What is an owners’ corporation in Hong Kong?

An owners’ corporation is a legal body formed by flat owners to manage common areas, collect fees, and handle repairs. It must keep proper books, present audited accounts at the AGM, and follow building by-laws. Many OCs engage licensed property managers to run daily operations and oversee contracts and payments.

How did the Tseung Kwan O embezzlement persist for years?

It likely persisted due to single-person control of payments, weak bank mandates, limited data shared with the committee, and audits that checked year-end summaries instead of bank-sourced records. Strengthening dual authorisation, reconciling monthly, and verifying suppliers directly can disrupt similar property management fraud early.

What insurance can protect OC funds?

Fidelity guarantee insurance covers employee or agent dishonesty, subject to sub-limits, deductibles, and warranties. Insurers may require dual controls, reconciliations, and audits to bind or renew. After the Tseung Kwan O embezzlement, many OCs will seek higher limits and clearer claims procedures, since minimal coverage can leave large funding gaps.

Will management fees or owner levies rise after this case?

Likely yes. Tighter controls take time and money, and fidelity premiums may increase. However, better governance cuts loss risk and can reduce long-term costs. OCs can phase upgrades, tender competitively, and share dashboards with owners to prove value. Clear audit oversight helps keep fee increases reasonable and transparent.

Law and Government

January 03: Tseung Kwan O HK$60m OC Theft; Manager Gets 18 Years

ByDanny Kontos January 3, 2026January 3, 2026

The Tseung Kwan O embezzlement case shows how weak controls can drain an owners’ corporation. A former manager stole over HK$60 million across 10 years and received 18 years in prison. This is a wake-up call for every Hong Kong owners’ corporation. We outline what failed, how property management fraud happens, where audit oversight broke down, and what boards and managers should do now. Expect tighter compliance, higher insurance needs, and possible cost increases for service providers and OCs.