Hong Kong has a scarce supply of land for its population. This shortage of land naturally means, however, that land prices are high, and that people often have to lavish their lifetime's savings on buying an apartment. If a hard earned apartment turned out to be substandard, the owner would be devastated. Jerry-building for quick profit could turn people's dreams of owning a safe, comfortable home into a life threatening nightmare.

In 1997, Hong Kong embarked on a massive public works programme. Although Hong Kong's economy had been impacted by the Asian financial turmoil that began in October 1997, public housing construction remained intensive from 1998 on. A series of scams related to substandard works, including short piling, soon surfaced, however. In three years from 1998 to 2000, the ICAC initiated 142 prosecutions in cases of corruption and fraud involving substandard construction works.

  Major corruption and fraud cases involving substandard construction works

(Arranged in the order in which the ICAC operations were publicized.)

1 Airport Railway Hong Kong Station Works The ICAC commenced investigations upon receiving a report of suspected corruption in early 1998. 13 persons were arrested in July 1998. May - November 1997 This incident involved corruption connected with the construction of short piles. Eighty-three out of the 87 piles constructed were shorter than the prescribed length by 1 m to 15 m. Twelve persons were charged. Eight of them, including a commercial diver, were sentenced to jail terms ranging from 12 to 44 months.
2 Tung Chung Area 30 Shopping Arcade site Phase 4 The ICAC conducted an investigation in early 1999 after receiving a report from HD. Ten persons were arrested in January 1999. December 1998 - January 1999 Four persons were charged with deceiving HD by accepting advantages, falsifying pile lengths, swapping steel bar samples for testing, falsifying test reports and concealing the non-compliant piling foundations of a shopping arcade and a car park. Three persons were acquitted and one was jailed for eight months.
3 Tung Chung Station Development Project Stage 2 Site No. 4 The ICAC conducted an investigation upon receiving a report from a consultancy company. Eight persons were arrested in October 1999. July 1997 - May 1998 The site engineer had accepted advantages from the contractor, including free trips and entertainment at nightclubs, in an elaborate conspiracy to deceive. Seventy-two out of 76 piles were found to be short. Three persons were sentenced to imprisonment, ranging from 6 to 21 months. On appeal, the site engineer's sentence was increased to 45 months.
4 Central and Wanchai Pumping Station and Screening Plants The ICAC conducted an investigation upon receiving a report from HD. Six persons were arrested in November 1999. May 1997 - January 1998 An employee of a subcontractor and its company director were sentenced to terms of imprisonment ranging from 27 to 48 months.
5 Yuen Chau Kok HOS Site Upon receiving a complaint from HD in December 1998, the ICAC conducted an investigation and arrested eight persons in January 2000. April - December 1998 A settlement monitoring survey discovered severe short piling in the foundation works. Two HOS buildings that had already reached well above 30 floors and had to be demolished. One site agent was jailed for 42 months and two company directors were jailed for 12 years (later reduced by two years on appeal.)
6 Yuen Long Industrial Estate The first short piling scam discovered on a private development site. The ICAC conducted an investigation after receiving a complaint. Three persons were charged in May 2000. February - September 1998 Having been found guilty of offering and accepting bribes, having conspired to use H-piles instead of bored piles, and having failed to drill piles down into the bedrock, a director and an engineer of the main contractor were jailed for 60 months and 48 months respectively.
7 Tung Chung Area 30 Phase III HOS Site The ICAC conducted an investigation upon receiving a corruption report. Six persons were arrested in May 2000. January - May 1999 An engineer and an engineering manager used unqualified steel bars to defraud HD. They were sentenced to jail for 21 months and 42 months respectively.
8 Tung Chung Area 30 Phases 1 and 3 sites The ICAC carried out an investigation upon receiving a corruption report. Three persons were charged in July 2000. September 1997 - July 1998 In this case, 34 out of 84 piles failed to meet the prescribed length. It was shown that the engineering staff used a rigged measuring tape to assist them in providing HD with false records of pile lengths. One person was sentenced to jail for 21 months.
9 Tin Shui Wai Tin Chung Court HOS project HD referred the case to ICAC in 1999 after discovering the short piles. ICAC arrested 20 persons in February 2001. September 1996 - October 1997 HD discovered short piles after observing unusual settlement at the site after it had proved very difficult to install lift shafts. Two persons were sentenced to jail for 58 months. The necessary remedial works carried out by HA cost some $250 million, thus tripling piling costs.



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