HKSAR v. Bin Kei Chi and Another

CACC 181/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

criminal APPEAL NO. 181 OF 2005

(ON APPEAL FROM DCCC NO. 1425 of 2004)

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BETWEEN

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Before: Hon Ma CJHC, Stuart-Moore VP and McMahon J

Date of Hearing: 23 September 2005

Date of Judgment: 23 September 2005

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J U D G M E N T

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Stuart-Moore, VP (giving the judgment of the Court):

Background

1.On 14 April 2005, the applicants (D1 & D2) pleaded guilty in the District Court before Deputy Judge Mierczak to possessing false instruments with intent, contrary to section 75(1) of the Crimes Ordinance, Cap. 200 (Charge 1).  Additionally, D1 pleaded guilty to the possession of a false travel document, contrary to section 42(2)(c)(i) & (4) of the Immigration Ordinance, Cap. 115.  D1 was sentenced on the 1^st charge to 3 years and 8 months and on the 2^nd charge to 8 months’ imprisonment, with 4 months of this term ordered to run consecutively, making 4 years in all.  Some of the mitigation which was applicable to D1 did not apply to D2 who received a sentence of 4 years’ imprisonment on the 1^st charge.  They each now seek leave to appeal against sentence.

2.In brief, the facts were that on 11 October 2004, D2 used cash to purchase air tickets for himself and D1 to go to Seoul on separate flights on the following day.  On 12 October 2004, police watched D1 checking in for his flight.  In doing so, he passed over a suitcase at the Korean Air desk.  He was followed into the airport departure hall where he was seen meeting D2.  As they later made their way to their respective departure gates they were arrested.

3.Prior to the arrests, police had searched D1’s suitcase.  Inside, they found 10 MasterCards (3 of which were gold cards) and 15 Visa cards (of which 7 were gold cards), all on different accounts.  Their suspicion that these were counterfeit was later confirmed.  All of the credit cards were in the name of Luk Man Bin, which was the same as the name appearing inside an Indonesian passport bearing what appeared to be D1’s photograph which was also found inside the suitcase.  The passport was also a forgery. 

4.When D2 was arrested he was found to be in possession of a piece of paper bearing the numbers, written in Arabic, of the credit cards found in D1’s luggage.  The Summary of Facts, which was agreed by both applicants in the lower court, contained an acceptance that they were jointly in possession of the suitcase containing the 25 counterfeit credit cards which they knew to be false and with the intention that they or others would use them fraudulently. 

Sentencing

5.The judge took a 6-year starting point on the 1^st charge having taken into account the factors to be considered in cases of this kind, as set out by this court in R v Chan Sui-to & Anor [1996] 2 HKCLR 128.  In that case, where the 1^st appellant was arrested after he had emerged from premises described as a ‘factory’, he had on him 4 counterfeit credit cards, 23 false Telecom phonecards and a false identity card.  Inside the factory, police found an encoder, an embosser & other machinery associated with the manufacture of false credit cards of which 43 were found together with a further 23 false phonecards.  The 1^st appellant was found by the sentencing judge to have been “directly involved in the running of the credit card factory” and he reduced the overall starting point he had taken to 6 years’ imprisonment to reflect the pleas of guilty.  There was a 2^nd appellant who Yang CJ described as “merely a courier of counterfeit credit cards”.  This description was no doubt to distinguish her from her far more deeply involved accomplice.  The 2^nd appellant had, it seems, allowed the 1^st appellant to influence her into making dishonest purchases with a false credit card, but she had known about the 1^st appellant’s “role in running the factory”.  In her case, for these offences and others in connection with the use of a false identity card, the judge sentenced her to 3 years and 3 months after taking into account the mitigation, including her pleas of guilty.  The court (at page 131) held that a sentencing judge would need to consider 5 factors before deciding the level of sentence, although Yang CJ went on later to say that this was not intended to be an exhaustive list.  These factors were as follows: 

“	1.	The size of the operation e.g. whether it involves large sums of money, whether it concerned a large number of persons or forged credit cards.
	2.	The planning that has gone into perpetrating the fraud, whether it is elaborate or simple, whether technical skills were used, and to what extent.
	3.	Whether there is an international dimension.
	4.	Whether the accused played a major role, e.g. running a syndicate, engaging in actual manufacture, organising the use of forged cards, or whether he is a mere ‘cog in the wheel’ as a courier or a custodian or keeper.
	5.	Whether there is a plea of guilty.
	In considering whether large sums of money were involved, we would suggest that, at the present cost of living, amounts up to $50,000 may be considered relatively small, amounts from $50,000 to $150,000 medium, and amounts above that may be considered large.”

6.The court in Chan Sui-to and Anor then looked at a number of earlier judgments in similar cases before going on (at page 134) to say:

“Allowing for the different facts and the varying degrees of culpability, it is impossible to formulate a set of principles of sentencing from those decisions.  We think however it would be helpful to the courts if they were guided by some criterion.  We would therefore suggest that an accused who plays an active but not necessarily a key role in a medium size operation involving between $50,000 and $150,000, with no elaborate planning and equipment, and without an international dimension, should receive a sentence of five to six years after trial.  Sentences may be adjusted upwards or downwards according to circumstances.

The sum of money involved is of course only one of the factors to be taken into account.  It is not even the most significant factor.

We would say that D1 was operating a medium size operation.

D2’s conduct was not essential to D1’s operation.  Her criminality was therefore less serious.

Applying our guideline, we think the totality of the sentences on D1 should be four years before plea.  D2’s conduct was not essential to D1’s criminal enterprise.  Her culpability was less serious.  The totality of sentences on D2 should be three years before plea.”

