Suppliers and customers of furniture and home appliance retailer DSC, which closed shop on Monday, have very slim chances of getting back their money because they are classified as unsecured creditors, lawyers have warned.
Police, customs and labor authorities are looking into allegations of unpaid wages, undelivered goods and other unsettled obligations against the company, Ming Pao Daily reported on Wednesday.
The company has cited financial difficulties for its decision to close all of its outlets.
More than 400 DSC employees have yet to receive their salaries for July. Around 200 of them attended a meeting with representatives of the Labor Department.
Legislator Chan Yuen-han called on the Labor Department to launch a criminal investigation.
So far, the Labor Department has received over 300 applications for assistance relating to unpaid wages from DSC staff, and is trying to get in touch with DSC management to set up a meeting.
Consumer Council chief executive Gilly Wong Fung-han said his office is also trying to reach the DSC management after receiving at least 820 inquiries and 182 complaints, mostly relating to goods undelivered after payment was made.
Barrister Albert Luk said in the event of a liquidation, employees are on top of the list of those who will receive compensation, followed by secured creditors such as banks and financial companies, and unsecured creditors like suppliers and customers.
Meanwhile, Sing Tao Daily reported that DSC boss Hui Ming-shun has moved out of its home on La Salle Road in Kowloon Tong. It also said one of his two flats was sold for HK$31.8 million in mid-July.
Hui was once considered a legend in the retail sector, having developed his furniture and home appliance empire from humble beginnings.
Hui, along with his wife, started his direct sale company in an upstairs unit in Mong Kok in 1997 with an initial capital of HK$100,000.
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