Chairman and executive director of listed company guilty of fraud over bogus accounting records
2004-9-1
The chairman and an executive director of publicly listed Global Trend Intelligent Technologies Limited (Global Trend), charged by the ICAC for their roles in a fraudulent scam to use false business and accounting records for auditing purpose, were today (Wednesday) convicted at District Court.
Xu Peixin, 41, and Cai Yajuan, 47, respectively chairman and executive director of Global Trend, were found guilty of one joint charge of conspiracy to use false instruments.
Judge Barnes adjourned the case until 2:30 pm tomorrow (Thursday) for sentence, and remanded the defendants in the custody of the Correctional Services Department.
The case arose from a corruption complaint in relation to the listing of the company. Subsequent ICAC inquiries revealed the defendants' roles in the fraudulent scam.
The court heard that in late 2002, Ernst & Young, auditor of Global Trend, was asked to prepare a Report of the Auditors for inclusion in the 2002 Annual Report of Global Trend.
Between December 2002 and April 2003, Xu and Cai conspired together and with their staff to use documents purporting to be accounting and business records of Global Trend, which they knew were false, for submission to Ernst & Young for auditing.
The court heard that based on the bogus documents, Ernst & Young presented in its Report of the Auditors that the turnover and the net profit attributable to shareholders of Global Trend in the financial year of 2002 amounted to more than $212 million and over $43 million respectively.
The prosecution was today represented by Wong Po-wing on a fiat, assisted by ICAC officer Brenda Wong.
Xu Peixin, 41, and Cai Yajuan, 47, respectively chairman and executive director of Global Trend, were found guilty of one joint charge of conspiracy to use false instruments.
Judge Barnes adjourned the case until 2:30 pm tomorrow (Thursday) for sentence, and remanded the defendants in the custody of the Correctional Services Department.
The case arose from a corruption complaint in relation to the listing of the company. Subsequent ICAC inquiries revealed the defendants' roles in the fraudulent scam.
The court heard that in late 2002, Ernst & Young, auditor of Global Trend, was asked to prepare a Report of the Auditors for inclusion in the 2002 Annual Report of Global Trend.
Between December 2002 and April 2003, Xu and Cai conspired together and with their staff to use documents purporting to be accounting and business records of Global Trend, which they knew were false, for submission to Ernst & Young for auditing.
The court heard that based on the bogus documents, Ernst & Young presented in its Report of the Auditors that the turnover and the net profit attributable to shareholders of Global Trend in the financial year of 2002 amounted to more than $212 million and over $43 million respectively.
The prosecution was today represented by Wong Po-wing on a fiat, assisted by ICAC officer Brenda Wong.