On 30th November 2020, the District Court acquitted Roy Cho Kwai-chee (“Cho”), a former director of one of the largest independent financial advisors, Convoy Global Holdings Limited (“Convoy”), of one count of conspiracy to defraud and one count of making false statement by company directors in 香港特別行政區 訴 曹貴子 [2020] HKDC 1126. Also acquitted were two associates of Cho, also former executives of Convoy.
The first charge arose from Convoy’s acquisition of True Surplus International Investment Limited (“Trade Surplus”) on 5th September 2016. It is alleged that Cho, along with two of Cho’s associates, have conspired together to defraud the SEHK, Convoy, its board of directors, and its shareholders by dishonestly concealing that Cho was a shadow director of Convoy, and dishonestly causing Convoy to acquire True Surplus, of which Cho was a 55% shareholder.
The second charge arose from Convoy’s publication of the company’s 2016 annual report on March 29, 2017. Arising from the same fact as above, it is alleged that Cho and his two associates, by failing to disclose Convoy’s transaction with True Surplus where Cho is a related party, made a false statement in Convoy’s annual report.
The charge of conspiracy turned on whether there had been any agreement between the accused. Cho was acquitted on the basis that the Prosecution had failed to lead sufficient evidence to show that there had been an agreement by the accused to dishonestly conceal information from SEHK, Convoy, and its board of directors.
As to his acquittal of the charge of publishing false statements, the District Court held that any problem in Cho’s failure to disclose information of the deal should be the responsibility of the whole board of directors, rather than just the duty of the accused.
Osmond Lam (led by Ching Y Wong SC) appeared for Cho, instructed by Messrs KCL & Partners.