Hong Kong’s anti-corruption watchdog has arrested seven people linked to a syndicate that allegedly targeted large maintenance projects through undisclosed conflicts of interest and a contractor who served in a dual role as consultant.
The Independent Commission Against Corruption (ICAC) on Tuesday said it had arrested five men and two women, aged 37 to 75, last week, including the chairman of an incorporated owners committee, the owner of a project contractor and the directors of a project consultancy firm.
The watchdog said it had launched its investigation after receiving a complaint about possible corruption in the tendering exercise for a large maintenance project at a single block in Mong Kok.
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It found that the project contractor’s owner allegedly controlled the project consultancy firm through his associates, secured the consultancy contract for the maintenance project at a low price and concealed his dual roles as project contractor and consultant with intent to induce the incorporated owners to choose his company for the project.
The watchdog found that the consultancy firm had failed to declare its conflict of interest, while the chairman of the incorporated owners’ committee was also suspected to have known about the issue and concealed it.
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Ultimately the contractor failed to secure the project, valued at HK$20 million (US$2.6 million), after property owners began to suspect irregularities in the tendering process.
The watchdog also found that the project consultancy firm and contractor had concealed their relationship and conflict of interest in two other major maintenance projects currently undergoing tender exercises.