Hong Kong court hears tycoon Jimmy Lai transferred tax haven company to middleman who linked him up with global lobbying group

Court told by ex-Lai executive that control of British Virgin Islands-based firm was given to Wayland Chan, a former member of an anti-government campaign group
Lacock Inc. was wholly owned by Lai until its control was transferred to Chan in 2020 as reward for help

Jimmy Lai trial

Brian Wong

Published: 10:13pm, 7 May 2024

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Hong Kong media tycoon Jimmy Lai Chee-ying agreed to hand over ownership of one of his private companies to a middleman for a global lobbying group as a reward for “help” given in 2019, the height of civil unrest in the city, a court has been told.

Royston Chow Tat-kuen, a former executive in Lai’s Next Digital group, appeared at West Kowloon Court on Tuesday as the sixth prosecution witness to testify in the Apple Daily founder’s marathon trial under the Beijing-imposed national security law.

He was asked to explain a plan in September 2019 to give ownership of Lacock Inc. to Wayland Chan Tsz-wah, a paralegal and former member of the “Fight for Freedom. Stand with Hong Kong.” (SWHK) campaign group.

The court heard the dormant company, based in the British Virgin Islands, a UK Overseas Territory and tax haven, was wholly owned by Lai.

The West Kowloon Law Courts Building in Cheung Sha Wan, the venue for the trial of tycoon Jimmy Lai. Photo: Jelly Tse

The tycoon, his right-hand man Mark Simon and Chow were the authorised signatories for its bank account before Chan took control in January 2020.

Simon, who formerly worked for US naval intelligence, explained to Chow the change in Lacock’s ownership was approved by their boss Lai.

“He came to my office and explained that because this Chan Tsz-wah helped Mr Lai with some businesses, Mr Lai passed this company to him as a reward. I didn’t ask any further,” Chow said.

The witness, who was Next Digital’s chief financial officer and chief operating officer, added he had no knowledge about Chan nor the reason for the transfer of ownership.

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Lai, 76, is on trial on two conspiracy charges of collusion with foreign forces and a third of conspiracy to print and distribute seditious publications.

Chan, who has also appeared as a prosecution witness, earlier testified that he had linked the tycoon to activists from SWHK to agitate for international sanctions and other hostile acts against Hong Kong and mainland China.

He said Simon made a promise in July 2019 to help him start a personal business as a reward for his contribution to a global advertising campaign, which was launched the previous month to appeal for international action against Hong Kong amid that year’s anti-government protests.

Robert Pang Yiu-hung, Lai’s senior counsel, highlighted that Simon’s conduct and statements could not be used to implicate his client, but might demonstrate the degree of involvement by the US national, who was alleged to be a co-conspirator in the case.

Anthony Chau Tin-hang, for the prosecution, drew the witness’s attention to email correspondence that detailed Lai’s personal expenses in May and June 2019.

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He questioned the purpose of the transfer of HK$3 million (US$383,592) to Simon for what was said to be his “projects”.

Chow said he believed Simon was involved in some overseas publicity campaigns, but that he knew nothing of the details.

The former Next Digital executive was twice arrested by national security police and charged over fraud allegations in connection with the use of office space at Apple Daily, Lai’s now-closed tabloid newspaper.

But he was granted immunity from prosecution on condition he gave “full and true evidence” in trials involving his former employer.

Chow’s testimony continues on Wednesday.

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