HONG KONG: Chief Executive Donald Tsang yesterday launched a counter-attack against his critics who have accused him of carrying out official acts favoring members of his family. Tsang called the allegations malicious rumors and willful distortions.

Speaking to the media for the first time since his return from a four-day vacation, Tsang said he felt it necessary to respond to reports that cast aspersions on his honesty and ethics.

In the latest attack, Tsang was accused of intervening to have a lawmaker assist the chief executive's sister-in-law to secure an early compensation deal for funds lost in the Lehman mini-bonds fiasco.

Tsang also referred to claims he had transferred interests to his son's father-in-law in connection with his energy-conservation policy to subsidize the purchase of electricity-saving light bulbs.

"These claims are fictitious and malicious slanders. In recent days, such behavior has escalated ... The wild accusations are groundless and aimed at damaging people's trust for the Special Administration Region government. As head of the government, I express my deep regrets," he read a statement to reporters after attending an Executive Council meeting yesterday morning.

After delivering his policy address on October 14, Tsang first ran into controversy over his plan to distribute HK$100 cash coupons to each household toward the purchase of energy-saving light bulbs. Anthony Mok, the father-in-law of Tsang's eldest son, is a director of Supermoon Limited, part owner of the Electric Fever Company, a dealer of Philips lighting products in Hong Kong.

In yesterday's response, Tsang again stressed the cash coupon program is redeemable at all businesses and based on the public interest.

"Calling this open, transparent policy a transfer of interests is very unfair to my colleagues who have been consistently promoting the program," he said.

Over the weekend, Lam Suk-jing, the wife of Tsang's brother Norman Tsang Yam-huen, was reported to have recovered 60 percent of her investment in Lehman mini-bonds in April, six months ahead of most mini-bonds investors. The report triggered a protest by 50 mini-bonds investors yesterday.

As to those charges, Tsang said he was unaware his sister-in-law had sought compensation and had never attempted to influence the outcome.

"The voluntary settlement deals between banks and individual investors are reached by the two sides. The government has never stepped in," he said.

He criticized "a few newspapers and magazines" for carrying out a smear campaign against him.

He brushed off a reporter's remark that his popularity has sunk lower than his predecessor Tung Chee-hwa, saying he respects people's decision and poll results.

The government will reflect upon its performance and make improvements when possible. But "we have to speak out about some policies and facts in a fair and open way," Tsang said.

Tsang's response yesterday earned both sympathy and censure.

Cheng Yiu-tong, a member of the Executive Council and chairman of the Hong Kong Federation of Trade Unions, said, as he approved of Tsang's response, "in society ruled by law, certain things can not be tolerated. It's time to take action when some behavior crosses the line."

Francis Lee, an associate professor of Chinese University of Hong Kong's School of Journalism and Communication, also found certain media practices questionable.

Some newspapers ran screamer headlines denouncing Tsang on the front page but provided little analysis. "It gives the impression of 'jumping to a conclusion'," Lee said.

But legislators of the opposition camp yesterday frowned on Tsang's complaint against news organizations. Lee Wing-tat, of the Democratic Party, said Tsang should offer more explanations for the incidents rather than blaming the media.

(HK Edition 10/28/2009 page1)