Fourteen months’ jail for $1.5m loans and commissions fraud
2019-5-17
A former direct sales representative of a bank, charged by the ICAC, was today (May 17) sentenced to 14 months’ imprisonment at the District Court for defrauding the bank of loans totalling about $1.5 million for seven applicants and commissions amounting to over $56,000 by fraudulent means.
Yip Kin-ming, 41, former direct sales representative of DBS Bank (Hong Kong) Limited (DBS Bank), earlier pleaded guilty to seven counts of fraud, contrary to Section 16A of the Theft Ordinance.
In sentencing, Judge Frankie Yiu Fun-che said the case was not a single incident but a premeditated fraud scam. The defendant proactively coached the loan applicants to lie to the bank. His acts constituted a serious breach of trust and undermined the image of financial institutions and the financial market in Hong Kong.
The judge said the offences committed by the defendant was serious in nature and warranted an immediate custodial sentence. He reduced the starting point of two years in jail to 14 months after taking into account the defendant’s guilty plea and his willingness to repay the commissions to the bank.
The case arose from a corruption complaint referred by DBS Bank. Subsequent ICAC enquiries revealed the above offences.
The court heard that at the material time, the defendant was a direct sales representative of DBS Bank, who was responsible for sourcing potential loan customers by operating street booths and distributing promotional items such as handbills.
DBS Bank prohibited its direct sales representatives from acquiring loan applicants by cold calls and handling referrals from financial intermediaries (FIs) as a measure to protect the interests of the bank and its customers.
Between July and December 2015, the defendant arranged seven persons referred from FIs, including Quinaray Development Company Limited (QDCL), to secure loans from DBS Bank. But he had never declared any conflict of interest to the bank for his connection with the FIs.
The court heard that the seven loan applicants confirmed that after receiving cold calls from FIs, they visited the offices of the FIs which undertook to assist in the loan applications with a service fee equivalent to 15% to 25% of the granted loan amount.
Eventually, each of the loan applicants secured a personal loan ranging from $120,000 to $350,000, totalling about $1.5 million, from DBS Bank. As a result, the bank released a total sum of over $56,000 to the defendant as commissions.
During the process, the defendant coached the loan applicants to lie to DBS Bank that they had approached the bank after the receipt of its handbills, or not to disclose that they were referred by the FIs, the court was told.
Ng Siu-lun, also known as Alan Ng, 32, former chief financial analysis manager of QDCL, was also charged by the ICAC with conspiracy to defraud DBS Bank by failing to disclose to the bank that another applicant was referred by QDCL for a loan application, thereby causing the bank to grant a loan of $107,000 to him.
Ng pleaded not guilty to the charge. The trial against him was heard. He had his case adjourned to May 28 for verdict.
DBS Bank had rendered full assistance to the ICAC during its investigation into the case.
The prosecution was today represented by prosecuting counsel Fu Chong-sang, assisted by ICAC officer Hayley Lau.
Yip Kin-ming, 41, former direct sales representative of DBS Bank (Hong Kong) Limited (DBS Bank), earlier pleaded guilty to seven counts of fraud, contrary to Section 16A of the Theft Ordinance.
In sentencing, Judge Frankie Yiu Fun-che said the case was not a single incident but a premeditated fraud scam. The defendant proactively coached the loan applicants to lie to the bank. His acts constituted a serious breach of trust and undermined the image of financial institutions and the financial market in Hong Kong.
The judge said the offences committed by the defendant was serious in nature and warranted an immediate custodial sentence. He reduced the starting point of two years in jail to 14 months after taking into account the defendant’s guilty plea and his willingness to repay the commissions to the bank.
The case arose from a corruption complaint referred by DBS Bank. Subsequent ICAC enquiries revealed the above offences.
The court heard that at the material time, the defendant was a direct sales representative of DBS Bank, who was responsible for sourcing potential loan customers by operating street booths and distributing promotional items such as handbills.
DBS Bank prohibited its direct sales representatives from acquiring loan applicants by cold calls and handling referrals from financial intermediaries (FIs) as a measure to protect the interests of the bank and its customers.
Between July and December 2015, the defendant arranged seven persons referred from FIs, including Quinaray Development Company Limited (QDCL), to secure loans from DBS Bank. But he had never declared any conflict of interest to the bank for his connection with the FIs.
The court heard that the seven loan applicants confirmed that after receiving cold calls from FIs, they visited the offices of the FIs which undertook to assist in the loan applications with a service fee equivalent to 15% to 25% of the granted loan amount.
Eventually, each of the loan applicants secured a personal loan ranging from $120,000 to $350,000, totalling about $1.5 million, from DBS Bank. As a result, the bank released a total sum of over $56,000 to the defendant as commissions.
During the process, the defendant coached the loan applicants to lie to DBS Bank that they had approached the bank after the receipt of its handbills, or not to disclose that they were referred by the FIs, the court was told.
Ng Siu-lun, also known as Alan Ng, 32, former chief financial analysis manager of QDCL, was also charged by the ICAC with conspiracy to defraud DBS Bank by failing to disclose to the bank that another applicant was referred by QDCL for a loan application, thereby causing the bank to grant a loan of $107,000 to him.
Ng pleaded not guilty to the charge. The trial against him was heard. He had his case adjourned to May 28 for verdict.
DBS Bank had rendered full assistance to the ICAC during its investigation into the case.
The prosecution was today represented by prosecuting counsel Fu Chong-sang, assisted by ICAC officer Hayley Lau.