HKSAR v. Tsui Man Lung

DCCC 517/2017

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 517 OF 2017

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Reasons for Sentence

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Charge

1.The Defendant pleads guilty to a charge of money laundering. 

Facts

2.Maxilite Lighting (“VTC”) was a lighting equipment company based in Vancouver, Canada and had business relationship with a Chinese supplier named SU Yi-cheng (“PW1”) for over 10 years.  VTC knew PW1's bank account details for payment.  VTC and PW1 each used an email address recognizable to the other.  As a matter of practice, PW1 did not have to give the bank account details to VTC when requesting payment.

3.In 12/2014 VTC placed an order with PW1.   On 28/1/2015, VTC received an email from PW1 asking for payment into a new bank account (which transpired to be that of the Defendant).  As a result, VTC made a US$24,000 deposit into the Account.  The scam was unveiled when PW1 called the owner of VTC, Troy NELSON (“PW2”), who asked PW1 about the Account.  PW1 inferred that his email account had been hacked. They reported the case to the police. The Account, together with the US$24,000 deposit from VTC, was thereby frozen.

4.Bank records confirmed that the Account was a personal account opened in the name of the Defendant alone on 25/10/2006.  He stated to be a logistic worker in the account opening mandate.

5.Transaction records of the Account from 21/8/2009 to 16/8/2016 showed that before 1/2015, the turnover of the Account was not substantial.   It maintained a balance from a few Hong Kong dollars to no more than HK$30,000.  In the offence period, there were small sums transferred to the Defendant’s account with the Hong Kong Jockey Club. 

6.Apart from this deposit of US$24,000, namely HK$185,642.51, there were three other deposits of substantial sum from overseas in 1/2015 as follows:

(1) Deposit in the sum of HK$40,068.19 on 14/1/2015, withdrawal of HK$40,000 in cash on 15/1/2015;

(2) Deposit in the sum of HK$ 91,421.30 on 21/1/2015, withdrawal of HK$91,000 in cash on 22/1/2015;

(3) Deposit in the sum of HK$ 92,102.75 on 24/1/2015, withdrawal of HK$91,000 in cash on 26/1/2015.

7.Travel Index check records confirmed that he was in Hong Kong in the course of these three cash withdrawals.

8.The Inland Revenue Department only had records about the Defendant in the form of Employer's Return for the period from 15/6/2015 to 29/10/2015 made by Gammon Construction Limited.  The records showed salary of HK$69,360, leave pay of HK$6,243, gratuities of HK$6,958, and allowances of HK$35,571, namely HK$118,132 in total.

9.On 26/3/2017, the Defendant was arrested by the police. In a video-recorded interview under caution, he stated that he had withdrawn HK$91,000 in cash from the Account.  He had not given the online banking password to other persons.

10.In conclusion, the Defendant between 14/1/2015 and 29/1/2015, knowing or having reasonable grounds to believe that property, namely deposits in the total sum of HK$409,234.75, (consisting of HK$40,068.19 + HK$91,421.30 + HK$92,102.75 + HK$185,642.51) in the Account, in whole or in part directly or indirectly represented the proceeds of an indictable offence, dealt with the such property. 

Mitigation

11.D1 is 35 years of age.  He had several criminal records but none similar to money laundering.  He committed the present offence to earn a reward of HK$500 each time for the 4 substantial sums of remittance.  He received reward for the first to the third remittance only as his friend, who promised him such reward, had disappeared after the Account was frozen. 

12.His family has come to court to show support and put in mitigating letters. 

Sentencing considerations

13.In HKSAR v. BOMA [2012] 2 HKLRD 33, 43, the Court of Appeal has identified the following features relevant in the sentencing of money launderers, which are, apart from the amount of money laundered:

(1) The nature and penalty of the predicate offence;

(2) The nature of knowledge or belief of the predicate offence on the part of the money launderer;

(3) The international element;

(4) The sophistication of the money laundering offence, including the degree of planning or whether deceit is practiced to achieve the money laundering;

(5) The instance of a criminal syndicate;

(6) The number of transactions and the length of time in the money laundering process;

(7) Subsequent knowledge of the predicate offence evolved from a case of reasonable belief;

(8) The role and acts of the money launderer, including his position and reward.

Sentencing this Defendant

14.Applying Boma, there was an international element as the 4 substantial sums had come by way of remittance; he was given a small reward for 3 times while expecting another one; the offence lasted only a fortnight; the overall sum cannot be regarded as very large. 

15.I take a starting point of 2 years.  One-third off for his timely plea of guilty, the sentence is 16 months.