It was not until June 1993, 4 months before the 10-year anniversary of the Vickers da Costa Special Review on Carrian Investments Ltd, that Hongkong was hit by a bombshell when the former Chairman of a deposit-taking company in Hongkong, Mr Lorrain Osman, admitted that he had conspired with Mr George Tan Soon Gin to defraud Bumiputra Malaysia Finance Ltd.
Mr Lorrain Osman, who had fled to London, England, in order to escape, being brought to book in Hongkong, had been held in Brixham Prison, pending extradition to Hongkong.
For more than 7 years, he stayed in Brixham Prison while his Hongkong solicitor filed one writ of Habeas Corpus after another, presumably on instructions of his client, in order to keep his client out of Hongkong.
As Mr Lorrain Osman rotted away in an English prison, his Hongkong solicitor grew richer and richer, thanks to the fees that he earned from his incarcerated client.
Hongkong’s Independent Commission Against Corruption was rather keen to interview Mr Lorrain Osman about matters, relating to Mr George Tan Soon Gin and his operations, but it was not to be.
The rationale behind the chosen path of Mr Lorrain Osman, in view of his many statements, avowing his innocence of the charges which had been levelled against him, has never been fully explained, even to this day.
On June 25, 1993, however, he admitted, openly, that he had conspired with Mr George Tan Soon Gin and others, who worked for Carrian Investments Ltd and Bumiputra Malaysia Finance Ltd between December 1979 and October 1983.
He admitted that the object of the conspiracy was to defraud Bumiputra Malaysia Finance Ltd, its Kuala Lumpur-based, parent bank, Bank Bumiputra Malaysia Berhad, and the Government of Malaysia.
He admitted that he had agreed to have Bumiputra Malaysia Finance Ltd lend to a shell company, controlled by Mr George Tan Soon Gin, and formed, especially, to accept loans, totalling $US292 million (about $HK2.28 billion).
Mr Justice Mortimer sentenced Mr Lorrain Osman to a term of one year in prison, after taking into account his long incarceration in Brixham Prison, pending extradition proceedings.
He served less than 2 months in a Hongkong prison after the Hongkong justice system took into consideration the fact that he had already served 6 months in the Laichikok Detention Centre, awaiting trial, and another 4 months for remission.
Mr Lorrain Osman was a solicitor by profession and, as such, he must have known of the consequences of his acts, if caught, yet he agreed to participate in the scam in spite of the fact that the chances of success were minimal.
One would have thought, considering the number of statutory declarations, which would have had to be made in Malaysia and Hongkong, to the Government of Malaysia and to The Commission of Banking of Hongkong, that such attestations would lead to his eventual discovery.
And yet he agreed to participate.
Questions that remain unanswered include:
That there had been a convoluted scam, aimed at defrauding, obliquely, the Government of Malaysia, and that Mr Lorrain Osman and Mr George Tan Soon Gin conspired together to perpetrate the scam was admitted in open Court by Mr Lorrain Osman, but the reward which was to go to Mr Lorrain Osman has never been established.
It is believed that Mr Lorrain Osman paid tens of millions of Hongkong dollars to Hongkong solicitors, during his 90 months in a Brixham Prison, in order to avoid being extradited to Hongkong to stand trial.
As it transpired, that money was completely wasted, at the end of the day.
But it is fact that he had that amount of money to spend on Hongkong solicitors, money that must have been part of his ill-gotten gains from the scam.
Yet, at the end of the trial when Mr Lorrain Osman, who was, then, 62 years old, was about to board an aeroplane, travelling first class along with his Hongkong solicitor, to take him to England, he claimed that he had lost everything: His former good name; his money; and, his future.
In fact, while in prison in Hongkong, he was served with a Bankruptcy Petition from the Attorney General.
There is, also, a number of other questions which the Authorities of Hongkong and Malaysia would, still, appreciate to learn the answers:
The events, leading up to the matter of Mr Lorrain Osman, pleading guilty to corruption, are a story by themselves, but they leave a lot of questions unresolved.
On December 6, 1985, while Mr Lorrain Osman was sitting in his London home with his former colleague of Bumiptra Malaysia Finance Ltd, Mr Mohammed Hashim Shamsuddin, the police entered the home in order to arrest Mr Mohammed Hashim Shamsuddin.
Less than one year later, waiving his rights to a Hearing on a Writ of Habeas Corpus in order to avoid extradition to Hongkong, Mr Hashim Shamsuddin admitted to assisting in the defrauding of Bumiputra Malaysia Finance Ltd of about $HK1.05 billion.
He, also, admitted that he had accepted $HK15 million in bribes for his corrupt activities.
He was sentenced to a jail term of 10 years in Stanley Prison, Hongkong.
In that same year, Mr George Tan Soon Gin and Mr Bentley Ho, along with Mr Rogerio Lam and Mr Stephen Lam, the Chairman and a Director of publicly listed Bylamson and Associates (Enterprises) Ltd, respectively, Mr David Begg and Mr Anthony Lo, both of the accounting firm of Price Waterhouse, as the firm was then known, were all charged with conspiracy to defraud between January 1, 1981 and July 31, 1982.
The charges against these 6 gentlemen were that they conspired to defraud shareholders, or potential shareholders, of Carrian Investments Ltd, and/or creditors, or potential creditors, of any other person or company, who might have been induced to accept shares in Carrian Investments Ltd as collateral for loans to the 6 gentlemen or to Carrian Investments Ltd, Carrian Holding Ltd, or any company in which the 6 gentlemen had a legal or beneficial interest, by false and misleading statements and by concealments as to the profits, liquidity and financial integrity of Carrian Investments Ltd.
The trial judge was a former Court of Appeals Justice, Mr Justice Barker, who agreed to be the trial judge even though it meant stepping down a notch in terms of his august position in the Hongkong Judiciary.
Before the trial began, while having tea with a then prominent solicitor in the Mandarin Hotel, where Mr Justice Barker was staying, he informed the solicitor that, having read the 25,000 pages of the Crown’s case against the 6 defendants, he was of the opinion that the defendants had no case to answer.
He was correct and, after a 281-day trial, which cost Hongkong taxpayers more than $HK40 million, he stopped the trial and delivered his determination: The defendants had no case to answer.
During the trial, he took long luncheons in The Hongkong Club and, nearly always, drank copius quantities of alcohol.
This I, personally, confirmed in conversations with bartenders of The Hongkong Club.
On one occasion, he attended court in an intoxicated condition, having lost his balance, during his short walk from The Hongkong Club to the courtroom.
His friendship with the accused was noted by the prosecution, a Queen’s Counsel with whom I had a number of meetings.
At the start of each trial day, it was common for Mr Justice Barker to ask, prior to the start of the day’s proceedings: ‘Mr Tan, I hope you are well, today’, or statements to that effect.
After the trial, Mr Justice Barker retired to Malta where he died.
Less than one year after the trial, a former executive of Barclays Asia Ltd, the Hongkong subsidiary of Barclays Bank plc, was tried for accepting bribes in relation to the Carrian Case.
Mr Stuart Leslie Turner was convicted and jailed.
He was released one year later.
Mr George Tan Soon Gin continues to be involved in business in Hongkong and has a house in the New Territories, which he built at a cost of about $HK200 million.