Two printing company employees charged by ICAC sentenced for fraud by concealing conflicting interest over $1m delivery service fees

Two employees of a printing company, charged by the ICAC, were sentenced today (August 17) after admitting at the District Court that they had deceived the company into engaging a relative of one of them to provide delivery services by concealing a conflict of interest, thereby making personal gains of about $1 million.

So Keung, 53, former assistant production manager of Bannershop Hong Kong Limited (Bannershop), received a jail term of 10 months; and Zhang Haiqi, 34, former delivery section supervisor of Bannershop, was sentenced to seven months’ imprisonment, suspended for 12 months. The duo pleaded guilty today to one count of fraud, contrary to section 16A(1) of the Theft Ordinance.

In sentencing, Deputy Judge Mr Terence Wai Hon-hei remarked that So had orchestrated the scam and reprimanded both defendants for breaching the trust placed in them. The court reduced their sentences, taking into account their guilty pleas, full compensation made to their former employer and other mitigating factors.

Meanwhile, the charge against So’s wife, Poon Po-lin, 55, was left on file at the District Court.

Bannershop engages in digital printing, graphic design, exhibition decoration and installation. Its staff handbook and code of conduct stipulate that if an employee’s spouse or siblings have any business dealings with the company, the employee must report it to the company and avoid any conflicts of interest.

At the material time, So managed the production of printed products, while Zhang was responsible for managing the delivery of printed products to customers. The court heard that in February 2018, So’s brother-in-law was engaged to deliver products to customers upon Zhang’s recommendation.

Between May 2018 and January 2022, Zhang submitted relevant delivery notes to the company, and delivery fees totalling approximately $6.6 million were paid to the brother-in-law through Poon’s bank account. Upon So’s instruction, Poon subsequently transferred about $5.6 million to the brother-in-law and the remaining $1 million was split between So and Zhang, who received around $700,000 and $300,000 respectively.

The ICAC investigation arose from a corruption complaint. Enquiries revealed that So claimed the brother-in-law was his friend; he had never disclosed their familial relationship to Bannershop, nor did he declare that Poon was his wife.

The ICAC recommends that private sector organisations formulate clear guidelines and mechanisms for declaring conflicts of interest. Staff members are reminded to avoid conflicts of interest and to make timely declarations to their employers. Employees who conceal any conflicts of interest in relation to their official duties to benefit themselves or their associates may constitute a breach of the Prevention of Bribery Ordinance or other criminal laws.

Bannershop had rendered full assistance to the ICAC during its investigation into the case.

The prosecution was today represented by Senior Public Prosecutor Audrey Parwani, assisted by ICAC officer Park Wong.