HKSAR v. Chu Kuk Ying and Another

DCCC 109/2022

[2023] HKDC 905

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 109 OF 2022

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REASONS FOR SENTENCE

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Introduction

1.There are altogether two defendants and five charges in the present case.

2.Charges 1 and 2 are conspiracy to deal with property known or believed to represent proceeds of an indictable offence, commonly known as money laundering, against both D1 and 2. 

3.Charges 3 to 5 are dealing with property known or believed to represent proceeds of an indictable offence contrary to section 25(1) and (3) of the Organized and Serious Crime Ordinance, Cap 455. 

4.D2 pleaded guilty to all five charges against him. 

5.D1 was convicted after trial in Charges 1 and 2.

Summary of the Charges

6.The particulars of the charges are summarized in the table below: - 

Charge	Defendant(s)	Period of Offence	Amount involved	Bank
1	D1 & D2	3.9.2014 – 13.9.2016	$1,224,700	D1’s HSBC
2	D1 & D2	3.9.2014 – 6.10.2016	$2,064,600	D1’s BOC
3	D2	19.9.2014 – 13.9.2016	$3,314,905	D2’s HSBC
4	D2	19.9.2014 – 13.9.2016	$7,163,260	D2’s BOC
5	D2	31.12.2015 – 13.9.2016	$431,600	D2’s HSBC

Summary of Facts

D1 – Charges 1 & 2

7.The facts and the evidence are all stated in the reasons for verdict and I shall not repeat it here again.  Shortly stated: -

(a) D1 and 2 were girlfriend and boyfriend who lived together prior to the arrest of D2 on 14 September 2016.

(b) D1 has two bank accounts as stated in Charges 1 and 2.

(c) In her admission in the record of interview, D1 stated that D2 asked her to provide the bank cards for him to use. D1 did.

(d) D1, in the record of interview, stated that she did odd jobs to make a living between $1,000 and $6,000 to $7,000 a month in either restaurants or mahjong parlours.

(e) She did not have any property or assets to justify the deposit into her accounts, which amounts to 1.2 million in Charge 1 and 2 million in Charge 2.

8.As to D2, the Summary of Facts stated that D2 was acquainted with D1.  D1 gave him the ATM cards of the bank accounts in Charges 1 and 2 to use. 

9.D2 was also the bank account holder of: -

(a) Charge 3: - HSBC account opened on 19 September 2014.

(b) Charge 4: - BOC account was opened on 19 September 2014.

(c) Charge 5: - HSBC integrated account and there was no information when it was opened.

10.The transaction patterns into all the five bank accounts showed that the accounts were being used as temporary repositories for funds, a total of about 13 million in five charges. 

Criminal Record

11.D1 has a clear record.

12.D2 has 10 previous criminal records since 1998 to 2017.  The last six criminal convictions from 2006 onwards are all drug-related offences: - 

(a) In 2006, three convictions of possession of dangerous drugs.

(b) In 2008, trafficking dangerous drugs, he was sentenced to 4 years 2 months.

(c) In 2011, trafficking dangerous drugs, he was sentenced to 5 years 4 months.

(d) In November 2017, he was sentenced to 12 years for trafficking dangerous drugs.

Background of the defendants

13.D1 is 53 years old.  She settled in Hong Kong in 1999.  She is previously divorced but remarried again in September 2022.  She has an adult son from her first marriage who is now 27 years old. 

14.D1 said that she has been under immense psychological pressure.  She is very remorseful.  It is a one-off event and she will not commit any further offences.  She is worried that once she is sent to a prison term, there will be no one to look after her 27‑year-old son.  Since her arrest, she has not been back to China to visit her family. 

15.I also have opportunity to read all the mitigating letters from her family members and friends. 

16.As to D2, he is 41 years old.  D1 was his girlfriend then.  He previously worked as a construction site worker earning about $20,000 per month. 

17.D2 is now engaged in religious classes in prison.  Upon self-reflection of his past behaviour and the impact on society, he wishes to make positive contributions back to the society upon his release from prison.  The letters from the church also tells me the same thing. 

Sentence

18.The maximum sentence for section 25 offence on conviction upon indictment is a fine of $5 million and imprisonment for 14 years.  The maximum sentence for the conspiracy charges is also the same. 

19.In the case of HKSAR v Boma Amaso [2012] 2 HKLRD 33, it laid down various factors to be taken into account when sentencing money laundering cases: -

(1) the amount of money laundered;

(2) nature and penalty of the predicate offence;

(3) knowledge of the offender as to the nature of the predicate offence;

(4) whether there was an international element;

(5) whether benefit has been received;

(6) length of time the offence was committed;

(7) role of offender and acts performed by the defendant;

(8) whether the person who dealt with the funds was fully aware, reckless or negligent that the money was proceeds of an indictable offence;

(9) the sophistication of the offence, including degree of planning and deceit;

(10) whether an organised criminal syndicate was involved.

20.In the same judgment at paragraph 36, it also states that:-

“The sentencing court must have regard is the fact that in this category of offence, deterrence is paramount. It is to be remembered that ‘the criminality in laundering arises from the encouragement and nourishment it gives to the crime in general. Without it, many crimes would be rendered much less fruitful and perhaps more difficult to perpetrate’.”

21.As said in many cases, the amount of money laundered is a significant factor in determining the sentence.  In HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545, Cheung JA set out the amount of money involved and sentences passed in a number of money laundering cases.  The starting point is 3 years or so where the “black money” involved is between 1 million and 2 million, 4 years or so where it is between 3 million and 6 million, and it could be over 5 years where it is about 10 million. 

