By BETTINA WASSENER
In one of the biggest corruption scandals in Hong Kong in decades, two billionaire businessmen, a former high-ranking civil servant and two other men were charged Friday with bribery-related offenses, a development that could affect Hong Kong’s reputation as one of the least corrupt economies in the world.
The arrests in March of Raymond and Thomas Kwok, joint chairmen of Sun Hung Kai Properties, the biggest real estate company in Hong Kong, sent shock waves through the city, and has been the focus of intense public attention ever since.
The charges accuse the Kwoks and two other men — Thomas Chan Kui-yuen, executive director of Sun Hung Kai Properties; and Kwan Hung-sang, a businessman also known as Francis — of conspiring to provide Rafael Hui, the former chief secretary of the Hong Kong civil service, with the use of two apartments, as well as unsecured loans, in return for unspecified favors.
A total of eight charges were filed by the I.C.A.C. against the five men, including conspiracy to offer advantages to a public servant and misconduct in public office.
Sun Hung Kai did not immediately respond to an e-mailed request for comment, but the company had scheduled a news conference at its headquarters late Friday.
Colin Cohen, a lawyer representing Thomas Kwok, declined to comment.
The case has generated particularly avid public attention because it involves not only some of the most high-profile people in Hong Kong, but also a sector that is tied into the Hong Kong economic and social fabric like no other.
Property plays a huge role in the Hong Kong economy and investment psyche. Many of the tycoon families who control the city’s largest companies owe much of their wealth to the sector. And for citizens of more modest means, homeownership is a common aspiration — despite, or perhaps because, property prices in Hong Kong rank among the highest in the world.
The Kwoks, meanwhile, are among the city’s most prominent, influential and wealthy businessmen.
Sun Hung Kai was founded by the Kwoks’ father, and Forbes magazine earlier this year ranked Thomas and Raymond Kwok No. 27 on its list of the world’s billionaires.
The company is the builder and operator of some of the most prominent and most expensive buildings in the city. Among them are the 88-story Two International Finance Center, which dominates the skyline of the central business district on Hong Kong Island, and the 118-story International Commerce Center, one of the world’s tallest buildings, on the top floors of which is a Ritz-Carlton hotel. Sun Hung Kai also has projects in Beijing, Shanghai and other mainland Chinese cities.
The corruption accusations have taken a heavy toll on the company’s share price, which has plunged 14 percent since the news of the Kwok brothers’ arrests March 29.
The ratings agencies Moody’s and Standard & Poor’s lowered the outlooks on their credit ratings for the company soon after the arrests, with S.&P. commenting at the time that the anti-corruption commission’s investigation “may weaken the stability of its management and reputation of the company.”
Trading in Sun Hung Kai shares was suspended Friday.
The scandal also has ramifications beyond Sun Hung Kai. It is likely to fan public anger in Hong Kong at the links between government and business, perceived by many as being overly close, as well as the large gap between the incomes of the city’s superrich and its ordinary citizens. Hong Kong has one of the widest income discrepancies in the world.
The developments also come at a time of intensifying discontent with the city’s political governance, and a rocky leadership transition that has put the new chief executive of Hong Kong, C.Y. Leung, on the defensive at several recent public appearances.
The alleged offenses are believed to have taken place between June 2000 and January 2009, the commission said in a statement.
A third brother, Walter Kwok, who is estranged from Thomas and Raymond and was ousted as chairman of Sun Hung Kai in 2008, was arrested in late May. He was not among those charged Friday.
Source : nytimes