HKSAR v. Cheung Hoi Wai

DCCC 1519/2024

[2026] HKDC 887

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 1519 OF 2024

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REASONS FOR SENTENCE

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1.The Defendant pleaded guilty to 3 counts of “Dealing with Property known or believed to represent the proceeds of an indictable offence” together with persons unknown, contrary to sections 25(1)  and (3)  of the Organized and Serious Crimes Ordinance, Cap. 455 (Charges 1 to 3).

SUMMARY OF FACTS

2.The Amended Summary of Facts admitted by the Defendant are as follows:

(1)  In the course of an investigation, police officers of the Financial Intelligence and Investigation Bureau became aware of the following bank accounts of which the Defendant was the sole account holder:

(i)  Bank account numbered 012-815-1-017915-2 with Bank of China (Hong Kong)  Limited (Account 1);

(ii)  Bank account numbered 882000036796 with the Airstar Bank Limited (Account 2);

(iii)  Bank account numbered 454-825845-833 with the Hongkong and Shanghai Banking Corporation (Account 3).

The Accounts

Account 1

(2)  On 24 June 2005, the Defendant opened Account 1 in a bank branch. Account opening documents of Account 1 contained a copy of the HKID of the Defendant. The Defendant reported that he resided in a flat in Tak Shui House, Tak Tin Estate, Lam Tin (the Reported Address). Account 1 was closed on 10 June 2021.

(3)  Account 1 had a significant upsurge in transactions between 23 March 2021 and 13 March 2021. During the period:

(i)  The opening balance of Account 1 as at 23 March 2021 was HK$0.98 and the closing balance of Account 1 as at 30 March 2021 was HK$26.28;

(ii)  A total of 21 deposits amounting to HK$4,452,795.22 were deposited into Account 1;

(iii)  A total of 29 withdrawals amounting to HK$4,452,890.92 were withdrawn from Account 1;

(iv)  Most deposits and withdrawals during the period were made through Internet transfer;

(v)  Suspicious transaction pattern was noted in Account 1 during the period such as quick withdrawals, following deposits, sudden upsurge in deposits and sudden dormancy of Account 1.

(4)  Between 23 March 2021 and 30 March 2021, based on the transaction patterns observed, Account 1 was used as a temporary repository of funds.

Account 2

(5)  On 15 April 2021, the Defendant opened Account 2 online. Account opening documents of Account 2 contained a selfie and a copy of the HKID of the Defendant. The Defendant reported that he was residing in Sham Shui Po. Account 2 was closed on 12th July 2021.

(6)  Account 2 was only active between 29 April 2021 and 5 May 2021 (excluding interest payments and an account closure withdrawal). During the period:

(i)  The opening balance of Account 2 as at 29 April 2021 was nil and the closing balance of Account 2 as at 5 May 2021 was HK$0.28;

(ii)  A total of 19 deposits amounting to HK$2,214,719.28 were deposited into Account 2;

(iii)  A total of 8 withdrawals amounting to HK$2,214,719 was withdrawn from Account 2;

(iv)  All deposits and withdrawals during the period were made through Internet transfer;

(v)  Suspicious transaction pattern was noted in Account 2 during the period such as quick withdrawals following deposits and sudden dormancy of Account 2.

(7)  Between 29 April 2021 and 5 May 2021, based on the transaction patterns observed, Account 2 was used as a temporary repository of funds.

Account 3

(8)  On 2 May 2021, the Defendant opened Account 3 online. Account opening documents of Account 3 contained a copy of the HKID of the Defendant and a signature specimen of the Defendant. The Defendant reported that he was residing at the Reported Address. Account 3 was closed on 9 February 2022.

(9)  Account 3 was only active between 4 May 2021 and 24 May 2021 (excluding an account closure withdrawal. During the period:

(i)  The opening balance of Account 3 as at 4 May 2021 was nil and the closing balance of Account 3 as at 24 May 2021 was HK$717.42;

(ii)  A total of 45 deposits amounting to HK$12,609,409.42 were deposited into Account 3;

(iii)  A total of 82 withdrawals amounting to HK$12,608,692 were withdrawn from Account 3;

(iv)  All deposits and withdrawals during the period were made through Internet transfer;

(v)  Suspicious transaction pattern was noted in Account 3 during the period such as quick withdrawals following deposits and sudden dormancy of Account 3.

(10)  Between 4 May 2021 and 21 May 2021, based on the transaction patterns observed, Account 3 was used as a temporary repository of funds.

Arrest of the Defendant

(11)  On 1 December 2021, the Defendant was arrested by DPC7696 (PW1)  at the Reported Address. Between 0652 hours and 0700 hours on 1 December 2021, PW1 conducted a search with a search warrant at the Reported Address and seized, inter alia, a letter from the Hongkong and Shanghai Banking Corporation on Account 3 dated 8 October 2021.

Background of the Defendant

(12)  According to records provided by the Inland Revenue Department, the Defendant or his employers had reported that the Defendant had an annual income of HK$119,366 and HK$146,275 for financial years 2019/20 and 2020/21 respectively.

Conclusion

(13)  Based on the Defendant’s background, transaction patterns of Accounts 1 to 3 and the overall circumstances of the case, the Defendant was a “money laundering stooge” who enabled the money laundering activities of persons unknown through Accounts 1 to 3.

