Hong Kong Jockey Club misreports charity donations by HK$20.5bn
A Hong Kong Jockey Club has seriously misreported the amount of money it has donated through its charity arm
An investigation has revealed the Hong Kong’s Jockey Club has misreported the amount of money its charity arm donated by HK$20.5 billion.
A Financial Times analysis examined a government-granted monopoly in the city that generated revenue of nearly HK$34 billion on record betting turnover of more than HK$216 billion. It is justified on the grounds that profits are given to charity.
However, the investigation found that the club has exaggerated its donations and that the payout is only a sliver of the charity funds it promised. It found the charity arm has donated HK$30.5 billion since 1959, not the HK$51 billion it claimed.
“The charities trust is a fig leaf just to justify having the monopoly rather than having competition in that space,” said David Webb, a corporate governance expert and long-time critic of the Hong Kong Jockey Club.
“If they simply paid an extra one per cent of their revenue to the government instead and let the government do it, they wouldn’t have the moral high ground.”
Last year, a press release said its annual results recorded “total charity donations” of HK$7.6 billion but that counted money that had been “allocated” to charitable organisations and community projects, and earmarked for potential payment.
The annual donations, however, were just HK$2 billion, according to the annual report of the Jockey Club Charities Trust. This reveal highlighted the record level of inequality, with one in five people in Hong Kong living below the poverty line.
The club’s Chief Executive, Winfried Engeelbrecht-Bresges, said the club held onto sufficient reserves to honour its commitments and not let donations drop, “even if we would have zero income coming from the club into the trust”.
Corporate filings also revealed 22 per cent of donations over the past decade went to companies controlled by the club.
When asked why the club did not spend more on other causes, Leong Cheung, head of charities arm, said he did not control the target range for annual pledges and it was instead made by tycoon-rich voting members who sign off on donations.
Lam Cheuk-ting, a legislative councillor and former investigator with Hong Kong’s Independent Commission against Corruption, recommended adding an independent representatives from grassroots organisations to the trust’s board and has urged the club to explain why it donated so little of its holdings.
Asked whether it should continue to wield ultimate discretion over how the billions in its charity fund are distributed, he said: “I think it should be open for discussion.”
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