Case Studies

Conspiracy with Intermediaries to Submit False Information on Account Opening Applications

A bank requires customers, who wish to open a corporate bank account, to attend its branches in person for due diligence purpose. As some of its customers consider inconvenient to come to Hong Kong or the branches in person, the operator of an intermediary company, which assists its customers to open bank accounts in Hong Kong, offers advantages to a bank manager for his assistance in opening accounts for the customers who cannot visit the branches personally.

As its general practices, the bank relies on its bank managers to witness the attendance of customers and check the originals of the customers’ supporting documents and sign to certify true copies of the documents. Knowing the bank’s practices, the bank manager falsely indicates on the application forms that those customers have visited the branch in person for the account opening process, and signs to certify copies of the customers’ identity documents without checking the originals. The bank manager then submits the application forms together with the certified true copies of documents in support of the applications.

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Soliciting Handling Fees for Opening Corporate Accounts from Customers A relationship manager of a bank is responsible for opening bank accounts for customers. The relationship manager solicits from some customers a handling fee for opening a corporate account, to which the bank actually has no such requirement. Moreover, the relationship manager informs the customers that he can exert influence to expedite the account opening process upon receipt of the fee. Some customers accede to the relationship manager’s request and agree to the payment. Those customers pay the fees to the relationship manager’s personal bank account accordingly. See More
Offering Gifts to Public Servants while Having Business Dealings A public body regularly places its surplus fund into bank deposits and/or investments.  A finance manager of the public body (i.e. public servant) is responsible for inviting banks to submit quotations including proposals for placement of fixed deposits and/or investments.  During a quotation exercise, a bank manager who has submitted proposals to the public body sends mooncake coupons to the finance manager as gifts during Mid-Autumn Festival. See More
Offering/Accepting Advantages in relation to Loan Extension A corporate customer holds a loan at a bank. He runs into cash flow problem and cannot service the loan repayment. The corporate customer offers expensive gifts such as watch and cigars, to a bank manager and asks for extension of the loan repayment due date for a couple of times. Despite the fact that the bank has issued clear guidelines to all staff on the prohibition of acceptance of any advantage by its staff in performing the bank’s duties, the bank manager accepts the gifts, and endorses the extensions of the loan repayment due date when it is within his approving authority or makes favourable recommendations to the bank when it is beyond his authority. The bank grants extensions as recommended. See More