October 17, 2012 / 6:30 AM / in 5 years

Hong Kong's former development secretary charged with fraud

HONG KONG (Reuters) - Hong Kong's anti-graft agency charged a former development secretary over an alleged housing fraud involving HK$700,000 ($90,300) on Wednesday, in the latest blow to the city's new leader who has vowed to restore confidence in the government after a series of scandals.

Mak Chai-kwong, who quit in mid-July barely two weeks after he was appointed, was charged along with Tsang King-man, assistant director of the highways department, over counts of conspiracy to defraud the Hong Kong government between 1985 and 1990, the Independent Commission Against Corruption (ICAC) said.

The two men concealed that they each had a financial interest in the flat they had leased from each other's wives, the anti-graft agency said.

Mak declined to comment after he appeared at the headquarters of the ICAC, local media reported.

The news comes just months after Hong Kong leader Leung Chun-ying was embroiled in a housing scandal involving illegal structures at his HK$500 million ($64 million) home in the exclusive Peak district.

Leung, who took over as leader on July 1, has made affordable housing a priority in a city where many residents need to work their whole life to pay off a mortgage on a small home.

The most prominent of a recent spate of scandals involving top government officials concerns former chief secretary Rafael Hui, who was charged in mid-July for allegedly accepting payments and unsecured loans totalling about HK$34 million from Thomas and Raymond Kwok, the billionaire co-chairmen of Sun Hung Kai Properties (0016.HK).

That case confirmed what many have long suspected were cosy relations between business tycoons and government officials, triggering a wave of public condemnation.

($1 = 7.7512 Hong Kong dollars)

Reporting By Yimou Lee; Editing by Anne Marie Roantree and Jeremy Laurence

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