The ICAC has arrested 20 people, including a senior executive of a tobacco manufacturer, for allegedly facilitating the smuggling of cigarettes worth $116 million in return for over $11 million in bribes from syndicates.

Also arrested in the operation were two associates of the arrested senior executive, two employees of the tobacco manufacturer, 11 directors and employees of five companies, as well as four other people allegedly involved in the smuggling activities.

The operation started on Monday after information the senior executive may have accepted bribes for allocating preferential sales quota to various syndicates, knowing that the cigarettes would then be smuggled to the Mainland.

The tobacco manufacturer is a wholly-owned subsidiary of a listed company in Hong Kong. The senior executive is suspected to have accepted advantages ranging from $18,000 to $150,000 per container of cigarettes from at least six syndicates. To cover up the scheme, a number of companies were allegedly set up as vehicles to accept the payments.

It is alleged these syndicates offered bribes of $11.4 million to the senior executive through his associates in relation to the sales of 116 containers of cigarettes worth about $116 million. It is also alleged the cigarettes supplied to these syndicates were ultimately smuggled into the Mainland via Southeast Asian countries.

The company is assisting the investigation. The arrestees have been released on ICAC bail, pending further enquiries.