HKSAR v. Chan Ngan Ying and Others
Read the full judgment text of CACC 126/2002 on BabelCite. This Court of Appeal judgment.
1. The Applicants were the 6th defendant (D6), the 7th defendant (D7), the 13th defendant (D13) and the 14th defendant (D14) respectively at trial and it is by those designations that we refer to them throughout this judgement.
Cites 3 cases
|
CACC000126/2002 CACC 126/2002 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL CRIMINAL APPEAL NO. 126 OF 2002 (ON APPEAL FROM DCCC Nos. 13 of 2001 and 322 of 2001) ____________
____________ Coram: Hon Stock & Yeung JJA and Lugar-Mawson J in Court Date of Hearing: 9 March 2004 Date of Decision A1 & A2: 9 March 2004 Date of Handing Down of Judgment A1 & A2: 30 June 2004 Date of Judgment A3 & A4: 30 June 2004 _______________ J U D G M E N T _______________ Hon Lugar-Mawson J: (giving the judgment of the Court) Background 1.The Applicants were the 6th defendant (D6), the 7th defendant (D7), the 13th defendant (D13) and the 14th defendant (D14) respectively at trial and it is by those designations that we refer to them throughout this judgement. 2.On 9 March 2004 this Court dismissed D6 and D7's applications for leave to appeal against sentence and reserved our decision on D13 and D14's applications for leave to appeal against sentence. We now set out our reasons for our decision in respect of D6 and D7's applications and give our decision in respect of D13 and D14's applications. 3.The Applicants are four out of twenty defendants who were charged in various combinations with offences of conspiracy to defraud and theft in relation to the operations of four companies each of which purported to be involved in futures trading. The frauds were of the type known as 'Loco-London Gold or Loco-London Silver Frauds' in which gullible persons are induced to work for a fraudulent investment company where they are swindled out of substantial sums of money by false representations by the conspirators that their money has been invested and then lost in futures trading. 4.The trial was before Deputy Judge Thomas in the District Court. It lasted for nearly four months, starting on 19 October 2001 and ending on 21 February 2002. There were 18 offences of conspiracy to defraud and theft on the District Court charge sheet, however the prosecution elected not to proceed with Charges 6 to 15 inclusive. 5.D1, D2 and D10, who are brothers, absconded prior to trial and D17 absconded prior to the delivery of the verdict. The Judge, following the principles of R v. Jones [2002] 2 All ER 113 (HL), tried and sentenced them in absentia. 6.All the remaining defendants with the exception of D8, D9 and D16 pleaded not guilty. After trial, the Judge convicted D1 of charges 1, 2, 5, 16, 17 and 18; D2 of charges 1, 5, 16 to 18; D3 of charges 2, 5, 16, 17 and 18; D4 of charges 5, and 18; D5 of charge 5, D6 (the first Applicant) of charges 2, 5, 16 to 18; D7 (the second Applicant) of charges 1, 2, 5 and 18; D10 of charges 2 and 5; D11 of charge 5; D12 of charges, 1, 2 and 5; D13 (the third Applicant) of charges 2 and 5; D14 (the fourth Applicant) of charges 1 and 5; D15 of charge 2; D17 of charges 2, 5 and 16 to 18; D18, of charge 5 and D20 of charge 2. 7.D9 was acquitted of the charges she faced after the prosecution offered no evidence against her. She then gave evidence for the prosecution. D8 pleaded guilty to charges 2, 3, 5,16 to 18 and gave evidence for the prosecution. D16 pleaded guilty to charges 1 and 2 and gave evidence for the prosecution. D19 was acquitted of the charges he faced. 8.D6 was convicted of two charges of conspiracy to defraud, contrary to Common Law and punishable under section 159C(6) of the Crimes Ordinance, Cap 200 (charges 2 and 5) and three charges of theft, contrary to section 9 of the Theft Ordinance, Cap 210 (charges 16,17 and 18). She was sentenced to 4 years' imprisonment on each of charges 2, 5,16 to 18, with one year of the sentence on charge 5 ordered to run consecutively with charge 2 and charges 16 to 18 ordered to run concurrently with each other, of which 2 years was ordered to run consecutively to the sentences on charges 2 and 5. This resulted in a total term of imprisonment of 7 years. The Judge reduced that by one year to 6 years' imprisonment to reflect the fact that the major offenders could only be sentenced to 7 years' imprisonment because of the jurisdictional limit of the District Court. 