HKSAR v. Chu Hoi Kan
Read the full judgment text of DCCC 623/2021 on BabelCite. This District Court judgment was delivered on 17 May 2024.
1. The defendant pleaded not guilty to a charge of bookmaking, contrary to s 7(1)(a) of the Gambling Ordinance, Cap 148 (the “Ordinance”).
Cited by 1 case · Cites 3 cases
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DCCC 623/2021 [2024] HKDC 751 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CRIMINAL CASE NO 623 OF 2021 ________________________
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________________________ REASONS FOR VERDICT ________________________ 1.The defendant pleaded not guilty to a charge of bookmaking, contrary to s 7(1)(a) of the Gambling Ordinance, Cap 148 (the “Ordinance”). 2.Particulars of the offence:-
3.The Prosecution case consisted of 3 main witnesses:-
4.The admitted facts include the following information:-
5.The defendant elected not to give evidence. The relevant legal principle 6.Having heard submissions from both parties and have studies the evidence and the relevant cases, I remind myself that it is the duty for the Prosecution to prove its case beyond all reasonable doubt. The defendant has no duty to prove his innocence. This is his right not to call/give evidence. I will not draw any adverse inference against him. 7.According to Li Defan & Anor v HKSAR (2002) 5 HKCFAR 320 that means that there is no evidence from the defendant to undermine, contradict or explain the evidence put before me by the Prosecution. (para 15 of the judgment) 8.As to PW2, he testified under immunity from prosecution. When I assessed the credibility of PW2’s evidence, I bear in mind the factors I must consider included the benefits gained by the witness from the immunity. The reason is that, to avoid being charged by the prosecution, a witness may be motivated to give false testimony so that he will be granted immunity. Furthermore, once a witness is offered immunity and it is accepted, this may become a strong incentive for him to insist on giving certain false, erroneous or misleading evidence because he may risk of losing the immunity if he does not maintain his original version of events to the Prosecution. The Evidence 9.At issue was whether the defendant had engaged in bookmaking. 10.“Bookmaking” is stated in the Ordinance under s 2 as “the soliciting, receiving, negotiating or settling of a bet by way of trade or business whether personally or by letter, telephone, telegram… or by any other means”. 11.“Gambling”, by the same section, is said to include “gaming, betting and bookmaking”. 12.“Gambling establishment” includes “any promise or place… opened, kept or used… for the purposes of or in connexion with unlawful gambling…” 13.S 7(1) of the Ordinance is the offence creating section with which we are concerned with. It reads as follows:-
14.PW3’s report at para 8 under the title of current betting activities involving illegal gambling on horse racing in Hong Kong, he said that:-
15.In the present case :-
16.PW1 said that he called the defendant to place bets and the defendant had accepted all his bets, he never turned down one of his bets. His bets amount within one million would be accepted over the phone immediately. While any bigger bets over 1.5 million, the defendant would call back to PW1 within 10 minutes to confirm that he would accept the bets. 17.PW1 did not know the reason why the defendant had to take time to accept his bigger bets. 18.PW1 also said that at the end of the race days, he would confirm with the defendant as to the total amount of the losses or the winnings. 19.It was not in dispute that PW2 acted according to the instruction of PW1 to settle the debts with the defendant. PW1 would transfer the gambling funds to PW2 to handle the matter. 20.PW1 denied paying any commissions/tips to the defendant for placing the bets. 21.As said in paragraph 9 of the PW3’s expert report that “the taker (illegal bookmaker) or the agent (junket) and the bet-placers generally provide each other with a bank account number for handling of the betting sum, there are also occasions of paying in cash.” 22.PW2 would meet face to face with the defendant to receive cash for the winning sum, PW2 had also issued cheques according to the instruction of the defendant to various accounts, (para 19 of the amended admitted facts refers), 2 were company accounts and 7 were personal accounts. One of them was the defendant’s daughter account. Those cheques amount varied from $200,000, $300,000, $500,000, $800,000, $1.5 million, $1.7 million, $3.9 million, $4.3 million to $5 million. 23.Both PW1 and PW2 said that they did not know the payees of those 9 (2 + 7) accounts holder. 24.PW3, the gambling expert said that, these were proceeds of a crime. Therefore, the banker would find way to receive the money. That means the purpose was to eliminate the traces of the gambling funds and the defendant would not appear to be the recipient of the gambling money. There was no evidence before this court to show the defendant’s bank account have ever received PW1’s bets amount. 25.Just to receive the bets from PW1 would not make the defendant a bookmaker. As said in the judgment of HKSAR v Kam Susanto CACC 542/2003 that:-
