Former adviser to Hong Kong’s ex-leader C Y Leung convicted of fraud

A former adviser to Hong Kong’s ex-leader Leung Chun-ying has been found guilty of conspiring with his financial officer to defraud the market regulator.

Barry Cheung Chun-yuen, 61, was also found guilty of fraud, for cheating a firm out of HK$30 million in an attempt to seek quick funding to keep his commodities futures market afloat, before the authorities shut down the platform in May 2013.

The founder of the now-defunct Hong Kong Mercantile Exchange (HKMEx) was widely regarded as one of Leung’s top aides, acting as his campaign chairman when he ran for the city’s top job and later as an executive councillor after he took office in 2012.

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But Cheung stayed less than a year in Leung’s de facto cabinet as he resigned from all public posts when HKMEx was being investigated in May 2013.

Cheung has denied one count of conspiracy to defraud – jointly charged with the trading platform’s former chief financial officer, Jacky Choi Tat-ying, 50, who has pleaded guilty – and another count of fraud.

But District Judge Amanda Woodcock found there was overwhelming evidence against Cheung and convicted him on both charges.

Conspiracy to defraud carries a maximum sentence of 14 years in prison, but that jail term is capped at seven years at the District Court.

Prosecutors had accused Cheung and Choi of conspiring, between May 2012 and May 2013, to hide the HKMEx’s true financial position and mislead the Securities and Futures Commission into letting it keep its authorisation to provide automated trading services in Hong Kong.

Cheung was further accused of cheating a company called Sinomax Finance out of HK$30 million for the benefit of New Effort Holdings, a British Virgin Islands-based firm wholly owned by Cheung, who was the majority shareholder in the exchange.