9.D7 was convicted of three charges of conspiracy to defraud (charges 1,2 and 5) and one charge of theft (charge 18). She was acquitted of two charges of theft (charges 16 and 17). She was sentenced to 4 years' imprisonment on charges 1, 4, 5 and 18, with the sentences on charges 1 and 2 ordered to run concurrently with each other and with 2 years of the sentence on charge 5 ordered to run consecutively to the sentences on charges 1 and 2 and one year of the sentence on charge 18 ordered to run consecutively to the sentences on charges 1, 2 and 5. This resulted in a total term of imprisonment of 7 years. The Judge reduced that by one year to 6 years' imprisonment for the same reason that led him to reduce the totality of D6's sentences. 10.D13 was convicted of two charges of conspiracy to defraud (charges 2 and 5). She was sentenced to 4 years' imprisonment on each charge with 2 years of the sentence on charge 5 ordered to run consecutively to the sentence on charge 2, resulting in a total term of imprisonment of 6 years. 11.D14 was convicted of two charges of conspiracy to defraud (charges 1 and 5). She was acquitted after a successful no case to answer submission, of the other conspiracy to defraud charge, charge 2, and the 3 theft charges, charges 16, 17 and 18. She was sentenced to 4 years' imprisonment on charges 1 and 5, with 2 years of the sentence on charge 5 ordered to run consecutively to the sentence on charge 1, resulting in a total term of imprisonment of 6 years. The Charges 12.The conspiracy to defraud charged in charge 1 alleged that the named defendants between a day in March 1999 and 20 January 2000 conspired together and with other persons unknown:
13.Charges 2 and 5 were in exactly the same terms as charge 1, save that in charge 2 the alleged conspiracy was between a day in March 1998 and 20 January 2000, and in respect of a company called Honour Century Consultants Ltd. In charge 5, the alleged conspiracy was between a day in March 2000 and 26 May 2000, and in respect of a company called Victoria King Petroleum Development Ltd. 14.Charges 16, 17 and 18 were theft charges. The particulars alleged that the named defendants stole from one person, Lui Wai Kuen, in the case of charge 16 the sum of $500,000.00 on 21 June 2000; in the case of charge 17 the sum of $110,000.00 on 26 June 2000 and in the case of charge 18 the sum of $350,000.00 on 30 June 2000. Prosecution case 15.Two of the bogus companies, Stadium Consultants Ltd (Stadium) and Honour Century Consultants Ltd (Honour Century), purported to be in the business of Loco-London Silver. The other two bogus companies, Victoria King Petroleum Development Ltd (Victoria King) and Fortune Harbour Petroleum Development Ltd (Fortune Harbour), purported to be in the business of oil trading. All were registered companies; Stadium was a British Virgin Islands registered company. 16.It was the prosecution's case that none of the four companies had any legitimate purpose. They were set up by Tony Siu (D1), who was the mastermind of the scheme, for the sole purpose of cheating members of the public out of large sums of money. The victims were recruited through advertisements appearing in local newspapers offering attractive salaries for relatively straightforward clerical work in the companies. Once the victims had been offered employment, they were set to work doing meaningless office tasks and then deceived into paying money to the companies for apparent investment either into the Loco London Silver market (Stadium and Honour Century) or trading in oil futures (Victoria King and Fortune Harbour). No investments were made, the victims' payments going straight into the conspirators' pockets. The victims were then told that all their money had been lost in trading. They were then either sacked for incompetence, or left the company of their own accord. 17.The various conspirators played their own particular role in deceiving the victims and perpetrating the fraud. Some acted as 'supervisors' who purportedly held training courses for the victims. Some were 'special agents,' their job was to pose as new recruits to the company, befriend the victims, mollify their concerns and then induce them to 'invest' their money in the purported trading activities of the company. 