HKSAR v. Wong Kam Kong

DCCC 914/2017

[2018] HKDC 709

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 914 OF 2017

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Reasons for Sentence

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Charge and facts

1.The Defendant pleads guilty to a charge of fraud.  The charge alleges that between 6/3/2002 and 5/8/2013 he persistently falsely represented to officers of the Social Welfare Department that all the information given in the Review Forms of Comprehensive Social Security Assistance Scheme was true and a complete and accurate statement of his circumstances in that he falsely represented that he had no assets of his family members other than those reported in the aforesaid forms, and with intent to defraud, induced officers of the Social Welfare Department to grant or continue to overpay him in the total sum of $626,856.26 as Comprehensive Social Security Assistance, which resulted in benefit to himself and in prejudice to the Government of HKSAR. 

2.On 9/10/2001, the Defendant’s family, ie his parents, elder sister and himself, applied for Comprehensive Social Security Assistance (“CSSA”) on the ground of ill-health family.  He was the one who signed on the declaration form for the disclosure of all assets to the Social Welfare Department (“SWD”).  The purpose of the said declaration form was to examine the eligibility of the applicants. 

3.Between 6/3/2002 and 5/8/2013, SWD staff had conducted 20 interviews, on roughly half-yearly basis, with the Defendant to update the eligibility of his family.  On each occasion, he had signed the CSSA Review Form to confirm that the declared contents were true and complete and to undertake to report any change in his family’s financial circumstances, whether permanent or temporary, to SWD immediately. 

4.On those said occasions, he had never disclosed the family’s ownership of a property, ie 7^th Floor, no. 403 Un Chau Street, Cheung Sha Wan, Kowloon (“Property”).  According to the Land Registry records, his parents acquired the Property on 16/5/1988.  On 5/11/1999, he and his elder sister were added as the owners.  In other words, the Property was to become jointly owned by his parents, elder sister, and himself.  The estimated market values of the Property were $850,000 and $4,200,000 in 2001 and 2013 respectively. 

5.After taking into account the Property, SWD confirmed that an overpayment of $656,856.26 had been made to his family between 9/10/2001 and 30/11/2013. 

6.On 17/6/2017, the Defendant was arrested by the police. He admitted the offence under caution.  He said he began to go to the Property to collect rent after the death of his father in 2004. 

7.When he was told by SWD that his family was not eligible for CSSA due to the ownership of the Property, he sold the Property and repaid SWD.  

Mitigation

8.The Defendant is 49 years old.  He has a clear record. His counsel Ms Wu informs me that since birth, he has been suffering from hydrocephalus, which substantially reduces his working capacity and job opportunities.  Despite that, he did not apply for disability allowance from SWD.  He worked for some years as a factory worker until 1999 when he was laid off with a severance pay of $30,000.  In 1999, his father was in terminal illness.  He told him of the Property and added him and his sister as co-owners.  He began to collect rent and see to the maintenance of the Property.  He did not make much note of it as he himself had to undergo various operations. 

9.His elder sister is a cleaner working on shift.  He looks after their mother, who is blind.  If he has to go to jail, she will quit her job to look after her. 

10.There are 2 mitigating letters from an ailing couple who live nearby.  They regularly depend on the Defendant to take them to see the doctor or handle chores. 

11.Ms. Wu seeks to suggest that there are exceptional circumstances to suspend his sentence.  First, his personal and family circumstances are pitiable.  Much as I sympathise with him, his fraud was planned from the beginning of his application for CSSA where such circumstances were in his contemplation.  He surely anticipated that it could only make matters worse if he were to be convicted and jailed.  Second, he had fully repaid before he was arrested by the police.  He sold the Property to make a speedy full repayment, suffering a loss of at least $200,000 below market value.  While I agree that this is a strong mitigating factor, this does not qualify as an exceptional circumstance.   

Sentencing considerations

12.In Secretary for Justice v Leung Wai-kei [2007] 2 HKLRD 89, Cheung JA has the following observations:

27. We agree that the CSSA Scheme is intended to help those in genuine need of assistance. Our society does not tolerate any act of defrauding public funds by dishonest means. However, we do not endorse the view that an immediate custodial sentence should be imposed on each and every person guilty of defrauding public funds. Each case presents its own facts and each defendant has his own circumstances, and it would go against sentencing principles to lay down a hard-and-fast rule of adopting immediate imprisonment as a starting point. The following factors should be considered in determining whether a severe sentence is to be imposed:

(1) whether the defendant pleaded guilty;

(2) the amount involved and the length of time over which the offence was committed. It should be noted that, even where a huge total amount is involved, this may be an accumulation of small amounts received by the applicant per week/per month;

(3) the circumstances leading to the offence. There is an obvious difference between a legitimate claim which became false due to a change of circumstances and a claim which was false from its inception;

(4) the purpose for which the money has been used: using the money for providing household necessities will more readily attract the court’s sympathy than spending the money on luxuries;

(5) the defendant’s character and previous records;

(6) circumstances specific to the defendant, such as illness, disability, family difficulties, etc; and

(7) whether the defendant has voluntarily repaid, in whole or in part, the amount that has been overpaid to him.

28. We do agree that in appropriate cases, the court is under a duty to impose a deterrent sentence in order to curb the offence.

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47. Where a defendant is convicted after trial and an immediate custodial sentence is warranted, the appropriate terms of imprisonment are in our view as follows:

	Amount involved	Term of immediate imprisonment
(1)	Less than $50,000	Less than 9 months
(2)	$50,000 to $100,000	9 to 15 months
(3)	$100,000 to $200,000	15 to 24 months
(4)	Over $200,000	Over 24 months

Sentencing the Defendant

13.I take 30 months as the starting point.  I give a one-third discount for the timely plea of guilty.  That is 10 months off.  I reduce another 4 months for full compensation.  His taking care of the aged couple is an act of generosity and kind-heartedness which ought to be appreciated.  I take another month off.  The sentence is 15 months.