Newly retired MTR Corporation chairman Frederick Ma Si-hang saw out the end of his tenure at the government-backed railway operator amid allegations of misconduct, following publication of videos, photographs and a news account in the Apple Daily newspaper linking the head of the Hong Kong transit operator to one of the city’s largest casino developers.
Ma Si-hang is alleged by the media outlet to have flown to Italy, Japan and mainland China last year via private jets provided by Lui Che-woo, chairman of K Wah International, a casino and property developer which has been awarded development sites worth an estimated HK$35 billion by the MTR Corporation over the past two years.
The images are the second public scandal in less than twelve months for Ma, who last year tendered his resignation over accusations of a cover-up concerning poor construction work on the HK$97.1 billion ($12.4 billion) Sha Tin-Central link. Ma on Sunday issued a statement denying any improper activity related to the alleged links to K Wah.
As chairman of the MTR Corporation until his retirement on June 30th, Ma had overall responsibility for the corporate governance and practices of the partially-privatised railway operator and landlord, which has since the beginning of 2018 sold by public tender four land sites with an estimated development value of more than HK$73 billion.
All-Expenses-Paid Jaunts to Europe and Japan
The railway boss, who stepped down at the age of 67, is shown in the images visiting tourist spots while flying by private jet on trips said to be bankrolled by Lui.
In one of the photographs Abraham Shek Lai-him, LegCo’s representative for the real estate industry, is pictured on board a private jet allegedly accompanying Ma Si-hang. In others the MTR chairman is seen with young women said to be provided by the casino tycoon for entertainment purposes.
Three further photographs, also reported by Apple Daily to have been taken last year, show the railway boss at dinner parties attended by both the K Wah International chairman and Henderson Land Development founder Lee Shau Kee.
Dinner Buddies Win Lucrative Land Auctions
The allegations raise questions about potential links between Ma’s relationship with K Wah International’s chairman and the developer’s successful acquisition of land parcels worth an estimated HK$35 billion from the government controlled corporation over the past two years.
In the most recent of K Wah’s more than two million square feet of acquisitions from the MTR, the developer just two months ago was part of a consortium that won the latest phase of the much-coveted Lohas Park development for HK$3.05 billion. The acquisition by public tender gave the developer and its partners the rights to a site expected to yield up to 950,000 square feet (88,258 square metres) of housing at an estimated project value of at least HK$16 billion.
In May 2017 the railway operator also awarded a site to a consortium that included K Wah International, with the consortium making an upfront lump sum payment of HK$8.33 billion for the development rights to a 1.24 million square feet residential project at West Rail’s Kam Sheung Road station in Yuen Long.
At a sale price for finished homes projected at the time of the site acquisition at HK$16,000 per square foot, the Yuen Long project is valued at over HK$19 billion, with K Wah owning a 33 percent stake in the development, according to its most recent annual report.
MTR Boss Says He’s in the Clear
In response to the allegations, Ma issued a statement on June 30th saying that the photographs were taken between 2013 and 2014, before he became chairman of the MTR Corporation, and that the private jets in question were not provided by Lui Che-woo.
The MTR Corporation had earlier defended Ma’s conduct on the grounds that the MTR chairman is the head of a public corporation and thus is not subject to the same rules of conduct as a public official. The MTR, which is listed on the Hong Kong exchange, is 75 percent owned by the Hong Kong government, according to the transit operator’s investor information package.
According to the MTR Corporation, Mas always reported any conflicts of interest, in accordance with the rules of a listed company.
The MTR Corporation, which was a state-owned entity until being partially privatised in 2000, purchases land from the government to develop and operate Hong Kong’s light railway network.
The company typically funds its projects by auctioning off to developers the right to develop sites around MTR stations through joint ventures, with the rail operator’s resulting HK$180 billion in assets making it one of the city’s biggest landlords with assets of over HK$180 billion.