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Six More Former Exchange Officials Charged in Bribery Probe

August 10, 1988

HONG KONG (AP) _ The government today charged six former officials of the Hong Kong Stock Exchange with violating anti-bribery laws in a widening corruption probe that has shaken up the exchange’s leadership.

The Independent Commission Against Corruption also said in a statement that additional charges were filed against former exchange chairman Ronald Li Fook- shiu and Jeffrey Sun Hon-kuen, the former chief executive.

Each of the eight defendants faces seven years in jail and a $64,100 fine if convicted.

Four defendants face three counts each of accepting preferential allotments of shares in connection with the flotation, or listing of new shares of stock, of three companies on the exchange, the commission said.

The statement identified the four as Charles Sin Cho-chiu, 52, who succeeded Li as chairman last year; former exchange vice chairmen Kenneth Wong Kai-ming, 57; Cham Siu-leun, 66; and John Chong Lap-hong, 53.

The companies named by the agency were Videotechnology International Ltd., Q.P.L. Ltd., and Hysan Development Co. Ltd.

Two other new defendants - former exchange vice chairman Joseph Ma Ching- chung, 51, and former exchange governing committee member Edward Woo Pak- hay, 50 - are each charged with two similar counts in connection with Q.P.L. and Hysan, the commission statement said.

Li was charged in January with accepting a special allotment of shares from the Kumagai Gumi Ltd. construction company in exchange for approving the firm’s listing on the stock exchange.

The agency today also charged Li with accepting preferential allotments of shares in connection with the flotation of Cathay Pacific Airways Ltd., Videotech, Q.P.L. and Hysan, and with accepting sub-underwriting commissions related to Cathay Pacific, the statement said.

Sun, already facing charges in connection with Videotech and Q.P.L., was charged with an additional count concerning the Hysan stock flotation, the statement said.

A spokeswoman for the commission said no other details of the charges would be released until the defendents appear in court Thursday. All eight men have been released on bail.

David Gledhill, Hong Kong chairman of Cathay Pacific’s parent company, refused comment on the charges.

He said in a statement that ″neither Cathay Pacific nor the Swire Group (parent company), nor any of their management were aware until the ... investigation that there was any suggestion that Ronald Li had allegedly obtained an advantage out of the flotation of Cathay Pacific.″

A woman who answered the telephone at Li’s office said he was not in.

A Videotech spokesman said the company was unaware of details of the charges but had cooperated with the investigation. Q.P.L and Hysan said officials were unavailable for comment.

Soon after Li’s arrest in December, the exchange reshuffled its leadership in a move prompted by a government request that seven members of its general committee be suspended from management until the investigation ended.

The seven members included Li and all those charged today except Chong.

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