18.Tony Siu stopped operating Stadium and Honour Century in January 2000 as a result of a police investigation into their operations. In late February 2000, he called a meeting of his fellow conspirators at Stadium's offices and announced that he was going to open a new business dealing in petroleum, which would be a 'legitimate' business. This new business was Victoria King, which commenced its business at the same offices Stadium had operated out of at Cameron Plaza in Tsim Sha Tsui. The offices were dolled-up with photographs of oil tankers and oil refineries and the conspirators scoured the Yellow Page Telephone Directories for names of companies engaged in the oil industry. They then used them to prepare a large number of impressive, but fraudulent, documents purporting to evidence the existence of flourishing petroleum futures investment company. Fortune Harbour was set up in April and May 2000, it too purported to invest in petroleum futures. Expert witnesses from the oil industry gave evidence that trading in petroleum futures could not be conducted in the manner Victoria King and Fortune Harbour claimed to operate. 19.A large number of victims gave evidence about the operations of each of the four fraudulent companies and the deceptions perpetrated on them. 20.The exact amount of money that the culprits gained from these scams is unknown, but the aggregate amount lost by the persons from who the police took witness statements is $31 million. D6 & D7's roles 21.D6 and D7 played a number of roles in each of the four fraudulent companies. Their activities spanned almost the whole period of the conspiracies charged against them. Both ran 'training courses' for new recruits at Stadium and Honour Century. Both induced victims to open accounts, by playing up the prospects of success in front of them, claiming to have opened trading accounts themselves and to have made a great deal of money through them. When victims hesitated in handing over money, D6 claimed that without making an 'investment' they would have no clients assigned to them and that there would be no other work for them to do. 22.Both bragged about the amount of money they had made. D6 flaunted a diamond ring and D7 a diamond watch, as a sign of the wealth they had amassed from trading. D7 claimed to one witness that she ran a Lexus car. And in the Victoria King scam represented to one witness that the minimum investment was $80,000.00. She was also seen to interview new recruits at Stadium. 23.Both pretended to be new recruits themselves and befriend new recruits. The role cynically described as that of 'special agent.' Both were required to report back to their fellow conspirators should a victim appear to harbour suspicions about the genuine nature of the company's business. D13's role 24.D13's roles were limited to Honour Century and Victoria King, where she played the part of a 'special agent.' She misrepresented to one victim that the company was prepared to advance her loans when she appeared to lose money. D14's role 25.D14's roles were limited to Stadium and Victoria King, where she too played the part of a 'special agent. One witness spoke of her pretending to have suspicions about the genuine nature of Stadium, but then resolving them and persuading the witness to make an investment. She told another witness that the minimum 'investment' in Victoria King was $80,000.00. The defence case 26.Few of the defendants elected to give evidence. D6 did, but the other three Applicants did not. The defence of all at trial appears to be that they too were victims and believed the companies to be running genuine trading activities. It was also said in mitigation that only Tony Sui appeared to benefit from the fraud, the four Applicants' reward being very small in comparison. Grounds of Appeal D6 & D7's grounds 27.Mr Edwin Choy for D6 & D7 argued two grounds of appeal on their behalf. First, that the Judge erred in adopting an aggregate starting point of 7 years' imprisonment for each of them, when the usual starting point for offences involving Loco London Gold/Silver fraud is only 4 years (the first ground). Secondly, that in reducing their sentences by only one year from a starting point of 7 years' imprisonment, the Judge failed to fully differentiate between their criminality and that of the main culprits, D1, D2 & D10. First ground 28.Mr Choy accepted, realistically, that the usual starting point for Loco London Gold/Silver Fraud offences is 4 years' imprisonment. In HKSAR v Chiang Chun Wai, CACC 11 of 2001 (unreported), this Court held that:
