The director of a Chinese company which produces clothes for leading fashion chains has been accused of deceiving the Bank of China (Hong Kong) into issuing letters of credit (L/Cs) worth more than US$5.5m (€4.69m) to a supplier based on fraudulent business transactions.
He is said to have laundered the proceeds.
Li Mau-yam, a director and shareholder of Mau Wing Industrial, faces one charge of conspiracy to defraud and three of money laundering.
Based in Dongguan near the Hong Kong border, the company produces knitwear for H&M, Levi’s, Zara and other Western fashion chains.
Hong Kong’s Independent Commission Against Corruption (ICAC) alleges that in 2018 Li conspired with an employee and the sole proprietor of a supplier to defraud the bank by dishonestly applying to it to issue three L/Cs for the supplier, knowing there was no genuine underlying commercial transaction for them.
The scheme involved production of false documents, including invoices and cargo receipts, to support the applications, regional news outlet Regulation Asia reported.
Li is also said to have handled three sums of money totalling more than US$5.5m in a bank account of Great Pacific Clothing, which Li owned through another company, knowing or believing the money came from an indictable offence. The funds were subsequently transferred to Mau Wing bank accounts.
Li was released on ICAC bail. The case is due to be transferred to the district court for plea.
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