The explosive growth of Carrian pushed its stock price up more than tenfold over the space of just one year. Many ordinary people were attracted and became minor shareholders in the Group.
Following the collapse of the Group, a press report quoted a stockbroker, who on behalf a wealthy merchant had speculated in Carrian shares, as saying: “Carrian shares were talked up as shares, the share price of which would only rise and would never fall. The wealthy client initially held between 200,000 and 300,000 shares of the Group and in 1982, when the share price dropped, he purchased a few million more thinking it would be wise to purchase more at a lower price. Who could have predicted that the share price would plunge and that trading would finally be suspended! In the wink of the eye the massive investment had gone into smoke!”
Mr Lam, another victim, still felt aggrieved when recalling the incident.”Carrian succeeded in creating a smoke screen to convince the public that it was a financially robust company. Many people unreservedly invested in its shares. Who could have known that the shares in no time could become worthless.”The incident cost him confidence in the stock market and he shunned from investing in stocks for a long time afterwards.
Mr Wu, whose father was a stockbroker, said, “I was young and not interested in speculation at that time. But because of my father, I knew something about the Carrian case. The whole case was a swindle. According to my father, even people inside the trade could not see through their tricks or figure out how they managed to keep all the others in the dark. Numerous people fell victim but they could blame it on bad luck and see it an expensive lesson.”
Mr Ho, a fund manager, said, “I started to work in the stock market just before the collapse of Carrian. I was lucky to have escaped an touch. When Carrian suspended trading, everybody was aghast! Many had lost their life-long savings yet there was nothing they could do except to sigh in anguish. The Carrian share certificates were used as wallpaper.”
The Carrian minority shareholders were not the only victims in this case. Hong Kong taxpayers also had to foot the cost and the image of Hong Kong was tarnished.
The judge pointed out in his judgment that the illegal acts of this small group of defendants had seriously tarnished the hard-earned reputation of Hong Kong as a financial and commercial hub.
According to information provided by the court, prosecution costs amounted to HK$210 million, all paid from the public purse and that the ICAC’s expenditure alone exceeded HK$28 million. However, many voices in society considered it worthwhile to spend as much as was required to uphold justice. The then Hong Kong Attorney General also indicated that Hong Kong would not tolerate commercial fraud and that it was essential for law-enforcement agencies to spare no effort in the fight against crime and to commit all possible resources into investigations and prosecutions. Justice should not be given a price tag.
“No matter how rich one is, no matter how shrewd the team of defence lawyers are, and no matter how well one knows how to abuse the legal process to play for time, one will eventually face sanction by the court for breaching the laws of Hong Kong. The effort and money spent over these 13 years serve to bring out this point.”
Ming Pao Editorial (21.9.1996)
“This has been a case in which defendants systematically sought to manipulate the legal process for their own ends. They failed because the Government was determined to see that the offenders were brought to justice, regardless of cost. That was the correct decision, no matter who ultimately pays the bill.”
South China Morning Post (24.9.1996)