HKSAR v. Nguyen Thi-hanh and Another

DCCC 358/2016

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 358 OF 2016

____________

____________

REASONS FOR SENTENCE

D1 and D2 are jointly charged with 1 offence of "Conspiracy to defraud" (Charge 1) and 1 offence of "Conspiracy to commit money laundering" (Charge 3). D1 also faces 1 charge of "Possession of forged identity cards" (Charge 2), an alternative to Charge 1.

2.D1 pleaded not guilty to Charge 1 but guilty to Charge 2; whereas D2 pleaded not guilty to Charge 1.  D1 and D2 both pleaded guilty to Charge 3.  The prosecution accepted D1's guilty plea to Charge 2. Regarding Charge 1 against D2, the prosecution applied to leave the charge in the court file; not to be proceeded against him without leave of court.  I granted the application.

Summary of Facts

3.D1 and D2 got married in 1996 and had a divorce in 2002.  Their child was born in 1998.  D2 later remarried.

4.D1, D2, D2's 2^nd wife and their respective children resided together at the Ground Floor of a village house in Lam Tei Village, Tuen Mun ("Flat 1"), the registered owner of which is D2.

5.On 13 January 2015, Immigration officers searched Flat 1 in the presence of D2.  D1 returned home later on when the officers were still at the premises.  The following items were seized from various locations in the living room of Flat 1 :-

(i) 10 travel bags/suitcases containing male and female clothing of various sizes;

(ii) documents in respect of 2 bank accounts (namely Hang Seng Bank Account No.765-098769-668 and Bank of China Account No.012-661-1-060733-8), both of which were held in D2's name;

(iii) a green notebook containing information in relation to the status of immigration applications and/or asylum status in Hong Kong; and

(iv) a Vietnamese passport; 42 passport size photos of about 20 persons; a Vietnamese driving licence and 2 Vietnamese Identity Cards.

Charge 2 (against D1)

6.Immigration officers also found 6 forged Hong Kong Identity Cards in D1's bedroom.

Charge 3 (against D1 and D2)

7.The Bank of China account (the "BOC Account") was opened by D2 on 12 October 2007.  Bank records revealed that in 2013, the account received deposits in a total sum of $1,820,045; and $2,976,443 in 2014.  Most of the deposits were made at ATMs.  During the offence period[1], withdrawals in a total sum of $3,260,672.87 were made from the BOC Account.  Most of the withdrawals are untraceable, except 4.  Out of that 4 traceable withdrawals, 3 were related to the purchase of the 1^st Floor of a village house in To Yuen Wai, Tuen Mun ("Flat 2"), which involved a total sum of $2,107,966.23. The 4^th traceable withdrawal was a cashier order in the sum of $800,000 payable to D2.

8.The Hang Seng Bank account (the "Hang Seng Account") was opened by D2 on 15 October 2013.  Bank records revealed that in the last 3 months of 2013, the account received deposits in a total sum of $100,000; and $1,410,654 in 2014.  Most of the deposits were made at ATMs.  During the offence period, withdrawals in a total sum of $755,833 were made from the Hang Seng Account.  None of the withdrawals are traceable.

Summaries of Interviews

9.D1 claimed that she relies on $10,000 social welfare each month.  She resides at Flat 1 as a tenant and pays rent to D2. She admitted occupying the bedroom from where the forged Hong Kong Identity Cards were seized, but denied knowledge of their nature.  She believed they were left behind by her friends.  She admitted having used the BOC Account to remit money to Vietnam on behalf of her friends.  She asked D2 to open the Hang Seng Account for her.  She had also used the Hang Seng Account to remit money to Vietnam on behalf of her friends.  She admitted being the real owner of Flat 2.  She claimed she purchased Flat 2 in D2's name because she was a welfare recipient.

10.By her guilty pleas, D1 now admits that she was in possession of the 6 forged Hong Kong Identity Cards (including having knowledge of their falsity).  She also admits now knowing the nature of the funds in both bank accounts being proceeds of an indictable offence; and having dealt with them together with D2.

11.D2 admitted that the BOC Account was opened by him but was only used by D1.  He was aware of the huge turnover in the account in 2013.  He also admitted opening the Hang Seng Account but claimed that it belonged to D1.  He had withdrawn large sums from the account on behalf of D1 for remitting money to Vietnam.  He believed the money in both accounts were funds deriving from assisting illegal Vietnamese immigrants.  He admitted that Flat 2 was registered in his name, but D1 was the real owner.  He admitted having withdrawn money from the bank to purchase Flat 2.  By his admissions under caution, D2 admitted that he knew or believed that he was dealing with proceeds of an indictable offence.

Mitigation

12.D1 is 44 and has 1 conviction record of "Theft" dated 2002.  Defence counsel Mr. Egan informed me that D1's mother resides in Vietnam.  A Vietnamese lady looks after D1's mother and pays for her expenses.  D1 therefore assisted that woman to transmit funds from Hong Kong.  Mr. Egan submitted that although D1 admits that she is the beneficial owner of Flat 2, she is a de facto trustee for that woman in Vietnam.