(14)  At all material times, the Defendant together with persons unknown, knowing or having reasonable grounds to believe that property, namely, the monies deposited into Accounts 1 to 3, in whole or impact, directly or indirectly, represented any person’s proceeds of an indictable offence, dealt with the said property.

SUBMISSIONS FILED

3.The Defendant was originally represented by Ms Diane Crebbin. After the last hearing, there was a change of counsel. The Defendant is now represented by Mr Nicklaus Pannu-Yuon who filed his “supplemental submissions on mitigation” on 13 May 2026. Since Mr Pannu-Yuon’s submissions are said to be supplemental and some of the points taken are inconsistent with Ms Crebbin’s submissions, the Court will have to deal with both sets of submissions.

THE DEFENDANT’S BACKGROUND

4.Mr Pannu-Yuon adopted Ms Crebbin’s submissions in respect of the Defendant’s background.

5.The Defendant is 49 years old and received education up to Form 3 level. He is married, has two daughters (aged 16 and 4). They live with the Defendant’s 90-year-old mother in a public housing estate in Lam Tin.

6.The Defendant has 14 criminal convictions, which involved a total of 27 charges, none of which are similar to the present offences. His last conviction was on 20 May 2025 where he was sentenced to 45 months’ imprisonment.

SENTENCING PRINCIPLES

7.Money laundering is a very serious offence, the maximum sentence for which is a fine of $5,000,000 and imprisonment for 14 years.

8.The facts of money laundering cases are highly variable. There are no sentencing guidelines. However, the Court of Appeal has laid down factors to be considered in sentencing.

9.In HKSAR v Hsu Yu Yi (2010)  5 HKLRD 545, the Court of Appeal stated:

(1)  There are no sentencing guidelines for the offence of dealing with the proceeds from an indictable offence because the facts vary from case to case;

(2)  The following factors are to be taken into account when determining sentence:

(i)  the amount of money involved that is a major consideration, and not the amount of benefit received by the defendant in the transaction;

(ii)  The culpability of the offence lies in the assistance, support and encouragement offered to the commission of an indictable offence. So the defendant’s level of participation and the number of occasions on which he is involved in the “money laundering” activities are relevant factors to be considered;

(iii)  The offence of dealing with the proceeds from an indictable offence does not necessarily have any direct correlation with the indictable offence in question. However, if the relevant indictable offence can be identified, the court may take into account the sentence imposed on the indictable offence per se when determining the sentence of the dealing offence;

(iv)  If the case has an international element involving activities carried out across different regions, the court may impose a more severe sentence. This is to protect Hong Kong’s reputation as an international finance and banking hub from being tarnished;

(v)  The length of time the offence lasted.

10.In HKSAR v Boma (2012)  2 HKLRD 33, the Court of Appeal reiterated that there are no sentencing guidelines, but the amount of money laundered is a significant feature. The Court of Appeal also elaborated on the relevant factors to be considered and provided a non-exhaustive list of such factors:

(1)  The nature of the predicate offence;

(2)  The state of the offender’s knowledge;

(3)  Where the operation involves an international dimension, this will be a significant aggravating feature. The Mainland is included for the purpose of international dimension;

(4)  The sophistication of the offence;

(5)  Where the offence is committed by or on behalf of an organized criminal syndicate, that is an aggravating factor;

(6)  The number of transactions and the length of time over which the offence was committed;

(7)  It will be an aggravating feature where the offender continues to launder funds after he has discovered the nature of the offence which is serious; and

(8)  The role of the offender and the acts performed by him.

11.The fact that the Defendant did not receive any benefit or only received a small amount of benefit is not a mitigating factor: Secretary for Justice v Ngai Fung Sin Apple [2013] 5 HKLRD 104.

12.In Secretary for Justice v Wan Kwok Keung（雲國強）[2012] 1 HKLRD 197, the Court of Appeal stated:

“15. In HKSAR v Hsu Yu Yi [2010] 5 HKLRD 536, Cheung JA set out the amount of money involved and the sentences passed in a number of “money laundering” cases. The sentencing starting point is 3 years or so where the “black money” involved is between 1 million and 2 million dollars, 4 years or so where it is between 3 million and 6 million dollars, and could be over 5 years where it is above 10 million dollars.”

DISCUSSIONS

Cases Cited

13.Ms Crebbin referred to the sentences in a number of cases. Apart from Wan Kwok Keung mentioned above, they include HKSAR v Fan Shek Hung[2008] 1 HKCLRT 428; HKSAR v Chen Szu Ming CACC 270/2025; HKSAR v Xu Xia Li (2004)  4 HKCLRT 16 and HKSAR v Mak Shing CACC 322/2001.

14.Ms Crebbin provided the Court with brief summaries of those cases. The summary in respect of Xu Xia Li was basically correct. However, the summaries for the 3 remaining cases are not entirely accurate.

15.In Fan Shek Hung, the amount involved was $15,825,000 (close to HK$16,000,000)  and not $15,000,000. Counsel stated that the Defendant had knowledge of a fraudulent scheme involving persons feigning to be vendors selling a property. In fact, the Court of Appeal found that not only did the Defendant have knowledge of the fraudulent transaction, he participated in the same. In those circumstances the Court of Appeal found that the appropriate sentence was 5 years and 8 months after trial.

