Ex- de­vel­op­ment chief and pal get 8 months for fraud

China Daily (Hong Kong) - - FRONT PAGE - By KAHON CHAN in Hong Kong kahon@chi­nadai­lyhk.com

For­mer de­vel­op­ment sec­re­tary, Mak Chai- kwong, and as­sis­tant high­ways di­rec­tor Tsang King-man re­ceived eight- month sus­pended prison sen­tences on Thurs­day for a hous­ing fraud that dated back to the 1980s.

They also re­ceived a six-month sen­tence for the charge of act­ing as an agent us­ing a doc­u­ment with in­tent to de­ceive his prin­ci­pal. Both sen­tences were con­cur­rent and sus­pended for two years.

Pass­ing sen­tence, Judge Johnny Chan Jong- herng said a cus­to­dial sen­tence should nor­mally be im­posed due to the in­volve­ment of pub­lic funds, but “jus­tice is best served by a sus­pended term of im­pris­on­ment”.

Mak and Tsang, ac­quainted since col­lege, had each pur­chased an apart­ment in City Gar­dens on the same day in 1986. They later ap­plied for pri­vate te­nancy al­lowances (PTA) from the govern­ment.

Govern­ment records showed they had cross-leased the flats to each other, but trans­ac­tion records from the early 1990s showed they had pock­eted pro­ceed­ings earned from the sales of the flats they had lived in.

They were hence con­sid­ered as the ef­fec­tive own­ers of the flats in which they had ap­plied for PTAs, rather than ten­ants, as their em­ployer was told. But the lid only blew off sev­eral days af­ter Mak took of­fice on July 1, 2012.

Mak quit on July 12, 2012. He and Tsang were then charged and tried, and con­victed of the of­fenses on June 24.

Un­like pre­vi­ous con­victed cases of hous­ing fraud, the two men had no al­ter­nate ben­e­fit op­tion to cover their mort­gage pay­ments.

Cross-leas­ing was per­mit­ted un­der the PTA scheme, which was said to con­tain “struc­tural de­fi­ciency”. Even the own­er­ship swap made it an of­fense, but Chan ac­knowl­edged the men made no ad­di­tional mone­tary gain by cross­ing the line.

He also agreed the level of pub­lic ex­pec­ta­tion for civil ser­vants in the 1980s was dif­fer­ent from that of now. The “grav­ity” of the of­fences was hence sum­ma­rized by the judge as “on the low side of the scale”.

The sen­tenc­ing has also taken the two men’s “out­stand­ing con­tri­bu­tions to the so­ci­ety” into ac­count.

Mak’s char­ac­ter, for in­stance, earned pos­i­tive words from for­mer ad­min­is­tra­tion chiefs Stephen Lam Sui-lung and Henry Tang Ying-yen, and Vice-Chan­cel­lor of the Univer­sity of Hong Kong (HKU), Tsui Lapchee. Fi­nance sec­re­tary, John Tsang Chun-wah, also made a last-minute sub­mis­sion.

Cur­rent Chief Sec­re­tary for Ad­min­is­tra­tion Car­rie Lam Cheng Yuet-ngor was not on the list. But she told re­porters on Thurs­day af­ter a tour in Tuen Mun that if she was in­vited, she would write in fa­vor of Mak’s con­duct and con­tri­bu­tions.

The two men have also re­paid the al­lowances with in­ter­est. Mak paid HK$740,000, while Tsang de­posited HK$1.19 mil­lion in the govern­ment’s ac­count on June 28.

They both showed signs of re­lief af­ter hear­ing the sen­tence. Leav­ing the court­room, Mak raised his thumb to a group of friends at the pub­lic gallery, with a smile on his face. He and Tsang later shook hands in­side a con­fer­ence room.

Out­side the court build­ing, both Tsang and Mak thanked their fam­i­lies and friends for the sup­port over the past year as they ran into TV crews. Mak also said he felt bad for his col­lege pal.

“I’m very sorry for in­volv­ing Mr Tsang in this par­tic­u­lar case,” said Mak. “I think if I had not taken up this post last year, this whole thing would not have ap­peared.” The pair has 28 days to file an ap­peal and Mak said he will dis­cuss with Tsang what to do next.

Mak has been a part-time lec­turer at the HKU since Fe­bru­ary, but did not say whether he would stay in the job. “There is noth­ing else I can tell,” he said.

Tsang is set to re­tire from his post next year. The Civil Ser­vice Bureau told RTHK that it will con­sult the Pub­lic Ser­vice Com­mis­sion as part of the pro­ce­dure to de­ter­mine whether Tsang has to quit early.

Process will also be­gin to de­ter­mine whether the two con­victed men could keep their pen­sions. Judge Chan said it was not a cer­tainty that they will lose their pen­sions.

PRO­VIDED TO CHINA DAILY

For­mer de­vel­op­ment sec­re­tary Mak Chai-kwong leaves the Dis­trict Court in Hong Kong on Thurs­day.

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