A former solicitor has been jailed five years for his role in a scam to defraud an investment company of $5 million.

Peter Chan, 56, was found guilty of one count of conspiracy to defraud. In sentencing, the judge said today that a deterrent sentence must be imposed for the serious breach of trust.

The court heard Mart Treasure Investment Limited was an investment company involved in the development of small houses in Tsam Chuk Wan, Sai Kung. Chan was its legal adviser.

In May 1997, Chan, through a middleman, found Paron Investment Limited, which agreed to purchase the project at $13.2 million.

At a meeting held between shareholders and directors of Mart Treasure, Chan and Dai Shu-sing, one of Mart Treasure's shareholders, falsely represented that Paron had offered to purchase the project at $8.2 million, and persuaded other shareholders to sell the project at that price.

In September 1997, Chan prepared a provisional sales and purchase agreement at $13.2 million, which was signed by Dai on behalf of Mart Treasure. Chan received from Paron two instalments of $3.5 million and $4.9 million respectively for the project.

Chan subsequently transferred $4.3 million to Mart Treasure as partial payment of the sale. He pocketed $1.14 million out of the remaining sum of $4.1 million.