16.In Chen Szu Ming (not Chen Sze Ming), the applicant pleaded guilty to 3 counts of “money laundering”. The total amount involved $16,105,000 and not $17,000,000. Counsel alleged that the applicant had knowingly taken part in an elaborate deception with others. In fact, the Court of Appeal stated:

“19. … Secondly, the judge had apparently accepted that the applicant in fact believed the nature of the underlying fraud to be different in kind to the actual fraud. That being so the details of the actual fraud were unknown to the applicant and were irrelevant to any assessment of his culpability so far as the money laundering offences were concerned. All that could be said was that the applicant knew that the funds deposited into his account came from fraud of some sort.”

17.In Mak Shing, the amount involved was RMB14.56 million (about HK$15,000,000). Ms Crebbin submitted that the applicant knew that the funds were obtained illegally from China but did not know how serious the indictable offence was. In fact, the applicant was informed that the funds came from the proceeds of smuggling cigarettes in China.

18.Although the amounts involved in the cases cited are close to the amount in the present case, the facts of those cases are completely different. In Mak Shing, there was an exceptional mitigating factor. When the applicant discovered that the police were making inquiries of the matter, he voluntarily went to the police and provided them with particulars of what had transpired.

19.In addition to Boma and Hsu Yu Yi, Mr Pannu-Yuon referred to HKSAR v Xie Zhijian [2025] HKCA 911. The sentencing principles set out in Xie Zhijian is a summary of the principles in Hsu Yu Yi and Boma. I will not repeat them here.

20.In relation to the appropriate starting point, Mr Pannu-Yuon cited HKSAR v Chow Lai Ying Candy [2021] HKCA 1922; Xu Xia Li (ibid)  and HKSAR v Lau Siu Wan [2024] HKDC 944.

21.He submitted that in Chow Lai-ying, the total amount laundered was HK$102.9 million over a period of 5 years and 6 months. The Defendant was described as the “spider in the centre of a rather intricate financial web”.

22.Mr Pannu-Yuon submitted that Macrae VP “left undisturbed a starting point of 4 years’ imprisonment”. If Mr Pannu-Yuon is saying that Macrae VP agreed with the sentence, I disagree. In that case, the Applicant pleaded guilty to 4 out of 8 counts of money laundering. The 4 accounts in her name were used to deal with a total of HK$102.9 million over 5 years and 7 months. The Applicant was a housewife. The funds came from the unlawful bookmaking operation perpetrated by the Applicant’s husband. The judge adopted a global starting point of 4 years and ultimately sentenced the Applicant to 2 years and 7 months’ imprisonment. Firstly, this was an application for leave to appeal against sentence by the Applicant, and not a review of sentence by the Secretary for Justice. It was crystal clear from the judgment that Macrae VP did not approve of the starting point adopted by the sentencing judge. In refusing leave to appeal, Macrae VP stated:

“20. I do not see it as reasonably arguable that 2 years and 7 months’ imprisonment upon pleas of guilty was, in this case, either manifestly excessive and/or wrong in principle. Indeed, having been taken by Ms Lau to the judgment of HKSAR v Chiu Chi Wing and the cases referred to by the Court therein, I can well conceive that some judges might take the view that the sentence was lenient. I accordingly refused leave to appeal against sentence.

21. In view of my last remark that the sentence could be viewed as lenient, I should advise the applicant that she has the right to renew her application for leave to appeal against sentence to the Court of Appeal. However, she should also be warned that the Court has the power to order loss of time which the applicant has spent in custody pending her appeal, if it were to come to the conclusion that there was no justification for the renewal of the application.”

23.Mr Pannu-Yuon submitted that in Xu Xia Li, the Court of Appeal affirmed a starting point of 3 years’ imprisonment where the total laundered amount was HK$11 million and the Defendants have specifically flown to Hong Kong for the purpose of money laundering.

24.In fact, there were 2 Applicants in that case. The first Applicant was found to have conspired with a person (Kwong)  to launder HK$11 million. The second Applicant was found to have conspired to launder HK$3 million. Both Applicants were sentenced to 3 years’ imprisonment.

25.The facts of Xu Xia Li are very different from the present case. On 14 October 2001, the first Applicant flew to Hong Kong, opened a bank account and deposited a cheque for HK$11 million from Kwong. She then left for Canada and stayed in the second Applicant’s house. The second Applicant came to Hong Kong with the first Applicant on 22 October. She received transfers from Kwong’s account into her bank account and dissipated some HK$3 million for Kwong. In other words, only one bank account was involved for each Applicant. In the present case, 3 accounts are involved. In Xu Xia Li, the judge found that the Applicants had reasonable grounds to believe that the money were proceeds of crime rather than actual knowledge that the funds were the proceeds of crime. In the present case, the Defendant accepted that he knew that illegal money must have been involved when he was first asked to lend his bank account. He then proceeded to open 2 further accounts successively for money laundering. This is an aggravating factor.

26.Again, Xu Xia Li was an appeal against sentence, not a review of sentence. The Court of Appeal found that “the sentence of three years’ imprisonment after trial imposed by the judge cannot be criticized for being too harsh in the circumstances or against principle or in any way manifestly excessive”.