26.In the case of HKSAR v Chu Kam Yiu and Others [2002] 5 HKCFAR 591 at p 595 H-I, per Chan PJ:
27.As per Silke NPJ in the same judgment at p 603 B:
28.With those judgments in mind, it is necessary to look at what the defendant said under caution and the Prosecution’s evidence as a whole. 29.The defence said that at the time of the arrest, the defendant was not arrested for the present offence, rather he was arrested for 3 other offences at the time of the arrest:-
30.I first deal with the defence submissions that the defendant was not arrested for the offence of bookmaking, therefore the defence said that what was said under caution could not be used against him. 31.I disagree, at paragraph 56 of the admitted fact it said that the ICAC officer recorded the defendant’s voluntary cautioned statement in the officer’s official notebook and was signed by the defendant. It is produced as exhibit. There is no issue of voluntariness. Further, at the time of arrest, the defendant was aware part of the investigation concerned conspiracy in engaging bookmakinging. 32.What was said under caution by the defendant was admissible and relevant evidence in the present case. There is no reason for me to rule out this piece of evidence. 33.The answers given under caution by the defendant were mixed statements. Therefore, both the inculpatory and exculpatory parts of those statements are evidence for the purpose of determining where the truth lies. It is trite law, however, that the court as the tribunal of fact, is entitled to attach different weight to different parts of the defendant’s statements. 34.From September 2018 to October 2019 – during this period of time, the defendant had consistently receiving bets from PW1 on the racing days. A total of 14 occasions (para 25-45 of the amended admitted facts refers). 35.The defendant said that under caution that “two of them (would) ask me to place bets on horse races, so I placed bets for them on horse races either at the Jockey Club or on the internet. I only earned one point out of that. I did not accept their bets and dared not accept them. I only earned a meal.” 36.We all know that PW1’s bets were massive bets. All over tens of thousands dollars. To place the bets with the Jockey Club have no advantage to the defendant as the Jockey Club only offered 10% discount. The defendant offered 13% discount to PW1 on all his bets. It simply did not make sense that the defendant placed PW1’s bets with Jockey Club. Who would be responsible for the shortfall of the 3% of the losing bets. 37.Further, to place bets with the Jockey Club, the defendant must have sufficient funds to meet PW1’s massive bets as PW1 was not required to provide the gambling funds upfront. 38.Other revenue for the defendant to place PW1’s bets was on the internet. PW3 said that illegal gambling on horse races on the internet has become popular nowadays. 39.The defendant said under caution that it was Lau So Kam helped him to do that as he “did not quite know how to go online”. That website was “AA something”. 40.Both the computer and the notebook were found inside a wardrobe in the master bedroom of the flat. When the ICAC officer found the computer and conducted preliminary examination of the computer, its web browser was displaying a betting website – “web.ctb988.com”. PW3 said that “web.ctb988.com” is an illegal website for gambling, the design of this platform is for people to place bets and to accept bets. 41.According to paragraph 57 of the amended admitted facts, the defendant’s DNA was found on the keyboard of the computer, not that of Lau So Kam, the one that he claimed to assist him to go online to place the bets while Lau So Kam’s DNA was found on the notebook. 42.PW3 also said that there was a connection between the notebook and the computer. He said that in order to use this website, one needs to become a member of it. 43.In paragraph 16 of the report, it said that “the web-attached platform” itself is not involved in the acceptance of bets. It just makes money from the commissions paid by both parties, ie platform service charge. The service charge for “ACCEPT” is generally higher than “BET”. 44.It appears that there are 2 types of memberships. One for “ACCEPT” and one for “BET”. 45.In the notebook, as shown in annex 1 of the expert report, it showed 2 accounts with passwords and verification code:-
