12 July 2012. Four people were arrested on corruption charges involving abuse of government housing allowances. This included Mak Chai-kwong, a senior minister, who was sworn in only last week in the newly installed CY Leung government. Mak also resigned his post as development minister on Thursday. This comes as a big embarrassment for the new chief executive of Hong Kong, CY Leung, as he began his first term. This is also an embarrassment for the Chinese government which is also facing a series of corruption scandals at high level at a time when it is embarking on a new leadership transition. Leung himself faces corruption allegations over claims that he made false statements about illegal structures in his home. Prior to his arrest, Mak admitted to buying adjacent flats with another official and renting them out to each other and pocketed the government housing allowance. But he also said this breached no rules. Some observers also commented that it was legal to claim housing allowance so long as a civil servant lived in a rented property. Obviously, the regulations governing housing allowance need to be disambiguated to prevent anomalies. Hong Kong’s Independent Commission Against Corruption (ICAC) commenced investigations as soon as it received corruption complaints. It said that a head of a government bureau, an assistant director of a government department and two other persons have been arrested for allegedly abusing the housing allowance. The Department of Justice also issued a statement that it will ensure due and proper processes are observed in the conduct of the case.