Barry Cheung, former chairman of the defunct Hong Kong Mercantile Exchange (HKMEx), was taken away from his home by officers from the Commercial Crime Bureau on Thursday and charged with conspiring to defraud the securities regulator, the Hong Kong Economic Journal reports.
Jacky Choi, the commodities trading platform’s former chief financial officer, was also arrested.
The duo appeared in Eastern magistrates’ court later that day before principal magistrate Bina Chainrai who granted them HK$50,000 bail each. They were prohibited from leaving Hong Kong or contacting witnesses.
The case was transferred to Wan Chai district court, where it will be heard on Aug. 24.
According to the prosecution, Cheung, 59, and Choi, 48, conspired to mislead the Securities and Futures Commission over the performance of HKMEx between May 2012 and May 2013 so as to prevent the regulator from revoking its trading license.
Cheung also faces a separate count of fraud for allegedly cheating a company named Sinomax Finance out of HK$30 million in 2013 to benefit New Effort Holdings, a British Virgin Islands firm, which was the majority shareholder of the exchange owned by Cheung.
Cheung, a prominent businessman, was known as the No. 1 supporter of former chief executive Leung Chun-ying.
He helped Leung manage his election campaign in 2012 and later became an executive councilor and chairman of the Urban Renewal Authority after Leung was elected.
In 2015, Cheung was accused of failing to pay wages to an HKMEx employee but escaped jail time. He was senteced to a community service.
Cheung founded HKMEx in 2008 but deteriorating finances led to its closure in 2013. He quit all his public roles in May 2013 and was declared bankrupt in 2015.
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