27.Mr Pannu-Yuon then relied on HKSAR v Lau Siu Wan [2024] HKDC 944, where the defendant laundered over HK$28 million over several years and played an active role in the predicate offence and laundering exercise. He pointed out that “a notional sentence of 38 months was passed following a guilty plea”.

28.Firstly, that was a sentencing case from the District Court. There is no dispute that it is not binding on this Court. Further, the Court of Appeal has clearly stated on numerous occasions that the sentences in other cases from the same level of Courts have not been tested on appeal and do not lay down any sentencing principles. They are of neither binding, nor provide any points of reference and should not be cited as if they are authorities: 律政司司長訴溫達揚 CAAR 21/2021, 23 September 2022, unreported; 律政司司長對唐健帮及另二人 CAAR 13/2022, [2023] HKCA 896 and 香港特別行政區對劉晉旭及其他人 CACC 243/2021, [2023] HKCA 1098.

29.Secondly, the facts in that case are very different from the present case. There were also special mitigating factors in that case. The Defendant was only one of the persons involved in the money laundering. Other defendants involved in the syndicate had already been convicted and sentenced by another Court. The Defendant left Hong Kong before he was aware of the investigation. He voluntarily surrendered to the police after he heard about the conviction of the other defendants.

30.Thirdly, there was never “a notional sentence of 38 months” in that case. The learned judge adopted a starting point of 36 months for each of Charges 1 and 2 and a starting point of 39 months for each of Charges 3 and 4. The sentence was reduced by one third for the Defendant’s guilty plea. The learned Judge then gave a further discount of 3 months for surrendering to the police and a further month for active charitable work. The learned Judge then considered the question of totality. She considered that an overall sentence of 38 months’ imprisonment after plea and mitigation to be appropriate.

Starting Point

31.Ms Crebbin submitted that:

(1)  the nature and seriousness of the predicate offence or offences is unknown;

(2)  there is no evidence to suggest that the Defendant was aware of the nature or seriousness of the predicate offence(s);

(3)  the amount laundered in the present case is about HK$19,000,000;

(4)  the period of time over which the scheme lasted was relatively short, between March and May 2021;

(5)  there were 85 deposits and 119 withdrawals across the 3 different bank accounts;

(6)  the Defendant’s involvement was setting up the 3 bank accounts and lending them to another person;

(7)  there is no evidence that the Defendant benefited from the offences. In fact, the Defendant stated he received no benefit;

(8)  there is no evidence of any international element;

(9)  there is no evidence of the number of people involved in the money laundering scheme; and

(10)  there is no evidence that the Defendant was working for an organized criminal syndicate.

32.Ms Crebbin submitted that the appropriate starting point was in the region of 5 to 6 years.

33.Mr Pannu-Yuon made similar submissions. However, he stated that the Defendant’s involvement was limited to lending his account to another person. He submitted that the mere lending of his account to others reflected very low sophistication and degree of planning.

34.I do not agree entirely with Mr Pannu-Yuon’s submission. He appears to have lost sight of the fact that there are 3 charges, involving 3 different bank accounts:

(1)  The bank account in Charge 1 was opened on 24 June 2005. In other words, this account was in existence prior to the commission of the offences by the Defendant and he might have lent this account to another person. This account in Charge 1 was used to launder HK$4,452,795.22 between 23 March 2021 and 30 March 2021. There were 21 deposits and 29 withdrawals within the space of about a week;

(2)  The bank accounts relating to Charges 2 and 3 were not in existence when the Defendant committed Charge 1;

(3)  The bank account in respect of Charge 2 was opened on 15 April 2021. The opening balance in this account was nil. It was then used to launder HK$2,214,719.28 between 29 April 2021 and 5 May 2021. In other words, this account was opened specifically to launder funds. There were 19 deposits and 8 withdrawals within the space of about 1 week;

(4)  Similarly, the bank account relating to Charge 3 was not in existence when the Defendant committed Charges 1 and 2. This account was opened on 2 May 2021. The opening balance was nil as at 4 May 2021. The account was then used to launder HK$12,609,409.42 between 4 May 2021 and 24 May 2021. There were 45 deposits and 82 withdrawals within about 3 weeks.

35.The only and irresistible inference from the above is that the bank accounts in Charges 2 and 3 were opened successively for the specific purpose of “money laundering”. The Defendant did not merely “lend his account” to others for money laundering.

36.Although his submissions are entitled “supplemental”, it appears from the cases cited by Mr Pannu-Yuon that he does not agree with Ms Crebbin’s submission on the appropriate starting point.

37.I agree that the predicate offence for each charge is unknown in the present case. There is no evidence to show that the Defendant knew the nature of the predicate offence(s)  or that there was any international dimension. According to the Amended Summary of Facts, the Defendant opened bank accounts to receive the “black money”. There was no evidence to show whether the Defendant received any benefit from the money laundering activities.

38.However, total amount involved was $19,276,924, a very substantial sum. There were 85 deposits over the space of merely 2 months. The predicate offence was clearly either very serious or extensive.