22.The defence for D2 also cited 香港特別行政區 訴 潘靜侃及另一人 [2022] HKDC 618 to illustrate the fact that there are no sentencing guidelines for the offence of section 25 because the facts vary from case to case. 

23.In the present case, the period for the five charges last for a total of about two years.  I accept that there was no evidence to suggest any criminal syndicate behind the offence in D1’s case, or any sign of international element in both D1 and D2’s case. 

24.In D1’s case, she has no property or asset.  She never needed to pay tax during the period of offence because she worked as an odd-job worker in restaurants or mahjong parlour, earning a very small sum per month.  Her role was limited to lending her bank cards in Charges 1 and 2 to D2.  She also admitted dealings with part of the funds during cross‑examination, albeit I rejected her reason for dealing with the funds as a loan, as a winning from gambling, as a salary tipping from her jobs in a nightclub. 

25.She claimed she did not know the source of the funds.  She said that D2 would give her $10,000 as living allowance so that she was not required to work again. 

26.Her conviction was based on having reasonable ground to believe. 

27.As to D2, he used five accounts to launder about 13 million within a period of two years. 

28.There are aggravating factors in his case.  He was serving a sentence between January 2011 to 3 September 2014 for an offence of trafficking dangerous drugs. 

29.In charges 1 and 2, the offence date commenced on the date that he was released from prison.  About two weeks after his release from prison, he opened the bank accounts in Charges 3 and 4 with two different banks.  He stated that he was unemployed at that time. 

30.I consider that this is an aggravating factor as he clearly had planned and lined up with a criminal syndicate during his time in prison to commit these five offences.  The offence date ended on 13 September 2016 for Charges 1, 3 to 5, as D2 was arrested on 14 September 2016. 

31.He is now serving a sentence for an offence of trafficking dangerous drugs for 12 years.  The sentence was imposed on him in November 2017. However, in the Summary of Facts for D2 and the trial for D1, there was no evidence to suggest that D2 was arrested for the offence of trafficking in dangerous drugs.  It was only revealed in his criminal record. 

32.I consider that his sentence should be enhanced by 6 months in each charge as the sentences should carry a deterrent effect.  I also consider that the culpability of D2 in the present case is more serious than D1. 

33.The defence in mitigation asked this court to consider that both defendants have waited for 3½ years to know the outcome of the sentence.  The defence do not suggest that it amounts to delay in prosecution.  Rather, it was the length of time have imposed mental pressure on them, especially D1 who has a clear record. 

34.She has remarried 9 months ago.  From all these letters from D1’s husband, relatives, colleagues and her son, I come to know that it has been a huge pressure weighing on her that there were times she wanted to commit suicide. 

35.As to D2, he has been to prison since the age of 23.  Prison life is nothing new to him.  When he was charged for the present offence, he was already subject to 12 years’ imprisonment.  To this end, I consider that a 3-month deduction for D1 is appropriate.  I grant D2 a 1-month deduction only.

36.On a different note, D1’s counsel Mr Boyton suggests that I should exercise my discretion to further reduce the sentence of D1 on the ground of close relationship with D2. 

37.I disagree. 

38.When she provided the two ATM cards to D2, she did not ask for reason why he needed the two bank cards because she has two failed marriages.  She learnt from experience that she was too controlling and that caused the breakdown of the two marriages. 

39.In my verdict, I also expressed my view that during the period of money laundering, she and her second husband has not yet divorced.  She was only married in November 2013.  The date of offence in Charge 1 and 2 both began in early September 2014. 

40.She was just married for less than a year and claimed that D2 moved in to live with her.  Her second marriage was only dissolved in 2020.  I certainly do not know that D1 remarried in 2022 as she did not say it in her evidence.  I do not wish to comment on this point, as this is a defence tactic in D1’s defence. 

41.Nonetheless, Mr Boyton agreed during mitigation that the relationship between D1 and 2 who conspired with her to launder the black money should not be featured as a mitigating factor in sentencing unless D1 was subject to or under the influence close to that.  My assessment of the evidence was that D2 had not exerted pressure on D1 to provide the two ATM cards. 

42.As to D1’s adult child who is now about 27 years old, according to D1, he works and also contributes living allowances to her.  He is not a young child anymore.  There is simply no further ground to justify any reasons for deduction of sentence. 

43.To this end, the sentence for D1 in Charges 1 and 2 is 18 months.  I order 8 months in Charge 2 to run consecutively to Charge 1.  It arrives at a total of 26 months and after deducting 3 months, it becomes 23 months for D1. 

44.As to D2: -

(a) Charges 1 and 2: - The starting points are 2 years. After one-third, it becomes 16 months.

(b) Charge 3: - 3 years, reduced to 2 years.

(c) Charge 4: - Starting point 5 years, after one- third discount it becomes 40 months.

(d) Charge 5: - Starting point 1 year, after one-third it becomes 8 months.

45.And finally, it remains the issue of totality.  I consider that a sentence of 66 months is appropriate in the case of D2.  To achieve that, I order 8 months from each charge of Charges 1, 2, 3, a total of 24 months to run consecutively to Charge 4.  And as to Charge 5, I order 2 months to run consecutively to Charge 4. 

46.The total is 66 months’ imprisonment.  After deducting 1 month, it arrives at 65 months.  I order 5 months to run consecutively to HC 295/17.