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Stringent vetting procedures are in place to guard against attempts to defraud or abuse the Protection of Wages on Insolvency Fund (PWIF), the Permanent Secretary for Economic Development and Labour (Labour), Mr Matthew Cheung Kin-chung, said today (August 5).

He was commenting on today's arrest by the Commercial Crime Bureau (CCB) of the Hong Kong Police of a company director and 10 persons who had been represented to be employees of a piling company. They are suspected of conspiracy to defraud the fund.

"We take a serious view of any attempt by any person to obtain payments fraudulently, and we will take every measure to combat those who provide false information with intent to defraud the PWIF," Mr Cheung said.

"The Labour Department will continue to stringently vet applications for ex-gratia payments from the PWIF and refer all suspected frauds and PWIF abuse to the relevant authorities for investigation."

He said that a special task force comprising representatives of the Labour Department, the Commercial Crime Bureau, the Official Receiver's Office (ORO) and the Legal Aid Department had been set up to clamp down on suspected frauds and abuses of PWIF.

"It proactively investigates possible frauds, misfeasance and theft by directors or workers," he said.

"Since its formation, the CCB has already prosecuted an employer, a foreign domestic helper and the manager of a printing company who conspired to defraud the PWIF. In two other conspiracy cases, two directors and 11 employees of a transportation company, and a manager and five employees of a restaurant were arrested for further action," he added.

"Based on suspected crimes reported by employees or directors of insolvent companies, and suspected offences detected in verifying employees' claims, the department has already referred 30 cases to the CCB and the ORO for further investigation," he said.

The maximum penalty for providing false information in applying to the PWIF is a fine of $50,000 and three months' imprisonment.

As at June 30, the balance of the PWIF stood at $23 million. There is no need at present to draw on the $695 million bridging loan provided by the Government.

End/Tuesday, August 5, 2003

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