Dr. K was a partner of a large private medical centre. Medical records of the centre were computerised to enhance storage efficiency and retrieval of patients’information. Every employee had access to the records since no password was required.

Robert, a private detective, was entrusted by his client Mrs. CHAN to keep surveillance on her husband who was suspected to have an affair with another woman. Discovering that Mr. CHAN’s mistress had paid frequent visits to Dr. K recently, Robert tried to seek assistance from the clinic assistant Eva to access relevant medical records. Robert agreed to offer Eva $10,000 as a reward for her help. Subsequently, Eva passed Robert a copy of the medical record of the mistress who had been confirmed pregnant.  Eva accepted the money from Robert in return.

Dr J is a general practitioner in private practice.   On one occasion, his friend Tony, an insurance agent, suggested to him a plan for earning quick money.   The Personal Accident Insurance Policy (PAI) offered by his company would provide insurance compensation for an injury caused by an accident resulting in death, permanent or temporary disability to an insured.   All claims under the PAI had to be supported by a form issued and signed by a registered doctor in Hong Kong.   Tony knew many construction workers and, as a first step, he  would  suggest  to  them  to  buy  PAI  policies  from  him.    These individuals would make claims later, even though they just suffered from minor injuries.   What Dr J could help was to exaggerate the seriousness of the injuries when filling in the worker's claim forms as the attendant doctor, thus resulting in higher compensation payments.   The “profit” could then be split among all parties.

Andrew was the chief accountant of a large trading company.  Due to keen competition, the business of the company deteriorated substantially.  To improve the situation, the company attempted to invest in the Mainland.

When reviewing the books and bank statements, Andrew found that there was evidence of fraudulent activities involving some sales representatives. Andrew discovered that there were no supporting documents for some cash payments claimed by the sales representatives.  When asked for explanations, the sales representatives replied that those expenses had been incurred for the purpose of building up new businesses in the Mainland.  They further explained that the offering of commission to agents of business clients was a common practice.  When consulting the Marketing Director who was a long serving staff of the company, Andrew was told that the expenses were approved by  the Marketing Director personally. 

With no choice, Andrew went to see the Vice-president.  The Vice-president pacified Andrew and told him that in real business life, the company had to tolerate some minor variations in order to get the job done.

Next day, a cheque was placed on Andrew’s desk and the phone rang.  It was the Marketing Director.  Andrew was asked to sign the cheque and was told that it would be deposited in a designated Hong Kong bank account belonging to a buyer of a firm in the Mainland.  The arrangement enabled the buyer to pay for his various expenses while on business in Hong Kong.  He further suggested that the sum could be paid by an overseas subsidiary of the company.

Although Andrew knew that the client was very important to the company, he suspected that the payment might be unlawful.

What should Andrew do?

Mike, a certified public accountant, was the voluntary treasurer of the parent-teacher-association (PTA) of the private school which his son attended.  Though the PTA had an annual expenditure budget and raised substantial funds each year, no formal accounting reports had been made by the school.  The new PTA Chairman thought it was time to clarify the current financial position of the association and asked Mike for assistance.

When going through the accounting records, Mike discovered several red flags: the actual expenditures were inconsistent with the approved budget; the cash balance fluctuated without explanation; and the cash inflows from fund-raising events did not match with the accounting records.

Mike then approached the school secretary, who looked after the PTA’s accounts, for clarification.  However, the school secretary repeatedly gave vague and evasive responses. As Mike did not have access to the school’s accounts and lacked important information to determine the cause of the problems, he suspected that a fraud might be involved. Meanwhile, the school principal had recently indicated concerns on the academic performance and constant school behavioural problems of Mike’s son.

Mike was uncertain if he had any professional obligations as a voluntary treasurer in the PTA.  He was also worried whether reporting the suspected fraud would cause the school any trouble and affect his son’s interests in school. What should Mike do?   

Jimmy and Billy studied Accounting and Finance in the same university and became very good friends.  After graduation, Billy started his own trading business.  His company, B&B Co. Ltd., had been expanding very fast and achieving a huge annual turnover.  Jimmy pursued his career in accountancy and worked hard to become a partner in a CPA firm.  Naturally, B&B Co. Ltd. became one of the major clients of Jimmy's firm, contributing to 20% of its professional income.

This year, B&B Co. Ltd. was facing a very difficult position.  Apart from losing a few major customers, a significant loss was discovered after Jimmy's firm completed the year-end audit for B&B Co. Ltd.

Jimmy was invited to lunch by Billy.  Over the lunch Billy told Jimmy that he was negotiating a big order.  If he could successfully apply for a line of credit with a bank to handle the order, B&B Co. Ltd.'s position would turn around. By then, even more services would be needed from Jimmy's firm. 

However, he was worried that if the bank was aware of B&B Co. Ltd.’s current financial position, it would not grant credit facilities.  Billy then asked Jimmy to use whatever device to improve the financial position of his company and promised to duly reward Jimmy with a luxurious car after overcoming this hurdle.  If Jimmy refused his request, he had no choice but to appoint another CPA firm next year.

