Monday 2nd July 2018

Dear Reader,

Happy 21st anniversary of the beginning of the (first) Asian Financial Crisis.

NEW ARTICLE
HK Government invasion of the housing market
HK Chief Executive Carrie Lam has ended her first year with a new set of interventions, building on the crumbling foundations of her predecessors. It's time for a major policy rethink. A government's role is to ensure that people have a home, not that they own one. And the government doesn't need to own homes either. (2-Jul-2018)

RECENTLY ON WEBB-SITE
Why HK has no retail bond market
The HK Government's Pilot Bond Grant Scheme is needless corporate welfare and deflects from the real problem: by protecting bank profits from competition for funding and effectively excluding retail investors, the Government and HKMA are preventing a liquid, exchange-traded bond market from emerging. We explain what they need to do instead. (13-May-2018)

Justice is blind, except for haircuts
The Court of Appeal rules that a prison order requiring men to have short hair and allowing women to choose is not discriminatory, because of societal norms for haircuts. We find substantial flaws in this reasoning. We also find that the UK rule which HK inherited was amended by 1999 to remove the discrimination, something that Long Hair's lawyers appear to have overlooked. (1-May-2018)

IN OTHER NEWS
SFC takes former CEO and Chairman of China Forestry (delisted) to Market Misconduct Tribunal
SFC, 28-Jun-2018

HKICPA fines Baker Tilly and Mr Au Yiu Kwan over 2006 Egana auditOur article, 26-Jul-2007
HKICPA, 27-Jun-2018
At last, 11 years after Webb-site blew the whistle on the Egana fraud in our article of 26-Jul-2007, Baker Tilly and its former director get a slap on the wrist and fines of HK$250k and HK$100k respectively for their duff audit. BT even tries to claim that it wasn't responsible for its directors' failings. The audit fee for that year alone was HK$1.47m, far more than the fines. Egana had a market value of HK$7.76bn (US$1bn) on the day of our article, all of which was lost in the collapse.

Disciplinary action against Louis Tang Wai Hung, Cliff Chow Chi Kit and their firm
HKICPA, 25-Jun-2018
For bad audit work on the 2012 accounts of China Technology Solar Power (8111), formerly Soluteck. Mr Tang is fined HK$100k and banned for 2 years. Mr Chow is fined HK$75k and banned for 18 months. W.H. Tang & Partners CPA Ltd is fined HK$150k.

Webb on "Backchat" re white elephants
RTHK, 23-Jun-2018

And much more besides...
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David M. Webb
Editor, Webb-site.com