39.Both Ms Crebbin and Mr Pannu-Yuon submitted that there was no evidence that the Defendant was working for an organized criminal syndicate. In fact, the Court raised the question of delay in prosecution at the last hearing. According to the Chronology produced by the Prosecution, in November 2021 and acting on intelligence, police commenced investigation against a money laundering syndicate. They identified 64 bank accounts belonging to 15 individuals (including the Defendant)  who laundered about HKD 304 million between January 2019 and November 2021. On 1 December 2021, police arrested the 15 individuals, including the Defendant. However, this was not mentioned in the Amended Summary of Facts. In those circumstances, this Court has no alternative but to accept that there was no evidence that the Defendant was working for an organized criminal syndicate.

40.Both Ms Crebbin and Mr Pannu-Yuon only made submissions in respect of the overall starting point.  With respect to Counsel, that is not the proper procedure. The Court must first assess the appropriate starting point for each charge before considering the question of the overall sentence:

(1)  The first charge involves $4,452,795.22. The appropriate starting point is 3 and a half years (42 months)  imprisonment;

(2)  The second charge involves $2,214,719,28. The appropriate starting point is 3 years imprisonment;

(3)  The third charge involves $12,609,409.42. The appropriate starting point is 5 years imprisonment.

MITIGATION

41.The Defendant has pleaded guilty at the earliest opportunity. He is entitled to a one-third discount. The starting points of the 3 charges are reduced to:

(1)  Charge 1: 28 months;

(2)  Charge 2: 2 years; and

(3)  Charge 3: 3 years and 4 months (40 months).

42.Ms Crebbin explained that the Defendant used to work as a welder and was the sole bread winner of the family. He lost his job as a result of the Pandemic and had no means to support his family. It was at this time when a “good friend” asked the Defendant to lend him the Defendant’s bank account to “move some money”. The Defendant knew that the money involved must have been “illegal money”. However, he did not know the source of the money or the amounts involved. The Defendant agreed to let his friend use his bank account. He gave his friend the bank cards and all necessary information to enable his friend to operate the bank accounts. In return, the Defendant was promised a small commission. The amount of the reward was not mentioned and the Defendant never received any reward.

43.Firstly, it is more than evident that the Defendant has been consistently in and out of prison. Further, it is trite law that financial difficulty and personal circumstances are not relevant as mitigation in serious cases, no matter how desperate or tragic the situation of the accused: R v Kwok Yau Fat (CACC 537/1996, 28 February 1997, unreported; Attorney General v Yan Chun Fong [1993] 1 HKCLR 42, 45 and Secretary for Justice v Nones Carmelita Galay [2023] 1 HKCLR 139.

44.Ms Crebbin also submitted that the Defendant is deeply remorseful. In HKSAR v Ngo Van Nam [2016] 5 HKC 231, the Court of Appeal has already pointed out that the discount for a guilty plea is the high watermark and includes remorse and all other mitigating factors. Unless there are exceptional mitigating factors, no further discount should be given.

45.Ms Crebbin further submitted that the Defendant’s mother requires constant medical attention due to her old age and that the Defendant is very concerned about her. However, family hardship attendant upon the conviction is to be viewed as a part of the price an accused must pay for the crime: HKSAR v Li Kwok Ching [1995] HKCU 1702. Those who commit offences should keep in mind ‘the principle that the effect of imprisonment upon an offender’s family is not a factor normally to be taken into a account’: HKSAR v Chan Kin Chung [2002] 4 HKC 314, 321. Family circumstances, in any event, ‘are matters which a wise man would take into consideration before he commits an offence and not after’: HKSAR v To Yiu Cho [2009] 5 HKLRD 309, 311.

46.Finally, Ms Crebbin submitted that the Defendant himself met with an accident in 2024 and sustained fractures to 3 bones in his foot which still causes him pain and problems walking. The ill health of an accused ‘is not a licence to commit crime’: Clarkson v R (2007)  161 A Crim R 1, 49. In Yip Kai Foon v HKSAR [2000] 1 HKC 335, 339, Li CJ said: ‘Under the guidelines and principles evolved by the courts, medical grounds will seldom, if ever, be a basis for reducing the sentence for crimes of gravity’. In HKSAR v Tam Yuen Tong [2007] 1 HKLRD 894, 896, McMahon J made the point that ‘as a matter of reality, most prisoners receive medical attention in prison of an equal or better standard than they would otherwise receive’. In HKSAR v Chan Kau Tai [2008]. HKC 78, 89, it was noted that the accused who needed a liver transplant was being attended to in the custodial ward at Queen Mary Hospital and was ‘in good hands’. Save in the rarest of cases, a prisoner’s medical condition is not a matter to which the court will have regard for mitigation of a proper sentence: R v Ho Mei Lin [1996] 4 HKC 481, 493.

47.In his supplemental submissions, Mr Pannu-Yuon cited HKSAR v Ho King Nang CACC 445/2010, 30 November 2011. He submitted that the Court of Appeal found a period of two and a half years between the arrest and charging of the defendant to be unreasonable delay. On that basis, a 3 month discount was granted. He pointed out that the Defendant in the present case was arrested on 1 December 2021 but was only charged on 10 September 2024 which constituted a delay of more than 3 years. He argued that during that period, the “sword of Damocles” hung over the Defendant’s head and has undoubtedly caused immense pressure.

48.As mentioned above, the question of an unreasonable delay in prosecution was raised at the last hearing. Ms Crebbin confirmed that there was no such argument. Mr Pannu-Yuon is now taking a polar opposite stance.

