On 25 October 1978, the British property manager of the Hong Kong Telephone Company (Telephone Company) slipped quietly out of Hong Kong with his wife and flew back home to Britain, a mere three days after one of his subordinates was arrested by the ICAC on charges of having accepted bribes.
The escape unveiled a long and meticulous investigation of a complex web of corruption that led up to his eventual extradition to Hong Kong to face 18 corruption related charges.
The ICAC was set up against a backdrop of rampant corruption in 1974, when the Anti-Corruption Branch of the then Royal Hong Kong Police was disbanded.
At first, many people were openly sceptical that this new agency could prove effective in rooting out endemic corruption. Its creation was seen as primarily a cosmetic move and few people expected that it would ever tackle corruption at more than a superficial level.
While the first few years had brought considerable success, the ICAC had initially dealt with corruption only in the Hong Kong civil service. This gave rise to the view that the ICAC was not likely to extend its investigative activities beyond the Government gate.
To make matters worse, on 5 November 1977, the Government announced a partial amnesty. This further rocked public confidence in the Government’s determination to fight against corruption.
But, even as the amnesty was being declared, ICAC investigators were starting work on the Telephone Company case, a landmark endeavour that would help put paid to these mistaken views.
Set up on 24 June 1925, the Telephone Company was a scheduled public body. Its franchise gave it the sole right to supply and operate telephone services in Hong Kong.
As a public body, its staff were defined as public servants and were governed by the Prevention of Bribery Ordinance, as explained here.
Hong Kong’s economy took off dramatically in the 60s and 70s. The demand for telephone services surged and the number of telephone lines, telephone exchange buildings and staff all increased rapidly.
| 1965 | 1978 | Increase | |
| No. of telephone lines | 202,485 | 803,144 | 297% |
| No. of telephone exchange buildings | 27 | 52 | 93% |
| No. of staff | 3,639 | 7,262 | 100% |
The supply of telephone services fell far short of demand and getting a telephone line was no easy task. Tales of corruption involving Telephone Company staff were rife, and many people simply accepted that they had to pay the euphemistically named “tea money” if they wanted to shorten the wait for their line to be installed.
As a matter of fact, a senior staff member of the Telephone Company had been investigated by the Police Anti-corruption Branch for suspected corruption as early as 1964. He was never prosecuted, however, since he resigned and left Hong Kong.
Looking back, it may not seem too surprising that the company should provide the fertile soil where corruption on an extended scale could take root and flourish.