HK$85m scam lands boss of collapsed insurance company in jail

[TheZephyrSong]

HK$85m scam lands boss of collapsed insurance company in jail

Secretary of defunct firm also locked up in affair that cost official body HK$862m

PUBLISHED : Saturday, 20 June, 2015, 2:45am
UPDATED : Saturday, 20 June, 2015, 2:45am

Thomas Chan [email protected]

The Anglo Starlite Insurance Company Ltd in Causeway Bay in this file photo. Photo: Felix Wong

The elderly founder of the collapsed Anglo Starlite Insurance was jailed for three years and one month for orchestrating a fraud scheme in the 2000s that caused a statutory body to pay more than HK$800 million to settle claims on its behalf.

Atmaram Parshotamdas Balani, 72, had earlier pleaded guilty to one count of conspiracy to defraud and one of using false instruments.

His secretary Wong Pik-yin, 44, had denied two counts of conspiracy to defraud and was sentenced to one year and three months in prison after trial.

Jailing the pair yesterday, District Court Judge Amanda Woodcock said the Motor Insurers' Bureau paid out about HK$862 million to settle outstanding claims on Anglo Starlite after the firm was liquated in 2009.

"The figure is a vast amount of money," Woodcock said. "[The court] cannot ignore the vast amount of money and liability placed on the [bureau]."

She had previously acquitted two other co-accused after trial.

Earlier, the court heard Balani and Wong faked accounting documents to make it seem as if HK$85 million had been injected into Anglo Starlite, which dealt mainly with motor vehicle insurance, from 2006 to 2009.

The insurer was in fact struggling financially and wanted to hide its problems from the Office of the Commissioner of Insurance. The bogus documents included alleged deposit slips of ICICI Bank, which Balani used in 2009 to pretend Anglo Starlite had met financial requirements from the insurance watchdog.

The offences came to light when the commissioner received complaints that Anglo Starlite did not honour claims although it appeared to be financially stable.

Balani was the instigator of the whole fraud scheme, the court heard, while Wong played an assisting role. Woodcock found Wong had full knowledge of the scam and helped perpetuate it over the years.

But the judge considered the six years prosecutors took to bring them to court after their arrests. She noted Balani's heath had worsened and Wong had got married with two children over those six years. In the light of the circumstances, she reduced each of their terms by nine months.