ABC Co. Ltd. (ABC) manufactured a wide variety of toys and games for children.  Ben had been the auditor of ABC and befriended its owner, Dale, for years. They were good friends and both found their business relationship quite rewarding. The growth of ABC had given Ben opportunities to provide additional services to the firm and its owner.

Due to contractions of the toy industry, ABC was facing serious financial difficulties.  When auditing the accounts of ABC, Ben discovered the financial impact of the industry contraction on ABC.  Sales of ABC declined while receivables and inventory went up.  The audit also revealed material quantities of slow-moving stock which was confirmed by the marketing manager and production manager.

When Ben informed Dale of his findings, Dale replied that he intended to design and produce more creative toys to boost up the sales in order to save the company from bankruptcy. However, it required large capital outlays for manufacturing equipment.  Dale asked for Ben’s help to manipulate the accounting records, so that he could successfully apply for a large loan from the bank.  In return, Dale offered a luxury clubhouse membership to Ben as a token of thanks.

What major factors should Ben consider when handling Dale’s request?  What should Ben do? 

Teddy was a clerk employed by a solicitor firm and much trusted by his employer.  The firm’s major source of income was property conveyancing and Teddy was responsible for handling all the paper work of the property deals.  Teddy would get married soon but his fiancée wanted a grand wedding ceremony which put Teddy under a lot of financial pressure.  

One day, Teddy had dinner with his friend Barry who worked in a bank. Teddy talked to Barry about his financial worries.  Barry responded that perhaps they could work out something together for their benefits.  Barry suggested that he would submit some forged mortgage loan applications to his bank with the support of fake conveyancing documents with inflated property values prepared by Teddy.  Barry ensured Teddy that no questions would be asked by the bank.  After that, they could equally share the approved loans.  Teddy decided to take the risk and agreed to Barry’s plan.

Lily, a litigation clerk in a solicitor’s firm, was gentle and pleasant by nature.  One day, she was tasked to institute legal proceedings for covering arrears of rents of $900,000 and possession of four premises on behalf of the firm’s client.

Lily visited the premises and spoke to the tenants.  She was appalled by their hardship, especially after hearing the tales of woe spun by the tenants.  She agreed with the tenants that the landlord was too harsh on them and had been charging a cut-throat rent.  Many families would have to sleep in the streets if evicted.

Lily wished that she could do something to help.  She kept stalling for time and deferred carrying out what she had been instructed to do.  Weeks passed.

The client became impatient and complained to Lily’s boss, Henry. Lily made an excuse that she was too busy with other chores at that time. Henry accepted her explanation.  But when the client complained again, Henry started to give pressure on Lily.  Lily went to talk to the tenants who pleaded to Lily desperately.

What should Lily do?  Should she confess that she had not carried out her duty because she was sympathetic to the tenants’ plight? Would her lack of action be an indication of her inefficiency and lack of commitment to her job?  Would they suspect that she had received advantages for so doing?

Baldwin, a legal clerk of a very respectable legal firm specializing in criminal cases, was responsible for handling paperwork, filing documentation, communicating with clients, as well as setting appointments and meetings.

Recently, Baldwin was handling a criminal case for a client, Timothy, who was a sales representative in a jewelry wholesale company and was charged with two counts of theft amounting to around $250,000.  Timothy claimed that he was unduly implicated when his colleague suddenly resigned soon after the thefts were discovered.  Fearing to be convicted, both Timothy and his wife were desperate to seek legal assistance.

Sensing the desperation of his client, Baldwin tried to take advantage of the situation.  Baldwin hinted to Timothy and his wife that their chance of winning was half-and-half but it would certainly increase with Baldwin’s expertise.  He also stated that the legal fees would be expensive but worthwhile because Timothy’s reputation within the trade was more important.  The couple was so eager that they were willing to pay whatever it took to get out of the mess.

Soon after, Timothy and his wife came to the legal firm for a meeting with Baldwin.  At the end of the meeting, the couple gave an envelope to Baldwin saying that its content was a token of appreciation if Baldwin could help Timothy off the hook.  Baldwin opened the envelope and bundles of cash came into sight.  Baldwin gladly accepted the ‘token’.  However, Timothy was eventually convicted due to substantial evidence.

Did Baldwin violate any legislation for accepting money from his clients even though the outcome of the whole case was really not up to him to manoeuvre?

In the midst of the rush to get overseas passports, Hong Kong people cast their eyes to countries far and near.  Some thought of Pollyanna, a small country in Europe.  Stories went round that there was a quick means to secure a Pollyannese passport.  They only had to make about $500,000 donation to a political party in Pollyanna as well as investing in the property market there.  In this way, they could bypass normal formalities and procure their passports in a short time.  Many people fell for the scheme and got hold of Pollyannese passports in this manner.

Michael was a solicitor who had been in the profession for a long time.  He was now a wealthy man enjoying great respect.  When one of his friends invited him to take on clients and help them to procure Pollyannese passports in this way, Michael began to ponder.

Should he assist in expediting normal procedures?  Would it be alright for him to participate in a shady scheme like this? As a legal professional, should he consider whether the means in achieving the ends were ethical from his professional perspective?