Hong Kong authorities have again hit out at a scandal-ridden Christian charity operating a boarding school, accusing it of harbouring two former leaders wanted for fraud, after discovering the pair still serve as directors of related companies.

The Security Bureau issued a strongly worded statement on Tuesday, a week after the new leadership of the Christian Zheng Sheng Association said it had cut ties with Jacob Lam Hay-sing and Alman Chan Siu-cheuk, who earlier resigned from the board.

Lam was the founder of the charity, while Chan was the principal of its subsidiary boarding school, the Christian Zheng Sheng College, which was established to help teenagers struggling with drug addiction or who were on probation orders.

Police in January issued arrest warrants for the pair, alleging they had stolen HK$50 million (US$6.4 million) in donations raised to support the college’s operations. Both were not in Hong Kong.

After the association’s new board disavowed the fugitives in its previous statement last week, the government said it would consider unfreezing the charity’s bank account if it used its funds solely to resuscitate school operations, which are set to cease next month due to financial problems.

But authorities made a sharp U-turn on Tuesday after officers from the narcotics division met board members and accused them of lying.

Police explain the HK$50 million fraud case at a press briefing in January. Photo: Sam Tsang

“We found their words and actions don’t accord with the facts and there is a reason to believe that their previous claims of cutting ties with the fugitives were not credible,” the government said.

“The board has failed to fulfil its duties and tolerated wrongdoings.”

It added: “The government strongly condemns their misconduct and has completely lost confidence in them.”

According to the Security Bureau, the new board of the charity, chaired by Reverend Lau Man-wo, agreed in its first meeting in mid-April not to pursue the stolen funds transferred overseas by Lam and Chan, despite the financial crisis the school was facing.

The government subsequently urged the board to recover the money, but the charity’s directors again rejected this course of action at a meeting held in the past week.

“This showed that the board had no intention to help teachers and students of the college,” the government said, adding that the association was now under “suspicion of harbouring the fugitives”.

It noted Lam and Chan were still on the board of the school and the charity fund – both subsidiaries of the association – and that the pair were still in control of the organisation’s bank accounts.

The government said the board had “no sense of responsibility” in running the college or resolving the crisis that it is facing.

It added that relevant departments would provide appropriate support to students of the college as enforcement agencies followed up with the case.

In a reply to the Post, board vice-chairman Siu Yu-fat said the charity would respond to the government’s statement but did not specify when.