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ICAC
BusinessBanking & Finance

Hong Kong court finds a broker and three former executives guilty of fraud, in a win for ICAC’s clean-up of Convoy’s financial scandal

  • The four were charged with conspiracy to defraud Convoy Global Holdings, its board of directors and investors in four bond placements in 2014 and 2015
  • The guilty were allowed to remain on bail pending a mitigation and sentencing hearing on October 9

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The @Convoy building, which houses the headquarters of the Convoy Financial Group in Hong Kong, pictured in December 2017. Photo: Bloomberg
Enoch Yiu

Hong Kong’s graft busters scored a victory in their attempt to prosecute one of the city’s biggest financial fraud cases in recent decades, when a court declared three former executives of Convoy Global Holdings and a broker guilty of conspiracy to commit fraud.

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Convoy’s former chief executive Mark Mak Kwong-yiu, former chief financial officer Christie Chan Lai-yee, and former manager Wong Shuk-on were found guilty alongside the broker Lee Yick-ming of charges to defraud the company over a HK$51 million (US$6.58 million) kickback involved in four bond placements in 2014 and 2015, according a verdict by the Deputy District Court Judge Newman Wong Hing-wai.

The three former Convoy executives were also found guilty of defrauding the Hong Kong stock exchange. They will remain on bail until their next hearing on October 9 for mitigation and sentencing, according to the court schedule.

The verdict marks the first victory for Hong Kong’s Independent Commission Against Corruption (ICAC) since the anti-graft agency began its investigation with the city’s securities watchdog agency into Convoy’s financial dealings in December 2017. One of the largest advisers of Hong Kong’s Mandatory Pension Fund (MPF), Convoy was a crucial piece of the so-called Enigma Network, a cluster of interrelated companies with layers of overlapping shareholdings that have defied years of regulatory crackdown amid suspicions of fraud, market manipulation and corporate malfeasance.
Mark Mak Kwong-yiu, former chief executive of Convoy Global Holdings, during a press conference on June 28, 2010, at the Convoy Wealth Centre on Des Voeux Road Central in Sheung Wan. Photo: SCMP
Mark Mak Kwong-yiu, former chief executive of Convoy Global Holdings, during a press conference on June 28, 2010, at the Convoy Wealth Centre on Des Voeux Road Central in Sheung Wan. Photo: SCMP
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Convoy is the largest independent financial adviser in Hong Kong with more than 100,000 customers. Trading in Convoy’s shares has been halted since December 2017, and its management has changed after a high-profile joint investigation by the ICAC and the Securities and Futures Commission (SFC) went public.

The company’s shares were delisted in May this year. Its largest shareholder – the family of Richard Tsai Ming-hsing of Taiwan’s Fubon Financial Holdings, with a 29.98 per cent stake, is in control of the board now.

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