CCAC uncovers alleged listing fraud in HKEX involving construction firm

The Commission Against Corruption (CCAC) uncovered an alleged case of listing fraud involving a Macau-based construction company and a Hong Kong accounting group.

According to the CCAC, the Macau firm allegedly conspired with four auditors and consultants from a Hong Kong accounting enterprise to falsify financial statements submitted to the Hong Kong Exchanges and Clearing Limited (HKEX).

In collaboration with Hong Kong’s Independent Commission Against Corruption (ICAC), the anti-corruption watchdog said the firm the falsified reports were intended to mislead the HKEX into approving the company’s listing application on the Main Board.

The person-in-charge of the construction company is a Macau resident. Upon identifying possible criminal activity, the CCAC launched an investigation, which revealed that false accounts were deliberately produced to misrepresent the firm’s financial standing. The company later offered a reward of HKD1.5 million to those involved as compensation for subscribing to its initial public offering.

The joint probe between the CCAC and ICAC began in 2021 and included search operations at the company’s Macau office and the local branch of the implicated accounting group. Several individuals were also questioned.

The ICAC has already filed charges against the auditors and consultants. Investigations remain ongoing in both jurisdictions.