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 Thomas and Raymond Kwok, the billionaire co-chairmen of Asia's
largest developer, Sun Hung Kai Properties Ltd <0016.HK>, appeared
in court with co-accused Rafael Hui, Hong Kong's former chief
secretary.
The case involves a series of payments and loans totaling more than
HK$37 million ($4.77 million) allegedly paid to Hui, who headed Hong
Kong's civil service from 2005 to 2007.
The three men have pleaded not guilty to all charges, including
conspiracy to offer an advantage to a public servant.
The case has thrown a spotlight on the close relationship between
the city's powerful developers and government in the former British
colony, which returned to Chinese rule in 1997 and has a separate
legal system from the mainland.
Thomas Chan, a board member in charge of land purchases at Sun Hung
Kai Properties, and Francis Kwan, a former Hong Kong Stock Exchange
official, have also been charged in the case. They have also pleaded
not guilty.
Prosecutor David Perry told the court that Hui had abused his
position of power to receive millions of dollars in secret payments
during his term in office.
"His loyalty to the public was compromised and undermined" by the
use of public office and influence for personal gain, Perry said.
Hui, 66, looked on sternly, betraying little emotion as he sat
bespectacled with wispy graying hair as he listened to the opening
remarks.
In the four days leading up to Hui's appointment as chief secretary,
he received HK$8.5 million, Perry said.
In late 2007, Hui received another "secret" payment of HK$11
million, Perry said. The payments, the court heard, were disguised
in a "very, very elaborate way" and "very careful steps" were taken
to ensure no one knew the payments were made.
Perry detailed how the payments came from or were facilitated by Sun
Hung Kai executives including Raymond and Thomas Kwok, routed
through a string of companies including one in Singapore, several
intermediaries and via some 10 different bank accounts. The money
was then disbursed to Hui in smaller segments that included cash,
cheques and cashier orders.
In 2005, Hui also received three sets of payments totaling HK$17.6
million when he was in another post, the court heard. He also lived
rent-free in a luxury Sun Hung Kai property development and received
two loans from the property developer that put him in "a position of
obligation" to the company.
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Perry characterized Hui's behavior as a "deep and serious conflict
of interest" as well as "wilfully misconducting himself" in public
office.
Hui gave the impression that he was a principled official, Perry
said, "but he was not".
Perry, in outlining the thrust of the prosecution's case, said the
Kwok brothers, dressed in dark ash suits and sat expressionless in
the dock, had been motivated to "make sure they had a friend in
government".
In explaining the motive for one of the payments, Perry said Hui
would serve as "the eyes and ears of Sun Hung Kai Properties. It was
a bribe."
The former No. 2 Hong Kong official was close to the city's leader
at the time, Donald Tsang, who referred to him as a friend and
adviser in a letter to Hui that was read in court, saying "he was
personally indebted to Hui" for his public service including as an
advisor on the city's Executive Council.
The trial before Judge Andrew Macrae is estimated to last four
months and involve more than 50 witnesses including senior
government officials, bankers and Sun Hung Kai staffers.
It got under way on Thursday a day after a second nine-person jury
was selected following the discharge of the first one last week
after a juror fell ill, which led to the dismissal of the entire
group of nine.
($1 = 7.7529 Hong Kong Dollars)
(Additional reporting by Nikki Sun and Emily Chung)
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