HONG KONG - The money-laundering trial against Birmingham City owner Carson Yeung began Friday with allegations of vast sums of money flowing through the businessman's bank accounts despite his then-meagre income as a hairdresser.
Prosecutor John Reading outlined his case as the trial began in earnest. Hong Kong District Court Judge Douglas Yau had dismissed a last-ditch attempt by Yeung — on the initial day of the scheduled hearing — to have the case dismissed on the grounds he would not receive a fair trial.
Yeung has pleaded not guilty to five counts of money laundering involving more than 720 million Hong Kong dollars ($92 million).
The charges involve money deposited into bank accounts from January 2001 to December 2007 — years before he won a takeover battle for English football club Birmingham in October 2009 for 81.5 million pounds (then $130 million).
Reading said that over the seven years, money was deposited into and then withdrawn from five bank accounts held by Yeung and his father, Yeung Chung. He added that Yeung essentially controlled his father's accounts.
The transactions included 437 cash deposits totalling HK$97.5 million ($12.6 million), checks from a Macau casino company and deposits from and withdrawals to stock brokerages.
"Almost all of the cash deposits were made by unknown parties without any apparent reason for such deposits," Reading told the court.
The amount of money involved was more than 300 times the father and son's combined reported income of HK$2.2 million ($278,000) from 1999 to 2006, Reading said. From 1997 to 1999, Yeung earned HK$335,299 ($43,200) from his Kowloon hair salon while his father was a caretaker living in public housing. From 1999 to 2003, neither reported any income. A vegetable stall his father ran for a few years after that made a tiny profit.
Yeung's father was also sought by police on an arrest warrant but he has since died in mainland China, the court was told.
Reading said that when Yeung's company bought 30 per cent of Birmingham City in 2007, about HK$84 million ($11 million) of the HK$237 million price "was paid personally from the bank accounts" to a British law firm. He gave no further details.
Shares of the company, Birmingham International, have been suspended from the Hong Kong stock exchange since Yeung's arrest.
The trial was delayed from its Monday start after Yeung's lawyers applied for a permanent stay of proceedings. But the judge said the defence failed to prove that missing stock brokerage statements and purported abuse of process by police would result in an unfair trial.
Yeung's legal team argued earlier this week that delays by investigators meant they could not obtain older financial statements that could help his defence because they were lost or destroyed.
Yeung's lawyer had argued that because he wasn't arrested until June 2011, brokerage statements for earlier transactions were unavailable because Hong Kong financial institutions have to keep such documents for only the previous seven years.
Birmingham won the 2011 League Cup, ending 48 years without a major trophy, but despite the victory was relegated from the Premier League the same year.
Before his takeover of Birmingham, Yeung was a little-known businessman who reportedly invested in a Macau casino and owned a stake in a Hong Kong newspaper. His only previous experience with professional football consisted of a stint as chairman of Hong Kong Rangers Football Club from 2005-06.
The trial will resume on Tuesday.
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