ICAC officer Miranda Cheung.
Wu Ke, 37, formerly employed by Join Wing Limited (Join Wing), today pleaded guilty to five counts of conspiracy to defraud.
Join Wing was a subsidiary of Guangnan, trading in commodities including soya bean and palm oil.
In sentencing, Mr Justice Pang Kin-kee said although the defendant was not the mastermind of the L/C scam, he nevertheless played a major role.
The judge also said the banks were subject to substantial financial risks as the defendant had wilfully submitted false documents to support the applications for credit facilities.
The judge added that the jail term was reduced to three years and four months from the starting point of five years, taking into account the defendant's guilty plea.
The case arose from an earlier corruption inquiry into a series of L/C scams involving Guangnan.
The court heard that between November 1997 and October 1998, Wu had conspired with other persons to defraud 12 banks by causing Guangnan to apply for and utilize credit facilities from the banks in the form of 12 L/Cs.
In order to support the L/C applications, they had submitted false documents to the banks, purportedly evidencing genuine underlying commercial transactions between Guangnan and five other companies.
Such bogus transactions concerned the resale of palm oil, soya bean oil, rotary compressors, air-conditioners, stainless steel and aluminium, and cold rolled stainless steel, which never took place.
The court heard that as a result of the fraudulent scheme, the banks released more than US$31.5 million (about HK$246 million) in total to the five benefiting companies under the L/Cs.
The prosecution was today represented by Senior Government Counsel Alex Lee, assisted by ICAC officer Miranda Cheung.