46.To log on the account on the website, it is a known fact, a member needs the password to do so. The notebook contained information of the account user number, password, security code and etc. The account user name from the notebook (annex 1) was the same in the computer screenshots from the seized computer. As said before, DNA of Lau So Kam was found on the notebook, however, DNA of the defendant was found on the keyboard of the computer. 47.As such, I attach no weight to what the defendant claimed that it was Lau So Kam who went online to help him to place those bets, I ruled that it was the defendant who used the computer to place bets on the date of the arrest. 48.I also beg a question, at the time of the arrest, which was also a horse racing day, the defendant was presented in the master bedroom while the television was broadcasting live horse racing events in the living room. There were also horse racing magazine and newspapers seized during the operation. If this was just a social gathering, why the computer had to be put away in the wardrobe when the ICAC team arrived? 49.PW3 went on to explain by using annex 3 in his report that there were 5 columns in the red square of the screen shots appeared on the computer from left to right as follows:-
50.PW3 said that “Eat” and “-” signs are indicating factors that the account user on the screenshot was acting as a taker (the illegal bookmaker). 51.In annex 4 of the report, it said that the user of that account had totally accepted $51,043 (the formula is: $10,036 + $6,007 + $10,000 + $10,000 + $15,000 = $51,043). They were all very small bets as compared to PW1’s huge bets. 52.However, all the bet placers lost in the bets, the account user (hh0321a) won a total of $44,701.588 after deducting all the discount from $51,043. That showed the taker and the bettor entered into a betting relationship whereby they took the opposite positions in Race number 9. The taker receiving the bets (吃 – accepted) from the bettors, the opportunity for gain or the risk of loss automatically arose. 53.It is clear to me and I am satisfied beyond all reasonable doubt that the account user as shown in the red box is an illegal bookmaker, in the present case, the only irresistible inference was that it was the defendant as his DNA was found on the keyboard of the computer on the date of his arrest. 54.PW3 said that the taker (illegal bookmaker) generally take records in respect of:-
55.From the computer as shown in the red box (annex 3 of the report), one can see clearly of all the above information except the bet-placer’s name or code. 56.PW1 in his evidence said that at the end of each racing days, the defendant would confirm/summarize with PW1 as to the total amount of his bettings, the winnings and the losses. It follows that the defendant would confirm with his customers as to the total amount of the winnings and the losses on the bets. 57.There must be a way that the defendant knew how to record the name of the bettors. It was just that they were not found in the flat. 58.Inside the flat, there were only 5 persons, 4 were arrested:-
59.Cheng and Poon were the recipients of the gambling funds transferred from PW2 – who was acting on the instruction of the defendant to transfer the gambling debts to the designated account.
60.According to para 25, 36 and 37 of the amended admitted facts:-
61.In March 2019, PW1 only placed bets once on 2 March 2018. Apart from paying the defendant cash of $3,220,000, PW2 also transferred a total of $2 million to various accounts:-
62.It was a huge bet in 2 March 2019. The total lost was over $5 million. 63.Just by looking at the month of March 2019, by any standard, it was a massive amount of money being lost in one racing day. 64.Apart from Cheng and Poon received the betting funds from PW2, two notable facts were that:-
65.The defendant’s daughter must be a trusted person that the defendant could rely on to receive the gambling debts from PW2, while Lam Lai Ling has the similar name to defendant’s wife, Lam Lai Fun, she might be related to the defendant’s wife. 66.At least the $200,000 from the defendant’s daughter could be safely returned to the defendant or she and the others (Cheng, Poon, Lam and DLT) were participants (all received cheques in March 2019 as started in para 19 of the admitted facts.) in this lion shares of the bet (about 5 million) on 2 March 2019, as the defendant had taken $3,220,000 cash from PW2. 67.In para 23 of the admitted facts, on a race day 15 May 2019 – the defendant and PW1 had 6 calls among themselves from 21:07 to 23:02, that was a period of 2 hours. 68.While on 12 October 2019 – there were 23 phone calls between PW1 and the defendant, a period of about 7 hours – from 13:20 to 20:46. 69.On 16 October 2019 – there were 16 phone calls between PW1 and the defendant, a period of about 2 hours – from 20:11 to 22:22. 70.On 30 October 2019 – there were about 11 phone calls, a period of about 3 hours – from 21:10 to 22:55. 71.The question to ask, why would the defendant do it free for PW1 when both of them said that they were not close friend (PW1’s evidence), they were just ordinary friends (from defendant’s under caution)? Bearing in mind that, PW1 did not pay him any thing for his services. 