Garment company director charged as graft probe reveals US$5.5m L/C fraud and money laundering
2021-8-10
The ICAC today (August 10) charged a director of a garment manufacturing company with deceiving a bank into issuing Letters of Credit (L/Cs) worth totalling over US$5.5 million to a supplier based on fraudulent business transactions, and laundering the crime proceeds.
The ICAC investigation arose from a corruption complaint. Upon completion of the investigation, the ICAC sought legal advice from the Department of Justice, which advised laying four charges against the defendant.
Li Mau-yam, 59, director-cum-shareholder of Mau Wing Industrial Limited (Mau Wing), faces four charges – one of conspiracy to defraud, contrary to Common Law; and three of dealing with property known or believed to represent proceeds of an indictable offence, contrary to Section 25(1) of the Organised and Serious Crimes Ordinance.
The defendant has been released on ICAC bail, pending his appearance in the Eastern Magistrates’ Courts this afternoon for the case to be transferred to the District Court for plea.
At the material time, the defendant was one of the two directors-cum-shareholders of Mau Wing, a garment manufacturing company. Mau Wing purchased raw materials from suppliers and settled relevant transaction payments through L/Cs obtained from banks.
The defendant was also the sole proprietor of another company which solely owned Great Pacific Clothing Company Limited (Great Pacific Clothing).
One of the charges alleges that between July 28 and October 10, 2018, the defendant conspired together with an employee of Mau Wing and the sole proprietor of a supplier to defraud Bank of China (Hong Kong) Limited (BOCHK) by dishonestly applying to the bank for the issue of three L/Cs in favour of the supplier, knowing that there was no genuine underlying commercial transaction for those L/Cs, and producing false documentation, including invoices and cargo receipts, to support the three L/Cs applications, causing BOCHK to make payment totalling over US$5.5 million to the supplier.
Three other charges allege that between August 22 and October 10, 2018, the defendant dealt with three sums of money totalling over US$5.5 million held in a bank account of Great Pacific Clothing, knowing or having reasonable grounds to believe that the sums in whole or in part directly or indirectly represented proceeds of an indictable offence.
It is alleged that the three L/C payments totalling over US$5.5 million were deposited by the aforesaid supplier into the bank account of Great Pacific Clothing. The same was subsequently transferred to bank accounts of Mau Wing.
BOCHK has rendered full assistance to the ICAC during its investigation into the case.
The ICAC investigation arose from a corruption complaint. Upon completion of the investigation, the ICAC sought legal advice from the Department of Justice, which advised laying four charges against the defendant.
Li Mau-yam, 59, director-cum-shareholder of Mau Wing Industrial Limited (Mau Wing), faces four charges – one of conspiracy to defraud, contrary to Common Law; and three of dealing with property known or believed to represent proceeds of an indictable offence, contrary to Section 25(1) of the Organised and Serious Crimes Ordinance.
The defendant has been released on ICAC bail, pending his appearance in the Eastern Magistrates’ Courts this afternoon for the case to be transferred to the District Court for plea.
At the material time, the defendant was one of the two directors-cum-shareholders of Mau Wing, a garment manufacturing company. Mau Wing purchased raw materials from suppliers and settled relevant transaction payments through L/Cs obtained from banks.
The defendant was also the sole proprietor of another company which solely owned Great Pacific Clothing Company Limited (Great Pacific Clothing).
One of the charges alleges that between July 28 and October 10, 2018, the defendant conspired together with an employee of Mau Wing and the sole proprietor of a supplier to defraud Bank of China (Hong Kong) Limited (BOCHK) by dishonestly applying to the bank for the issue of three L/Cs in favour of the supplier, knowing that there was no genuine underlying commercial transaction for those L/Cs, and producing false documentation, including invoices and cargo receipts, to support the three L/Cs applications, causing BOCHK to make payment totalling over US$5.5 million to the supplier.
Three other charges allege that between August 22 and October 10, 2018, the defendant dealt with three sums of money totalling over US$5.5 million held in a bank account of Great Pacific Clothing, knowing or having reasonable grounds to believe that the sums in whole or in part directly or indirectly represented proceeds of an indictable offence.
It is alleged that the three L/C payments totalling over US$5.5 million were deposited by the aforesaid supplier into the bank account of Great Pacific Clothing. The same was subsequently transferred to bank accounts of Mau Wing.
BOCHK has rendered full assistance to the ICAC during its investigation into the case.