Thursday 1 October 2009
Ernst & Young’s regional chairman steps down
David Sun Tak-kei, the Hong Kong and China chairman of Ernst & Young has stepped down. It comes a day after the offices of the accounting firm were raided by police on Tuesday in connection with a long-running investigation into the collapse of former client Akai Holdings.
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Ernst & Young’s regional chairman steps down
Naomi Rovnick
30 September 2009
David Sun Tak-kei, the Hong Kong and China chairman of Ernst & Young has stepped down. It comes a day after the offices of the accounting firm were raided by police on Tuesday in connection with a long-running investigation into the collapse of former client Akai Holdings.
An Ernst & Young spokesman on Wednesday denied Sun’s move was related to the Akai case, saying it was normal for the firm to announce appointments and reorganisation on October 1.
The commercial crime bureau launched a fraud investigation into Ernst & Young Hong Kong on Tuesday. It began after Ernst & Young was accused in court of falsifying and doctoring scores of documents it presented to defend itself against a negligence claim by the liquidators for Akai Holdings, which went bust in 2000 with debts of US$1.1 billion – the city’s biggest corporate collapse.
Ernst & Young last week paid hundreds of millions of dollars to settle the civil negligence case.
An Ernst & Young partner, Edmund Dang, who was already suspended by the firm, was arrested at his home on Tuesday on suspicion of forgery but later released on bail without being charged.
Sun, who will remain a partner and keeps his other title of co-managing partner of the firm’s Far East division, was not available for comment. He will be replaced as chairman by Albert Ng.
Sun was a senior staff member on the Akai audit. He was the independent partner in charge of the Akai account from 1991-99.
Lawyers for the liquidators had accused Ernst & Young – one of the world’s Big Four accounting firms, with over 135,000 employees – of failing to spot an alleged theft by Akai’s chairman, James Ting.
When the Court of First Instance began hearing the civil case, the liquidators alleged Ernst & Young staff had tampered with old files from its time as Akai’s auditor and had falsified documents.
The accounting firm had relied on the suspicious documents for its witness statements, court pleadings and expert reports.
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