49.A Chronology was produced by the Prosecution, a copy of which was provided to the Defence. The police started investigation of a money laundering syndicate dealing with HK$304 million, 64 accounts held by 15 individuals (including the Defendant)  in November 2021. The Defendant and other 14 other individuals were arrested on 1 December 2021. The Defendant was released on police bail on 2 December 2021.

50.Since the case involved 64 bank accounts held by 15 individuals, it would take substantial time for the police to collect documents, including bank opening documents, bank transaction records and tax returns etc. Those documents have to be analysed after they become available. However, on 3 January 2022, the Defendant failed to answer police bail and became out of reach. As a result, 6 other individuals (excluding the Defendant)  were charged with money laundering offences between 2023 and 2024.

51.In other words, any delay in prosecution was caused partly at least by the Defendant. There are no grounds for alleging that the delay was caused by the Prosecution. Further, it is clear from the Defendant’s record that he has been committing a string of other offences after his arrest and prior to being charged in the present case. It appears that the alleged “sword of Damocles” has had no effect on him.

52.In short, apart from his timely guilty plea, there are no other mitigating factors.

PROCEDURE FOR ENHANCEMENT OF SENTENCE

53.The prosecution applies for enhancement of sentence pursuant to section 27 of the Organized and Serious Crimes Ordinance, Cap. 455 (the Ordinance).

54.For the purposes of deciding whether an enhanced sentence should be imposed and under the terms of section 27(2)  of the Ordinance, the prosecution furnished this Court with a statement of Mr Li Yiu Nam, Chief Inspector of Police. An English translation of that witness statement was provided to the Defence during the adjournment.

55.The Court of Appeal set out the proper procedure in considering enhancement of sentence in Tam Wai Pio as follows at 955J to 956D:

“Instead, we offer the following guidance in order to minimize the risk of confusion for cases where enhancement of sentence has to be dealt with under the procedure laid down in the Ordinance. This approach would, of course, have to be adapted as necessary when multiple offences are involved, some of which are not organized crimes. In such circumstances, a judge should consider, determine and set out in clear terms:

(1)  (a)  the appropriate starting point having regard to the part played by the defendant, and

(b)  the sentence that the court would have imposed, taking into account, the defendant’s mitigation and totality;

(2)  whether the specified offence was an organized crime within the meaning of s.2 of the Ordinance;

(3)  whether the crime calls for an enhancement of the sentence under the terms of s.27(11)  having regard to the information supplied by the prosecution to the court under s.27(2)(a)  to (e)  or s.27(8)  or the general nature of the organized crime itself;

(4)  if enhancement is called for, the percentage increase by way of enhancement of the sentence.”

56.I will therefore follow the procedure in Tam Wai Pio and consider the question of totality before the the issue of enhancement.

TOTALITY

57.The submissions on totality from both Counsel are essentially the same. Ms Crebbin submitted that ‘based on the evidence these three charges are all closely linked and part of effectively one money laundering operation”. She asked the Court to order that the sentences of all three charges to run concurrently. Mr Pannu-Yuon submitted that Charges 1, 2 and 3 occurred out of similar facts and were within materially the same time frame. He asked the Court to order the sentences of all charges to be served concurrently, in line with the one transaction rule and the totality principle.

58.Firstly, the 3 Charges related to different sums of money deposited into 3 different bank accounts at different times.

59.More importantly, in HKSAR v Ngai Yiu Ching [2011] 6 HKC 238, the Court of Appeal stated:

“13. When a judge is faced with the task of sentencing for multiple offences, he is required as an initial step to identify the appropriate sentence for each offence and as the final step to achieve a total sentence appropriate to the culpability of the offender. The issue with which this appeal is concerned is the decision that the judge faced whether to order any of the sentences for the offences to run concurrently with each other or to be served consecutively.

14. The question whether to order concurrent or consecutive sentences can arise in many different scenarios. An offender may be charged in respect of a number of different, or similar, offences committed on wholly separate occasions over a period of time or with a number of different offences committed in the course of one episode of criminal activity. This case is concerned with the latter situation.

15. In the case of several offences committed in the course of a single episode, the prosecuting authorities might choose to prefer only one charge, where one charge embraces all the criminal conduct reflected by the evidence or, as in the present instance, separate charges for each criminal act.

16. If it chooses the former course, the instances of proved conduct and embraced by the single charge but which could have been the subject of separate charges are taken into account in deciding what penalty reflects the true overall criminality.

17. But when the prosecuting authority elect the latter course, namely, to charge two or more offences arising from an episode of criminal activity, the objective is still the same; that is to say, the ultimate overall sentence must still reflect the overall and true culpability, although the sentencing judge must take care, first, to pass a sentence for each individual offence that is appropriate to that offence and the circumstances of its commission, and, second, not to punish the offender twice for the same conduct.

18. It was in an attempt to safeguard fairness to the offender by ensuring that he was not punished twice for the same conduct that the courts developed the ‘one transaction’ rule. In essence, this rule said that if the number of offences have been charged arising from the one transaction or course of criminal conduct, then concurrent sentences should be imposed.

19. The one transaction rule was not developed as an inflexible rule of law. It was never intended as anything more than a practical rule of thumb to guide judges in the exercise of the power to impose consecutive sentences so that the final sentence was not one that was unfair to an offender.

