Not long after BVWire left the offices of the valuation firm Roma Group, anti-corruption forces of the Hong Kong government raided the place, and the CEO was arrested. The next day, the executive director at asset appraisal and advisory firm GreaterChina Professional Services Ltd. was also arrested—part of a probe by Hong Kong’s Independent Commission Against Corruption (ICAC). The two firms are connected—they are joint shareholders in asset valuation firm Greater China Appraisal Ltd.
Kelvin Luk, chairman and CEO of Roma Group, was arrested for his “alleged personal involvement in a transaction of one of the clients of the Group,” according to a company statement referred to in a report in Reuters. Luk has resigned from Roma. No details were given on the arrest of David Yip, executive director at GreaterChina Professional Services Ltd., according to a report in Bloomberg. Yip is also chairman of a Hong Kong-based company that said it had a deal to buy the English Premier League soccer team Hull City. Luk told Bloomberg that his arrest was related to a personal matter and was not connected to Greater China Appraisal.
The Wild East: In our prior coverage of the business valuation profession in Hong Kong, we reported on the concern over the quality of valuation work there and noted that there is no formal oversight of the profession. If these recent arrests are related to valuation practice, they may trigger a crackdown from regulators to pressure the local profession to get its house in order.
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