13.D2 is 57 and has 1 conviction of "Gambling" dated 2004.  Mr. Egan informed me that D2 has been a worker at the container terminal in Kwai Chung for 18 years.  He and D1 have a son (aged 18) during their marriage.  D1 also has 2 children (aged 11 and 4) with another man.  For reasons unknown, all 6 of them lived under the same roof at Flat 1 at the material time.

14.In mitigation, Mr. Egan submitted that the trial of this case is fixed for 10 days.  By pleading guilty to the respective charges, D1 and D2 have saved a considerable amount of court time.  Mr. Egan informed me that the trial date was fixed in June (i.e. before the Court of Appeal's decision in HKSAR v Ngo Van Nam [2016] 5 HKLRD 1), D1 and D2 are still entitled to the full one-third discount.

15.Mr. Egan also submitted that D2 is a traditional New Territories villager and has been living at Flat 1 for a long time.  He is a responsible father and husband.  D1 was the primary mover in this case.  D2 did not exactly know about the money transactions in Vietnam.  He played a passive role by letting D1 use his bank accounts and did nothing about it.  Mr. Egan explained that when D2 said under caution he "believed the money in both accounts were funds deriving from assisting illegal Vietnamese immigrants", he meant he realized it to be so by a process of rationalization.  Mr. Egan further submitted that based on its opening date, the BOC Account was not set up to facilitate money laundering.

Sentence Charge 2

16.The purpose of D1's possessing 6 forged Hong Kong Identity Cards which bear 4 different names and 5 different photos is blatantly clear. Although she made no direct admissions, there is cogent evidence before me to support an irresistible inference that those forged ID cards are to facilitate illegal immigrants remaining in Hong Kong or to fulfil other related illegal purposes. I accept that D1 was in mere possession of them and did not actually use or produce any of them[2]. On the other hand, the number of forged ID cards involved can be an aggravating factor. In my view, even mere possession of 6 forged ID cards with clear illegal purpose(s) warrants a sentence of 15 months' imprisonment after plea[3]. I sentence D1 to 15 months' imprisonment for Charge 2. Charge 3

17.The Court of Appeal in SJ v WAN Kwok Keung [2012] 1 HKLRD 201 held:

"Money laundering" is a serious offence for not only does it encourage criminal activities indirectly, but also attempt to legitimize the proceeds of crime. In order to crack down on serious crimes, to prevent offenders from getting financial gains, it is necessary to deter the commission of the "money laundering" offences.

Generally, the sentence for "money laundering" offences should mainly reflect the amount of "black money" laundered and not the benefit obtained by the defendant or others. The reason being that it is very difficult to prove the benefit concerned, and in most "money laundering" cases, there may not be evidence to show from what indictable offence the "black money" are in fact derived. Of course, if there is information to prove that the "black money" is originated from serious crimes, including drug trafficking, kidnap and blackmail, illegal human trafficking, other organized crimes, etc. or the defendant's benefit is huge, then the sentence should be adjusted upward.[4]

18.In determining the proper starting point, I have reminded myself of the sentencing principles laid down in HKSAR v HSU Yu Yi [2010] 5 HKLRD 545 and HKSAR v Boma Amaso [2012] 2 HKLRD 33. I have also borne in mind the amount of money involved, the duration of the offence, the defendants' roles in relation to the movements of funds as well as their personal circumstances.

19.In SJ v NGAI Fung Sin Apple [2013] 5 HKLRD 104, Yeung V-P held :-

Generally speaking, the sentence passed in a "money laundering" case is primarily to reflect the amount of the "illicit/black money" involved. Neither the fact that the "illicit/black money"was actually not derived from an indictable offence nor the defendant's ignorance of the actual source of the "illicit/black money" is necessarily a valid mitigating factor…[5]

20.By remitting the proceeds of immigration-related offence(s) to Vietnam or elsewhere, both defendants played a pivotal role in allowing the mastermind(s) of the syndicate access to the illegal funds without setting foot in Hong Kong. Without them, the culprit(s) behind would not have been able to receive a cent sitting comfortably outside Hong Kong.

21.Charge 3 involves using 2 bank accounts to deal with roughly $4 million over a period of 17 months. Some international element was involved too. For D1, I adopt a starting point of 3.5 years' imprisonment[6]. With the guilty plea, the sentence is reduced to 28 months. I sentence D1 to 28 months' imprisonment for this charge. For D2, I adopt at starting point of 3 years' imprisonment based on his relatively passive role. With the guilty plea, the sentence is reduced to 2 years. I sentence D2 to 2 years' imprisonment for this charge.

22.Bearing in mind the totality principle, for D1, I consider a global starting point of 4 years' imprisonment to be appropriate. A one-third discount is given for the guilty pleas, reducing the overall sentence to 32 months. To achieve this result, I order 4 months in Charge 2 to run consecutive to Charge 3. Thus, arriving at a total prison term of 32 months.