20. However, once stated, this practical working rule tended to develop a life of its own and has led to some difficulty in its application. Judicial dicta explained what was meant by "one course of criminal conduct" and exceptions to the rule developed … All of this, understandably enough, became material for advocates who sought to argue that the multiple offences of which their client had been convicted were part of one transaction and that it inevitably followed that the correct sentence was one where all the sentences were concurrent.

21. There are several problems associated with this line of reasoning. First it runs the risk of elevating a practical working rule to a rule of law, thereby providing an opportunity to argue that departure from it inevitably meant that the sentence imposed on the client was excessive. Secondly, it tends to obscure the real point which is not whether two or more offences are committed at about the same time, but whether the second or other further offences add to the culpability or criminality of the first. Thirdly, it ignores the reality that whatever sentence is arrived at after application of the rule is still subject to the totality principle.

22. The importance of the totality principle cannot be overstated. It is there to ensure not only fairness to the offender, in the sense that he is not punished twice for the same offence and, further, that the sentence is not an unduly crushing punishment but it is also a tool by which to ensure that “the overall effect of the sentences is sufficient having regard to the usual principles of deterrence, rehabilitation and denunciation.”: R v K M [2004] NSWCCA 65 at paragraph 55.

23. The emphasis therefore should be on a reflection in the sentence of true culpability disclosed by the offences of which the accused has been convicted. This is an approach which this court has consistently adopted in recent times … It is likely to be a more effective approach in reflecting an offender’s overall culpability than one which becomes overly concerned with the one transaction rule, although in the case of more than one offence, the court must guard carefully against punishing twice for the same act. If the second offence which takes place in the course of the suggested single episode adds to the culpability of the first offence, it will normally follow that the sentence for the second offence will run wholly or partially consecutive to that for the first; to what extent, if at all, will depend upon an assessment of the totality appropriate for the conduct as a whole. As with most sentencing exercises, the approach is an art, sensitive to the individual circumstances of the case and the offender.”

60.In the present case, the 3 charges related to 3 different accounts which were used to launder different amounts of money at completely different times. In those circumstances, the sentences for the 3 charges should be served consecutively. However, I have to consider the question of totality. I agree with Ms Crebbin that the appropriate overall starting point after trial is 6 years’ imprisonment. The overall sentence is reduced to 4 years’ imprisonment after a guilty plea.

ENHANCEMENT OF SENTENCE

61.Ms Crebbin does not dispute that an enhancement was warranted. Ms Crebbin submitted that unlike HKSAR v Tam Wai Pio (1998)  2 HKLRD 948 and HKSAR v Ma Suet Chun & others (2001)  4 HKC 337, the present case did not involve triads, people smuggling or the use of force to recover money.

62.The power to pass an enhanced sentence under the Ordinance is provided by s 27(11)  which reads:

“(11)  Subject to sub-s.(12)  and (13), where a court is satisfied beyond reasonable doubt:

(a)  that the specified offence was an organized crime, or

(b)  as to any information furnished under sub-s.(2)  or (8),

or where any such matter is agreed by the person convicted, the court shall have regard to such matters when it passes a sentence on the person for the relevant specified offence and may, if it thinks fit, pass a sentence on the person for that offence that is more severe than the sentence it would in the absence of such matter, have passed.”

63.Sections 27(2)  and (3)  of the Ordinance provide as follows:

“(2)  The prosecution may furnish information to the court regarding any or all of the following:

(a)  the nature and extent of any harm caused, directly or indirectly to any person by the act, in respect of which the person has been so convicted;

(b)  the nature and extent of any benefit, whether financial, or otherwise, that accrued, or was intended to accrue, directly or indirectly, to that or any other person from that act;

(c)  the prevalence of that specified offence;

(d)  the nature and extent of any harm, whether direct or indirect, caused to the community by recent occurrences of that specified offence;

(e)  the nature and extent of the total benefit, whether financial or otherwise, accruing directly or indirectly to any person from recent occurrences of that specified offence.

(3)  Only information that would be admissible in evidence in criminal proceedings (including proceedings in respect of sentencing)  may be furnished to the court under subsection (2).

64.It is clear from the wording of the Ordinance and Tam Wai Pio that:

(1)  The Defendant’s role in the offence should be considered when assessing the starting point for each of the offences and not when assessing enhancement;

(2)  The Court should then adjust the sentence by taking into account mitigating factors;

(3)  The Court should then consider the question of totality before dealing with the question of enhancement, and not after enhancement;

(4)  The factors to consider in assessing enhancement are the matters set out in the section 27(2)  statement;

(5)  Not all cases involve organized crime;

(6)  Even if the case does not involve organized crime, the Court has jurisdiction to enhance the sentence on the information supplied by the prosecution under section 27(2)(a)  to (e)  or section 27(8);

(7)  The percentage increase by way of enhancement varies according to the prevalence of the crime.

65.In the present case, the Court has already considered the facts of the case, including the Defendant’s role when assessing the starting point of each of the offences. In assessing the degree of enhancement, the Court would only consider the matters set out in the witness statement of Chief Inspector Li.

66.Ms Crebbin relied on HKSAR v Lee Sai Wing (1998)  4 HKC 280 (which involved false entries in bank records)  and submitted that bearing in mind the Defendant’s role and the facts of the present case, an enhancement of 25 to 30 percent would be appropriate.