72.The defendant has to stand by on the racing days to receive calls from PW1 and finalise the wins and the losses with PW1 at the end of each race days. And he was physically in Hong Kong in those race days as set out in para 25 of the admitted facts. Any properly directed jury would draw the irresistible inference that the defendant must have a financial interest from PW1’s bets. 73.Why would the defendant take trouble to do all these things for PW1 especially PW1’s bets were massive bets. PW1 was not required to pay any fund in advance. The defendant had to be responsible for collecting the betting sums when PW1 lost on the bets. When PW1 won the bets, the defendant was the one responsible for settling the bets. In either way, the defendant faced great risk. 74.When PW1 defaulted payment of the bets, the defendant would be responsible for it because he was the one to take the bets from PW1. 75.We have heard evidence from PW1 that he met the defendant in a sauna place as he went there 2 to 3 times a week and they became acquaintance. PW1 was a heavy gambler on horses (he owned a company and took 1.5 million as monthly salary) and they talked about horses. Surely, the defendant over time must have known PW1’s financial status and the way he gambled. 76.PW1 said that in 2018, it was the defendant on his own initiative to tell PW1 that he could place bets on PW1’s behalf. 77.When PW1 won, the defendant only paid in cash to PW2. They were not in small amount, from the admitted facts:-
78.One would wonder why the defendant only paid PW1’s winnings in cash? Where did the cash come from? Who would carry around so much cash in hand? On the other hand, after receiving cash from PW2, where did the cash go to? 79.Clearly, payment by cash is another way to avoid tracing of the gambling funds from any accounts in the event that the defendant was caught. The defendant knew too well that he should not leave any signs of evidence that his bank account involved in any of these gambling funds, I consider that it was a calculate move on the part of the defendant to conceal his illegal activities. 80.PW3 also explained that illegal gambling activities involves 3 roles, the taker, the agent and the bettor:-
81.PW3 in Court also explained that the agent can take 1% as profit in 2 ways:-
82.The Prosecution said that the 0.5% or 1% was not part of the agreement between the defendant and PW1 (para 50 of the final submissions) as PW1 denied any payment of commissions or tips to the defendant. 83.When the defendant acted as an agent for the bookmaker, the minimum amount being taken by the defendant over time - (the offence period when PW1 placed bets with the defendant) - would be in region of $135,000 to $270,000 (being 0.5% to 1% to the $27 million of PW1’s lost). This is still the profit from PW1’s bet. 84.In the present case, PW3 said although the defendant said under caution that he took 0.5% to 1%, but there was nothing from the available evidence to support his assertion. I agree with PW3. 85.PW3 disagreed with the defence that the agent could only act for one party, such as for the punter. PW3 explained that in such a circumstance, there was no banker and there was no gambling as no banker to take the bets. 86.While on the other hand, only the agent acted for the banker without the bettor, again there would be no bets. 87.PW3 said that the agent would be the agent for both the banker and the punter at the same time. 88.PW3 cannot see where did the defendant placed PW1’s bets. PW3 also said that a bettor put up a bet on the website did not necessarily mean there would be a taker or takers to accept the bet. When there is no taker of the bet, the bet becomes invalid after the race. 89.However, the defendant accepted PW1’s bets when PW1 called to place his bets. The defendant also responsible for handling of the winnings and losses of PW1’s bets as previous discussed above – by collecting cash from PW2 or paying cash to PW2 or cheques to different accounts. 90.PW3 said that the defendant had taken the bets. In such circumstances, when the defendant had taken the bets as his own, the chances of winning and losses arose as he had financial interest in the outcome of the races. The defendant took profit from PW1’s losses stake if PW1 did not win. The defendant had to pay according to the odd from the Jockey Club if PW1 won. 91.There is no dispute that PW1 placed bets with the defendant from 12 September 2018 to 31 October 2019. When the defendant said under caution that “I did not accept their bets and dared not accept them”, it is obviously not true and I attach no weight to his assertion. Clearly from the above evidence before me, the defendant carried on his activities of accepting bets from PW1 during this period of time as a trade or business. The Conclusion 92.Having considered all the evidence before, I accepted that all the prosecution witnesses are telling truth, they are honest and reliable witnesses. I accepted their evidence. There is no doubt in my mind that the defendant was engaging in bookmaking in a role as a taker/bookmaker. My conclusion is that the Prosecution have proved the case beyond all reasonable doubt. The defendant is convicted as charged.
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