May 2, 2012 / 3:27 AM / in 6 years

Sun Hung Kai's Walter Kwok says brothers hired Hui

HONG KONG (Reuters) - Walter Kwok, the eldest brother of the family that runs Sun Hung Kai Properties (0016.HK), on Wednesday moved to distance himself from Rafael Hui, the former Hong Kong official arrested in connection with a bribery probe involving Kwok’s younger brothers.

The three brothers (L-R) Raymond Kwok, vice chairman and managing director, Walter Kwok, chairman and chief executive, and Thomas Kwok, vice chairman and managing director, of Sun Hung Kai Properties smile during a news conference in Hong Kong in this March 7, 2007 file photo. REUTERS/Bobby Yip/Files

Kwok, ousted from the company’s top spot in 2008, said in a statement provided to Reuters that he was not involved in the hiring of Hui, who was Hong Kong’s No. 2 official from 2005 to 2007. Raymond and Thomas Kwok — joint chairmen of Sun Hung Kai — were arrested on March 29, along with Hui, by Hong Kong’s anti-graft agency.

“Hui was employed by my two brothers and he was not a consultant to me or my mother,” Kwok said in a statement issued through a spokeswoman.

Kwok also moved to address a lingering issue involving his ownership stake in Sun Hung Kai, the Hong Kong-based conglomerate started by his father that has a market worth of more than $31.6 billion as of Wednesday.

Kwok said in the statement that he has a document showing that he is entitled to a one-third stake in the trust that controls Sun Hung Kai Properties. Kwok was removed from the trust, which owns 42 percent of the company, in 2010.

Kwok claims he is authorized to view the structure of the trust after winning arbitration in Switzerland but that his family is blocking him from accessing the documents by saying he is using outdated paperwork.

“I want to clarify that the legal document has no expiry date at all,” Kwok said in the statement. “According to my legal adviser it remains valid.”

Kwok’s ownership stake in the company gained fresh attention in March with the arrest of his brothers and Hui.

Hong Kong’s anti-graft body, the Independent Commission Against Corruption (ICAC), arrested Raymond and Thomas Kwok on March 29, along with Hui, a close family friend and adviser to the company.

Part of the bribery investigation focuses on payments from Sun Hung Kai-linked entities totaling more than $2.5 million to Hui before and after his time as the city’s No. 2 government official, according to a Reuters report last month.

Raymond and Thomas Kwok have denied any wrongdoing. Hui has not responded to attempts to reach him for comment.

Walter Kwok, who was not arrested, has denied that he is involved in the bribery investigation.

“As a matter of fact, I am not involved,” he said in a South China Morning Post article on Wednesday, when asked why he was not investigated by the ICAC.

Walter Kwok was chairman of Sun Hung Kai at the time Hui was advising the property developer, but told the Post that he did not know what Hui’s job was.

“He did not have an office in Sun Hung Kai Centre,” the newspaper quoted him as saying. “He was not an executive staff <of Sun Hung Kai properties>. I really have no idea what he was doing.”

Hui became a non-executive director of Kowloon Motor Bus in 2004, a company majority owned by Sun Hung Kai. While that is the only official role Hui has played at Sun Hung Kai, sources familiar with the matter say Hui has been a long time adviser and consultant to Thomas and Raymond Kwok over decades.

Sun Hung Kai said on March 20 that Thomas Chan, the executive in charge of land purchases for the developer, had been arrested by the ICAC.

The ICAC has declined to comment while the probe continues.

Shares of Sun Hung Kai ended the morning session up 0.6 percent on Wednesday in Hong Kong, lagging a 1.3 percent gain in the benchmark Hang Seng index .HSI. The stock has lost 15 percent since the arrests of Thomas and Raymond Kwok.

Walter Kwok said he would entertain a return to the company if invited by the board of directors. “I will consider,” he said, according to the newspaper.

The eldest brother remains a non-executive director of the company, but according to its website, he did not attend any of the four board meetings held during the last financial year.

Sun Hung Kai declined to comment on Wednesday.

    Additional reporting by Sisi Tang and James Pomfret; Editing by Ryan Woo, Michael Flaherty and Richard Pullin

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