67.Firstly, Lee Sai Wing is a case of making false entries in bank records, which is completely different from money laundering. Secondly, as stated above, the percentage of enhancement depends on the information contained in the section 27(2)  statement. Lee Sai Wing was decided in 1998. The information which forms the basis of the application for enhancement is completely different.

68.Mr Pannu-Yuon on the other hand referred to HKSAR v Wu Jing [2026] HKDC 247 where the learned judge enhanced the sentence by 20% for a case involving a “stooge account”. As stated above, sentencing cases in the same level of courts are neither binding nor provide any points of reference. The degree of enhancement depends on the information set out in the witness statement of Chief Inspector Li.

69.Mr Pannu-Yuon admitted that the witness statement of Chief Inspector provided helpful tables relating to money laundering cases. He drew the Court’s attention to the statistics in relation to “ML cases” and “Cases with Stooge Accounts”.

70.He submitted that under “ML cases”, the data shows that the amount of reported losses and/or proceeds laundered in 2025 was 4,577.64 million dollars. This was less than the 7,981.02 million dollars laundered in 2021, the 35,547.21 million dollars laundered in 2022 and the 10,262.73 million dollars laundered in 2023. For the months of January to March 2026, the amount laundered was 871.08 million dollars. He suggested multiplying that number by 4 which would produce a figure of 3,484.32 million dollars for this year. He submitted that this marks a further decrease from 2025.

71.As for “Cases with Stooge Accounts”, he submitted that the data shows that the amount of reported losses and/or proceeds laundered in 2025 was 3,933.14 million dollars. This represents a steady decrease since its peak of 36,320.17 million dollars in 2023. He argued that from the data, the projection for 2026 would be 1,660.84 million dollars which also shows a decrease.

72.Mr Pannu-Yuon argued that the data reflected a decreasing trend regarding the prevalence of money laundering cases as well as the total quantum of such financial crimes. He submitted that if the Court is not satisfied that such offences are prevalent, there should be no enhancement.

73.If the Court is satisfied that such offences were prevalent, then Mr Pannu-Yuon submitted that the degree of enhancement should be no more than 20%.

74.Firstly, in the present application for enhancement, the question for the Court is whether the offences are prevalent, and not whether there is an upward trend in such offences. Contrary to what is suggested by Mr Pannu-Yuon, in deciding whether such offences are prevalent, the Court cannot just consider the reported losses.

75.According to the statement from Chief Inspector Li, the number of deception cases and ML cases (both detected and undetected)  was 16,643 in 2020 (i.e. an average of about 1,387 cases per month)  ; 20,114 in 2021 (i.e. an average of about 1,676 cases per month); 28,936 in 2022 (i.e. an average of about 2,411 cases per month); 42,094 in 2023 (i.e. an average of about 3,500 cases per month); 47,063 in 2024 (i.e. an average of about 3,922 cases per month); 47,701 in 2025 (i.e. an average of about 3,975 cases per month)  and 10,658 in the first 3 months of 2026 (i.e. an average of about 3,553 cases per month).

76.The data also shows that 760 Stooges were arrested in 2020 (i.e. an average of about 63 stooges per month); 2,230 in 2021 (i.e. an average of about 186 stooges per month); 3,708 in 2022 (i.e. an average of about 309 stooges per month); 6,485 in 2023 (i.e. an average of about 540 stooges per month); 7,883 in 2024 (i.e. an average of about 657 stooges per month); 5,355 in 2025 (i.e. an average of about 446 stooges per month)  and 1,480 in the first 3 months of 2026 (i.e. an average of about 493 stooges per month).

77.It is clear from the above data that the use of “puppet” or stooge accounts（傀儡戶口）for money laundering is still extremely prevalent.

78.In the recent case of Secretary for Justice v Xie Zhijian CAAR  4/2024 [2025] HKCA 911, the Respondent pleaded guilty to one count of money laundering and was sentenced to 33 months’ imprisonment after an enhancement of 20%. The Secretary for Justice applied for a review of sentence. The Court of Appeal found the starting point manifestly inadequate and wrong in principle. The Court of Appeal made no mention of the extent of the enhancement. The application was only refused because the applicant was due to be discharged from prison. In those circumstances, I shall adopt an enhancement of 20%.

Charge 1: sentence enhanced from 28 months to 33 months (enhancement of 5 months after rounding down from 33.6 months);

Charge 2: sentence enhanced from 24 months to 28 months (enhancement of 4 months after rounding down from 28.8 months); and

Charge 3: sentence enhanced from 40 months to 48 months (enhancement of 8 months).

The overall sentence of 4 years is enhanced to 57 months (rounded down from 57.6 months)  i.e. 4 years 9 months.

79.The Defendant is sentenced to 48 months’ imprisonment for Charge 3. I order that the sentences for Charges 1 and 2 to be served concurrently, but 9 months of which to be served consecutively to Charge 3; i.e. a total sentence of 57 months (4 years and 9 months).

80.The Defendant is currently serving a sentence of 45 months for one count of false imprisonment, one count of blackmail and 2 counts of theft (DCCC 824/2022). Those offences are wholly independent from the present offences. The sentences for the two cases should technically be wholly consecutive. After considering totality, I order that 8 months of the present sentence be served concurrently with DCCC 824/2022.