Two former executives of Hong Kong’s Next Digital media group, Mark Clifford and Gordon Crovitz, have filed a legal challenge against global accounting firm BDO, accusing it of collaborating with city authorities to liquidate the company founded by jailed pro-democracy tycoon Jimmy Lai. The court order for the winding-up of Next Digital Limited, the parent company of Apple Daily, was issued in late 2021, following police raids on the newsroom and the freezing of assets.
Allegations Against BDO
Clifford and Crovitz, both ex-directors of Next Digital, lodged a complaint with the British government, claiming that BDO had facilitated human rights abuses by providing essential services to the Hong Kong government. They expressed concerns over the lack of judicial oversight in BDO’s actions, accusing the firm of acting as a quasi-governmental agency at the government’s behest. The executives, who left Hong Kong due to fears of arrest under the national security law, highlighted the role of Clement Chan, managing director for assurance at BDO’s Hong Kong branch, in investigating Next Digital’s financial affairs.
Chan’s Role and Controversy
Clement Chan’s appointment as an inspector of Next Digital drew scrutiny for potential conflicts of interest, as he was also the chair of the city’s Consumer Council. Despite citing “public interest” in ordering the company’s winding-up, Chan defended his role as a personal appointment by the finance chief under the city’s Companies Ordinance. However, Clifford and Crovitz argued that Chan’s actions, along with BDO’s involvement, violated guidelines set by the Organisation for Economic Cooperation and Development, as they failed to abstain from improper political activities.
BDO’s Response and Extension of Chan’s Role
In response to inquiries, a spokesperson for BDO Global cited confidentiality obligations regarding the proceedings in the UK, declining to provide further information. BDO Hong Kong did not offer a comment on the matter. Chan’s appointment as an inspector of Next Digital has been extended multiple times, with the latest six-month extension announced in July. Despite the controversy surrounding his role, Chan has not addressed the allegations raised by Clifford and Crovitz.
Implications and Future Developments
The legal challenge filed by the former executives of Next Digital against BDO sheds light on the complexities of corporate governance and accountability in Hong Kong. The case underscores the challenges faced by media organizations operating in an environment marked by political tensions and regulatory pressures. As the trial of Jimmy Lai continues and the future of Next Digital remains uncertain, the outcome of the legal challenge against BDO could have implications for the broader landscape of media freedom and corporate responsibility in Hong Kong.
In conclusion, the legal dispute between the ex-executives of Next Digital and BDO highlights the intersection of business, politics, and human rights in Hong Kong. The case raises important questions about the role of professional services firms in supporting or undermining democratic values and the rule of law. As the legal proceedings unfold, stakeholders will be closely watching the implications for corporate governance and accountability in the city’s media industry.