Pro-democracy tycoon Jimmy Lai had no financial motive in breaching the terms of the lease for his Apple Daily newspaper headquarters by operating a consultancy from the same building, a court which convicted him of fraud was told.
Lai, 74, and Wong Wai-keung, the administrative director of Apple Daily’s parent company Next Digital, appeared in front of Judge Stanley Chan in District Court on Thursday morning.
Lai, who goes on trial separately for alleged national security offences next week, was convicted of two counts of fraud on October 25.
He was found to have breached the terms of the lease for Apple Daily’s headquarters by concealing the operations of Dico Consultants from the government’s Hong Kong Science and Technology Park Corporation from April 1, 1998, to May 19, 2020. The lease specified the premises should be used for the purposes of printing and publishing.
Wong was found guilty one count of fraud relating to the period between January 1, 2016, and May 19, 2020.
At the mitigation hearing on Thursday, Lai’s lawyer Derek Chan said his client’s offence could not be described as complex or meticulous since the company registration for Dico clearly listed Apple Daily’s headquarters as its address.
Dico’s rental payments to Apple Daily were also openly disclosed, the barrister said, adding that Lai “acted for convenience only, and wasn’t motivated by financial interests.”
According to a surveyor’s report previously submitted by the prosecution, Dico would have had to pay rent totalling between HK$3.4-4.4 million between 1998 and 2020 if it had been sited outside the newspaper’s complex.
Derek Chan said this amount was “very small” compared with the scale of Next Digital’s business, which had been “in thousands of millions.”
The barrister said Dico had only occupied around 0.16 per cent of the premises’ total area. “Even though Apple Daily Printing Limited breached the lease terms, the primary use [of the premises] was still publishing and printing. In general, it was still abiding to the policy of the lot – to develop local industries.”
The lawyer added that Lai or other staff at Apple Daily might not have realised that they were committing a criminal offence when allowing Dico to operate at the office complex.
‘Rags-to-rich’
Derek Chan also asked the judge to take into consideration his client’s advanced age, his primary school level of education, and his hard work in becoming a “rags-to-rich” entrepreneur.
After Lai moved from Guangdong to Hong Kong in the 1960s, he worked in a glove factory until starting his own garment company Giordano and building it into an internationally-recognised brand.
Lai sold his shares and turned to the media industry in the 1990s. Apple Daily, which was founded in 1995, gradually grew to become Hong Kong’s most popular newspaper.
“Despite the controversies in recent years, since 1995 Apple Daily had been an important contributor to Hong Kong’s media history and development,” Lai’s lawyer said, citing the publication’s industry-leading approach to using animations to help report the news.
The court is scheduled to pass sentence on December 10.
Outside the District Court on Thursday morning, a protester known as Grandma Wong waved the UK national flag with a sign that read “Release all political prisoners immediately.”
She also entered the courtroom and told the defendant “Keep it up, Mr Lai!”
Apple Daily folded in June 2021 after Lai and several other members of the publication and of parent firm Next Digital were charged under Beijing’s sweeping national security legislation. Six former senior staffers of the paper, who are also Lai’s co-defendants in the national security case, pleaded guilty on Tuesday to conspiracy to commit collusion.
Lai himself has been in custody since December 2020. He is serving prison terms for protest-related offences.
Two years of ‘suffering’
Meanwhile, Wong Wai-keung’s counsel Maggie Wong asked the court to hand down a suspended sentence in light of her client’s lesser role in the case as well as his health and mental conditions.
The lawyer said Wong Wai-keung was not the mastermind, as he had no power over Next Digital’s decision-making, financial affairs or management, adding that there was no proof that he had gained any personal benefits either.
In addition, Maggie Wong said her client had “suffered greatly” during these two years following his arrest, as the 61-year-old had experienced serious hearing loss and developed heart diseases in the period. His wife was also hospitalised due to serious illnesses.
The counsel said her client was unable to cope with the above issues as well as the stress introduced by this fraud case, and was thus diagnosed with major depressive disorder. Citing the defendant’s psychologist, the barrister said her client’s mental condition will further deteriorate if he is sentenced to imprisonment.
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