Even the auditors are in bed with the thieves. In a similar situation in the US there would be lynch mobs and blood on the streets, here in HK there is just ghostly silence from the regulators who are acutely aware who feeds them.
They claimed that David Sun Tak-kei, the independent review partner on the audit from 1991 to 19999, did a mere seven hours of work on Akai's audit in the three years leading up to the company's collapse.
Sun is now Ernst & Young's co-managing partner for the Far East, although he relinquished his other role as chairman for China and Hong Kong on September 30, the day after Ernst & Young's premises were raided by the Commercial Crime Bureau.
Another ex-partner accused of raping Akai by moving it's assets to one of his own companies now settles for US$100m.
The HK police have opened an investigation into E&Y forgery (going by their record this won't amount to much) but hopefully they will open another case into Ho and Grande, not to mention the Akai founder, Ting.
HKEX does what it does best... sweet FA.
SCMP:
Akai saga ends with 'US$100m payout'
Naomi Rovnick
Oct 06, 2009
Almost a decade after the spectacular collapse of Hong Kong electronics conglomerate Akai, the saga has ended with the failed firm's liquidators securing a major moral and financial victory for its creditors.
Hong Kong tycoon Christopher Ho Wing-on and his locally listed company Grande yesterday settled a High Court case brought against them by Akai's liquidators, Borrelli Walsh. The payout exceeded US$100 million, people familiar with the negotiations said.
Borrelli Walsh began suing Ho and Grande for up to US$500 million in late 2007. They claimed Ho conspired with Akai's former chairman James Ting to strip the failed company's assets, so there was nothing left in the business for its creditors. They have also claimed Ting plundered US$800 million from Akai, concealing the thefts with the use of fake bank accounts and fabricated investments. Ho and Grande have denied the claims against them.
On September 23, Borrelli Walsh wrested about US$400 million out of Akai's former accountants, Ernst & Young Hong Kong, which it had accused of audit negligence. The accountant's defence collapsed after the liquidators said the firm had falsified some of its evidence. Hong Kong police are now investigating that claim.
Akai collapsed in 2000 owing more than US$1.1 billion to creditors, including HSBC (SEHK: 0005, announcements, news) and Standard Chartered. When liquidator Cosimo Borrelli took charge of the business in 2001, he found just US$167,000 worth of cash and assets, according to previous court rulings. In the mid-1990s, Akai had more than 100,000 staff and owned brands including America's Singer Sewing Machines, Akai Electric and Sansui.
In November 1999, Ting and Ho injected all of Akai's businesses into Grande, according to multiple court rulings. Akai's shareholders and banks were not told about the deal, which the Hong Kong Stock Exchange has never investigated. EY Hong Kong was alleged to have advised Grande on the transaction.
Ting was imprisoned for false accounting in 2005 but released a year later on appeal, following errors in the prosecution's case.
Grande Holdings now licenses the Akai and Sansui brands to electronics manufacturers, according to its most recent annual report.
The settlement has saved Ho from a potentially embarrassing session in the witness box. He was due to be cross examined by the liquidators' barrister Leslie Kosmin QC.
Last week Ho, through his lawyers, told the court he borrowed HK$500 million for gambling from Sociedade de Turismo e Diversoes de Macau, casino mogul Stanley Ho Hung-sun's holding company. Kosmin said the loan document the Grande boss provided did not look authentic.
In February, Mr Justice William Stone froze Ho's assets to stop him potentially shielding his wealth from the liquidators.
Ho breached the terms of that order by "siphoning" HK$300 million of cash through his family trust, Stone wrote on September 1. Ho then lost control of all his assets, which the judge placed into receivership. With the settlement, this order has been reversed.
Ho, who did not appear in court yesterday, could not be reached for comment. Grande could also not be reached.
Naomi Rovnick
Oct 06, 2009
Almost a decade after the spectacular collapse of Hong Kong electronics conglomerate Akai, the saga has ended with the failed firm's liquidators securing a major moral and financial victory for its creditors.
Hong Kong tycoon Christopher Ho Wing-on and his locally listed company Grande yesterday settled a High Court case brought against them by Akai's liquidators, Borrelli Walsh. The payout exceeded US$100 million, people familiar with the negotiations said.
Borrelli Walsh began suing Ho and Grande for up to US$500 million in late 2007. They claimed Ho conspired with Akai's former chairman James Ting to strip the failed company's assets, so there was nothing left in the business for its creditors. They have also claimed Ting plundered US$800 million from Akai, concealing the thefts with the use of fake bank accounts and fabricated investments. Ho and Grande have denied the claims against them.
On September 23, Borrelli Walsh wrested about US$400 million out of Akai's former accountants, Ernst & Young Hong Kong, which it had accused of audit negligence. The accountant's defence collapsed after the liquidators said the firm had falsified some of its evidence. Hong Kong police are now investigating that claim.
Akai collapsed in 2000 owing more than US$1.1 billion to creditors, including HSBC (SEHK: 0005, announcements, news) and Standard Chartered. When liquidator Cosimo Borrelli took charge of the business in 2001, he found just US$167,000 worth of cash and assets, according to previous court rulings. In the mid-1990s, Akai had more than 100,000 staff and owned brands including America's Singer Sewing Machines, Akai Electric and Sansui.
In November 1999, Ting and Ho injected all of Akai's businesses into Grande, according to multiple court rulings. Akai's shareholders and banks were not told about the deal, which the Hong Kong Stock Exchange has never investigated. EY Hong Kong was alleged to have advised Grande on the transaction.
Ting was imprisoned for false accounting in 2005 but released a year later on appeal, following errors in the prosecution's case.
Grande Holdings now licenses the Akai and Sansui brands to electronics manufacturers, according to its most recent annual report.
The settlement has saved Ho from a potentially embarrassing session in the witness box. He was due to be cross examined by the liquidators' barrister Leslie Kosmin QC.
Last week Ho, through his lawyers, told the court he borrowed HK$500 million for gambling from Sociedade de Turismo e Diversoes de Macau, casino mogul Stanley Ho Hung-sun's holding company. Kosmin said the loan document the Grande boss provided did not look authentic.
In February, Mr Justice William Stone froze Ho's assets to stop him potentially shielding his wealth from the liquidators.
Ho breached the terms of that order by "siphoning" HK$300 million of cash through his family trust, Stone wrote on September 1. Ho then lost control of all his assets, which the judge placed into receivership. With the settlement, this order has been reversed.
Ho, who did not appear in court yesterday, could not be reached for comment. Grande could also not be reached.
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