29.It was his argument that the Judge was wrong to regard the Stadium, Honour Century and Victoria King conspiracies as three entirely separate courses of criminal conduct, rather he should have regarded them as what he described as "transient manifestations of one bigger plot hatched by...Tony Sui", who was without doubt the mastermind behind the whole scam. By taking a 7 years' starting point for D6 & D7, the Judge had in effect increased the usual starting point of 4 years' imprisonment by 75%. 30.Mr Choy sought to derive a formula from the decision in Chiang Chun Wai. In that case this Court reduced the sentences for two of the appellants by 6 months from 3 years & 8 months' imprisonment to 3 years & 2 months' imprisonment, which is 16% of the total sentence, to reflect their limited participation in the fraud. Mr Choy argued that a factor of 16% should therefore be used to denote the disparity between the sentences imposed on those offenders whose participation in the fraud charged against them could be described as persistent with those whose participation could be described as limited. He accepted that D6 & D7's participation in the frauds in this case was persistent, which it clearly was, but argued that the enhancement of the starting point by reason of that should have been no more than 16% of the usual sentence of 4 years' imprisonment, which results in an overall sentence of around 4 1/2 years' imprisonment. 31.We agreed with Mr Kevin Zervos SC, for the Respondent that such a mathematical approach is misconceived. The real reason for the reduction given to the appellants in Chiang Chun Wai was because the starting point of 4 years' imprisonment imposed for the persistent offenders was inadequate. That much is clear from this Court's remarks at pp. 8S-9D of the judgment:
32.This Court went on to say, at p. 8K-R of the judgment in Chiang Chum Wai:
33.Those remarks make it clear that should a defendant engage in "...another identical scam", it is perfectly proper for the sentencing judge to impose a consecutive sentence, subject only to the application of the totality principle. 34.In this case, D6 & D7's participation the scams they involved themselves with lasted for around two years. Despite repeated police intervention, they remained active in them and carried on as if as if nothing had happened. After Stadium and Honour Century closed down following the police raids on Honour Century on 29 September 1999, they embarked upon another near identical scam with Victoria King. When the police raided Victoria King on 29 May 2000 they moved to yet another near identical scam with Fortune Harbour, where D6 committed the three thefts charged in charges 16 to 18 and D7 committed the theft charged in charge 18. As this Court observed in Chiang Chum Wai, at p. 8G-I, such contumacious behavior is "...to be directly equated with a further offence committed whilst on bail for which a consecutive sentence, in whole or in part, is generally imposed". The Judge was aware of this when he said in his reasons for sentence:
35.Given the depth of D6 & D7's highly proactive participation in the scams throughout those two years, an aggregate starting point of 7 years' imprisonment for each of them cannot be regarded as manifestly excessive. Second ground 36.Mr Choy's argument in advancing the second ground of appeal was that when one compares the culpability of the three masterminds, Tony Sui and his two brothers (D1, D2 & D10) with that of D6 & D7, the one year difference between the 7 years' imprisonment passed on Sui and his brothers and the 6 years' imprisonment passed on D6 & D7 is insufficient. 37.In this case the Judge addressed his mind to the differences in the roles and culpability of the masterminds compared to the roles and culpability of the other conspirators. He considered that the appropriate sentences for D1, D2 and D10 should have been 12 years, 10 years and 8 years respectively. However, as he was bound by the sentencing jurisdictional limit in the District Court of 7 years' imprisonment, he was constrained by law to impose that maximum sentence on each of them. This is in accordance with established principle. It does not mean, however, that he was as equally constrained to reduce the sentences for the other conspirators, whose sentences fell within his sentencing jurisdiction, by the same ratio. There can be no doubt that by reducing D6 & D7's sentences by one year the Judge had the sentences imposed on the three masterminds well in mind. 38.We have to say that we were very surprised indeed that the Respondent thought it proper to prosecute a Loco-London Gold/Silver Fraud of this magnitude in the District Court rather than the Court of First Instance of the High Court, especially in relation to the masterminds. 39.We were satisfied that D6 & D7's sentences were neither wrong in principle, nor manifestly excessive and dismissed their applications for leave to appeal against their sentences. D13 & D14's grounds 40.Mr Michael Delaney's sole ground of appeal on behalf of D13 and D14 is that the Judge failed to give them a discount of one year's imprisonment, which he gave to D6 & D7, as well as D3, D4, & D17, in order to distinguish the roles they played in the frauds from those of Tony Siu and his brothers. 41.After sentencing D1, D2 and D10 to 7 years' imprisonment, but before dealing with the remaining defendants, the Judge said:
