Two shareholders and an assistant contract manager of a company have been jailed three years by the District Court for conspiracy to defraud the Judiciary of a $61-million digital audio recording and transcription services contract.

Lui Mei-chi, 42, shareholder-cum-director and contract manager of Megaluck International; Lui Mei-chong, 41, Megaluck shareholder-cum-director; and Lui Yuen-fai, 37, Megaluck assistant contract manager, were earlier found guilty of one count of conspiracy to defraud.

Judge Andrew Chan said custodial sentences were warranted as the fraud involved substantial contract sums and hurt the government tendering system. He said the defendants played equal roles in defrauding the Judiciary through a sophisticated scheme.

The Judiciary invited tenders for the contract on June 4, 2004. The contractor had to provide digital audio recording and transcription services to the Lands Tribunal, the Coroner's Court, the Labour Tribunal, the Obscene Articles Tribunal and the Magistrates' Courts.

Megaluck and other companies submitted tenders to the Judiciary for the contract. Megaluck was awarded the contract on October 28, 2004, by the Judiciary upon the recommendation of its tender assessment panel.

False claims

Subsequent examination revealed that the defendants had conspired together to defraud the Judiciary. They falsely represented to the tender assessment panel that two people were in the employ of Megaluck as a transcription production supervisor and an audio recording supervisor.

They also falsely claimed that Megaluck had installed conference and recording system and provided interpretation and transcription services for an engineering and trading company under a contract of $380,000, and installed another system for a swimming pool services company for a contract sum of $86,000.