Enforcement

Parties involved:

Mr X (Employee of company 1)
Mr Y (Scheme member)
Ms Z (Employee of company 2)

Case details

MPFA noticed that Company 1 had posted leaflets on the street publicizing the following: "Good news for unemployed and self-employed persons regarding early withdrawal of your MPF. If you are aged below 65, and wish to withdraw your MPF, our company can help you. No fees will be charged if our attempt is unsuccessful.” The leaflet listed the company’s name and two mobile phone numbers. MPFA was suspicious of the message and therefore started an investigation.

MPFA’s investigation and enforcement actions

MPFA contacted the service providers of the two mobile phone numbers on the leaflet to get information about the registered users. It was found that the two numbers were pre-paid phone card numbers and there was no registered user information.
 
An MPFA inspector disguising as a scheme member called Company 1 and successfully contacted      Mr X. Mr X said that he could help MPF scheme members make an early withdrawal of their MPF within one month. The inspector claimed that he had financial difficulties and needed money for emergency use, and thus asked Mr X for assistance.
 
Mr X told the inspector to prepare the necessary documents, such as his Hong Kong Identity Card, MPF account information and Home Visit Permit as soon as possible. He told the inspector to call him when the documents were ready, and he would accompany the inspector to the District Office to make a declaration.

Also, Mr X told the inspector that he would charge 10% of the total MPF benefits as a service fee for successful withdrawal. He said arrangements would be made for the MPF trustee to send the cheque of the MPF benefits to his pre-arranged address by mail, and then he would contact the inspector to give him the cheque and collect the service fee.
 
Meanwhile, MPFA noticed that there had been a number of scheme members applying for early withdrawal of MPF on grounds of permanent departure from Hong Kong. They had changed their address when submitting their applications, and even more suspicious, more than 20 scheme members had given the same two addresses in Mong Kok and Yuen Long as their last known addresses.

MPFA later found that one of the scheme members was Mr Y, who had applied for early withdrawal of MPF on grounds of permanent departure from Hong Kong. The inspector contacted Mr Y at once and took a statement from him.
 
Mr Y said that a friend had introduced Ms Z of Company 2 to him. Ms Z told Mr Y that she could help him arrange early withdrawal of his MPF on grounds of permanent departure from Hong Kong. She then provided the relevant document for Mr Y to sign, and instructed him to fill in the phone number and address provided by her on the claim document so that the MPF trustee could contact her and send the cheque of the MPF benefits to her by mail.
 
Ms Z also accompanied Mr Y to the District Office to make a declaration of permanent departure from Hong Kong. The inspector found that Ms Z had previously helped other scheme members withdraw their MPF in the same way.
 
Subsequently, MPFA checked with the Immigration Department the entry and exit records of these scheme members and verified the declared departure dates from Hong Kong as stated in the statutory declarations submitted to the MPF trustees. The records revealed that these scheme members had made only short trips between Hong Kong and the Mainland.

The inspector also found that some scheme members were still participating in MPF schemes and made contributions even after they had made the declaration of permanent departure from Hong Kong. This meant that they continued to work in Hong Kong after the date of departure stated in the declaration. Therefore, MPFA had reason to believe that the scheme members had not permanently left Hong Kong.
 
MPFA suspected that the incident involved two illegal syndicates which, for a service fee, assisted or abetted scheme members in making false statements regarding permanent departure from Hong Kong and withdrawing their MPF before reaching the statutory retirement age of 65.
 
After seeking legal advice, MPFA collaborated with the police to investigate and combat the two illegal syndicates. Consequently, more than 20 offenders were prosecuted for making false statements for early withdrawal of MPF on grounds of permanent departure from Hong Kong. They were later convicted and most of them were fined amounts ranging from $1,000 to $6,000 and/or sentenced to 80 to 240 hours of community service.

Understanding the MPFSO

Repeat use of permanent departure from Hong Kong as grounds for early withdrawal is not allowed

According to the MPFSO, scheme members are allowed to withdraw their MPF when they reach the age of 65. Only under specific circumstances, are scheme members allowed to make early withdrawal of their MPF.

Under the law, scheme members who have previously been paid MPF on grounds of permanent departure from Hong Kong cannot apply again with a later departure date. In such case, no MPF will be paid to them by their MPF trustees. If the scheme members return to Hong Kong subsequently and become employed or self-employed, they have to enrol in an MPF scheme again and cannot apply for early withdrawal of MPF again using the same reason.

Legal consequences and penalties

Any person making false or misleading statements in this regard commits an offence. On the first conviction, offenders are liable to a maximum fine of $100,000 and imprisonment for one year. On each subsequent conviction, offenders are liable to a maximum fine of $200,000 and imprisonment for two years.