42.In relation to D3, after commenting that had he been tried alone, or separately from the Siu brothers, he would have "richly deserve(d)" a sentence of 7 years' imprisonment, the Judge said:
43.When sentencing D4, who had been convicted of only two charges, charge 5 (Victoria King) and charge 18 (Fortune Harbour) and having considered that 4 years' imprisonment on each charge with 2 years to run concurrently was otherwise appropriate, the Judge said;
44.In sentencing D6, who it will be remembered was convicted of five charges, charges 2, 5, 16, 17 and 18 and D7, who was convicted of four charges, charges 1, 2, 5 and 18, to overall sentences of 6 years' imprisonment the Judge reduced overall sentences of 7 years' imprisonment to 6 years' imprisonment because of what he termed "the Siu factor". 45.Likewise D17, who was convicted of 5 charges, charges 2, 5, 16, 17 and 18, had an overall sentence of 7 years' imprisonment reduced to one of 6 years' imprisonment for "the Siu factor". 46.However, when it came to sentencing D13 and D14, inexplicably, the Judge said nothing about "the Siu factor". This meant that these two Applicants ended up with the same sentence for their two convictions as D3 who had five convictions, D10 who had five convictions, D6 who had five convictions, D7 who had four convictions, D12 who had three convictions and D17 who had five convictions. It also meant that they were sentenced to one year more than D4 who was sentenced to 5 years' imprisonment for 2 convictions, as we have said, D4 received the benefit of "the Siu factor". The Judge gave no explanation why he was not treating D13 and D14 in the same manner as the other defendants and giving them some benefit for "the Siu factor". 47.There is no doubt that the crimes D13 and D14 associated themselves with are very serious ones. As this Court recognised in Chiang Chun Wai, Loco-London Gold/Silver frauds are one of most heartless crimes of deception practiced in Hong Kong. They target ordinary members of the public and not, banks, or similar commercial organizations. They require a great deal of planning and considerable skill in execution. If successful, they run for a long time before being closed down. Indeed a well-executed one may escape police action altogether. They earn their perpetrators a great deal of money - a known $31 million in this case. They require a sizable number of willing conspirators to operate successfully and they corrupt those who are drawn in to work for them. 48.Each of them was involved in one of the two scams from the original Loco-London Silver fraud; D13 was convicted of the Honour Century conspiracy and D14 of the Stadium conspiracy. Each transferred their allegiance to Victoria King, the new scam involving oil futures. D13 was arrested at Honour Century in the 29 September 1999 police raid and spent 48 hours in police custody as a result of which she must have been aware of the fraudulent nature of the company she worked, and yet she chose to ignore that. D14 was arrested for the first time when the police raided Victoria King's premises on 29 May 2000. 49.D14 was 19 when she joined in the Honour Century conspiracy (she was 22 at the time of trial) and only participated in that scam for a few days before the police raid on 29 September 1999. She was with the Victoria King conspiracy from its inception in February 2000 to its closure by the police action on 29 May 2000. D14 was a married woman in her early 40's when she joined in the Stadium conspiracy in September 1999. She participated in that conspiracy for about four months before transferring to Victoria King, where she was for about 6 weeks before the police raid. The element of persistence referred to in Chiang Chum Wai is clearly present in both of their cases. 50.Set against that, the only roles the prosecution witnesses spoke of them playing within the fraudulent companies they were involved with was that of 'special agents' - the callous befrienders - and to that extent their roles were lesser than those of D6 and D7, both of whom were accomplished actresses playing many parts in the scams. It is the case, however, that Loco-London Gold/Silver frauds cannot work without 'special agents'; theirs' is one of the most important roles in these scams. 51.There is no doubt that the individual sentence of 4 years' imprisonment that they received for each of their offences is the correct sentence and Mr Delaney did not seek to argue otherwise. He also accepted that the Judge was correct in making the adjustments he did to D3, D4, D6, D7 & D17's Sentences. It is his argument that he erred in failing to reduce D13 and D14's sentences to reflect "the Siu factor" and that as a result there is a disparity in their sentences which this Court is entitled to consider and rectify. 52.Two situations commonly arise when there is a complaint of disparity in sentences. The first is when there is a disparity between sentences passed on the same occasion by the same judge. In this case the sentence should only be varied if it can be shown that the judge failed to apportion blame between the various defendant properly so that it can be said that, notwithstanding that the appellant's sentence is otherwise appropriate, it is so disparate when compared with the other sentences passed at the same time on his co-defendants as to engender a real sense of grievance on his part. The second is when different sentences are passed on different accused for the same offence or offences by different judges on different occasions. In this situation the only consideration is whether the sentence passed on the accused is proper: see R v. So Hung-lee and Another [1986] HKLR 1049 and R v. Lam Mo-kwong Cr App 175 of 1992 (unreported). 53.Roskill LJ in the English Court of Appeal said in R v. Stroud (1977) 65 Cr App R 150 that it had never been intended that a sentence should he reduced on account of disparity unless there was a glaring disparity which engendered a grievance. And Lawton LJ in R v. Fawcett (1983) 5Cr App R (S) 158 put the basis for an appellate court's intervention in a disparity argument as follows, at p. 161:
If the answer to that question is in the affirmative an appellate court will consider interfering, not necessarily because justice has not been done to a particular person, but because what has been done offends against the appearance of justice: see R v. Potter [1977] Crim LR 112. 54.In this case there were four other defendants, each convicted of a greater number of offences than D13 and D14, who each received the same overall sentence of 6 years' imprisonment that they did. The Judge set out to make a clear distinction in respect of culpability between all defendants. He did so in respect of some of them, but demonstrably failed to do so in respect of D13 and D14 and failed to provide an explanation why he did so. We agree with Mr Delaney that it cannot be argued that the other defendants received glaringly inadequate sentences and that the Applicants are not seeking to benefit from a windfall enjoyed by other defendants. Mr Delaney also accepted that the sentences passed on D13 and D14 would be proper, but for the obvious disparity. For our part we accept that this has engendered a real and legitimate sense of grievance in their minds and that Lawton LJ's commonsense test in Fawcett has been made out. 55.Accordingly, we grant D13 and D14 leave to appeal against sentence and allow their appeals. In exercise of our powers under s.83I(3) of the Criminal Procedure Ordinance, we quash the Judge's order that D13 serve 2 years of her sentence on charge 5 consecutively to the sentence on charge 2 and that D14 serve 2 years of her sentence on charge 5 consecutively to the sentence on charge 1 and instead order that D13 serve six months of her sentence on charge 5 consecutively to the sentence on charge 2 and that D14 serve six months of her sentence on charge 5 consecutively to the sentence on charge 1. This means that each will now serve a total of 4 years' and 6 months' imprisonment for their two offences.
Representation: Mr Kevin P Zervos, SC, SADPP and Ms Olivia Tsang, GC, for the Respondent Mr Edwin Choy, instructed by Messrs Quan & Co., for the 1st and 2nd Applicants Mr Michael Delaney, instructed by Director of Legal Aid, for the 3rd and 4th Applicants |
Cases cited in this judgment
Further hearings and rulings under CACC 126/2002