7.With these considerations in mind, the judge in the matter presently before us, observed that the operation could not be regarded as small in view of the number of counterfeit credit cards recovered.  Furthermore, this case had an obvious international dimension.  The judge described the potential for fraud as “very extensive indeed” pointing out the fact that no actual loss had yet been suffered by anyone was the result of the early apprehension of the miscreants.  In saying this, the judge bore in mind what was said by Mayo V-P in HKSAR v Ng Swee Thiam & Ors [2000] 1 HKLRD 772 at 778, namely that:

“The question of the amount of losses which may be proved may pale into insignificance when consideration is given to the potential for losses in the future. …

It is this potential for losses which is the most important consideration.  It may well be the case that it is not a simple matter to lay down any hard and fast rule of thumb in determining appropriate sentences in individual cases.”

The judge in the present case then commented:

“

11.

One can just imagine if all the credit cards had been used in Hong Kong or elsewhere the potential for losses would be staggering.  It must be in the region of several hundreds of thousands of dollars.”  (Appeal bundle pp. 12-13)

The application

8.Mr Stirling, on D1’s behalf, submitted that the starting point of 6 years’ imprisonment in respect of the 1^st charge, and the total sentence on charges 1 and 2 of 4 years’ imprisonment after plea, was manifestly excessive.  In a further ground of appeal, it was contended that:

“Having regard to the role of the 1^st [applicant] as a courier and there being no evidence as to how and where the forged credit cards and passport came to be produced, and there being no evidence of the scale of the operation and there being no evidence as to the potential, if any, for future losses there was no basis for the learned trial judge to find that ‘the size of the operation cannot be regarded as small’ and no basis for him to find that potential losses ‘must be in the region of several hundreds of thousands of dollars.’”

9.We can deal with these grounds together as they are closely related.  Mr Stirling’s main point was that as D1 was being regarded as a courier, and as there was no specific evidence about the potential losses that may have been incurred, there was really no evidence beyond the fact that 25 counterfeit credit cards were found to suggest that this was more than a “small operation”.  With respect, we disagree.  There was an abundance of material from which the judge was able to draw the inference that this was not a small operation.  Plainly, the applicants were working as a two-man team.  They had gone to the trouble of taking separate flights to Korea and it is obvious that they were hoping to profit in a considerable way from their joint expedition.  As the judge stated in his Reasons for Sentence, D1’s mitigation included an acknowledgment that D1 intended to go abroad in order to purchase items with the credit cards.  The judge was quite entitled, as a matter of common sense, to draw his own conclusions about the viability of the counterfeit credit cards found in the luggage and the extent to which they were likely to be used.

10.In Attorney General v Chan Piu-sang & Anor [1994] 1 HKCLR 211 which was concerned with the possession & use of forged credit cards and was also referred to by the judge in the present proceedings, Silke V-P (at page 214) said:

“This court has emphasized on more than one occasion the serious nature of this type of offence.  As was said by Macdougall, J.A. (as he then was) in R v Wong Fu-keung, Criminal Appeal No. 5 of 1991 (unreported) at page 5:

‘It is a notorious fact that the illegal use of credit cards has become widespread.  Those who are engaged in this type of activity can expect to be dealt with severely by the courts.’

As my brother Litton, J.A. said in R v Kwai Ying-ho, Criminal Appeal No. 527 of 1992 (unreported) at page 5:

‘Credit card frauds have in recent years been an insidious poison in the community.  It affects a large number of citizens.  It erodes the credit card system and damages Hong Kong’s standing in the international community.’

While those latter words were applied to charges of conspiracy, we would, with respect, adopt them in this court in relation to the generality of credit card frauds.”

These sentiments are in our judgment as valid today as they were when they were uttered over a decade ago.

11.A further point was made by Mr Stirling in the course of his argument with which we shall deal despite the fact that there was no specific ground of appeal in regard to it.  He submitted that whilst the 12-month starting point adopted in D1’s case on the 2^nd charge was appropriate, it was wrong for the judge to have considered this charge as “a separate and distinct offence”.  In such circumstances, as the false passport was part and parcel of the scheme covered by the 1^st charge, he argued that the sentence on the 2^nd charge should have been ordered to run wholly concurrently.

12.If the point had any substance it would, of course, as a matter of principle, have to be put right but the possession of a false travel document does have an additional dimension beyond that which was taken into account in sentencing D1 on the 1^st charge.  Plainly, however, the principal intention was to use the forged passport to provide support for D1’s identity should he be challenged when presenting a false credit card bearing the same name.  As such, the judge was entitled to look at the overall criminality revealed by both charges and impose, as he did, a sentence which reflected this.

13.We may say, in passing, that in fact the judge gave a small discount to D1 in view of his “clear record … as well as the fact that he had furnished a non-prejudicial statement to the police”.  As to D1’s statement to the police, the judge indicated that the police had not made use of it at the time when sentence was imposed, so that this was not, with respect, a proper basis for reducing sentence.  Mr Stirling very properly accepted, having seen the statement, that it contained nothing which could be of material assistance to the authorities. 

14.We take this opportunity to emphasise once more, in the interests of parity in sentencing policy, that co-operation after arrest, where meaningful assistance provided has led to a tangible result, is rewarded by the courts but either an unfulfilled promise or an attempt to assist which is of no significant practical value at the sentencing stage does not carry with it the prospect of a reduced sentence.  If the situation should later change, the Court of Appeal or, as the case may be, the Executive will be in a position then to deal with the matter.  A clear line has to be drawn and it seems that D1 was the beneficiary of a discount to which he had no entitlement. 

15.D2, who is not represented, made a number of points.  These include the fact that his criminal record does not contain an offence of the kind with which we are presently concerned.  This, however, was remarked upon by the judge and had certainly not escaped his attention.  D2 next put forward the suggestion that because he had only been employed to work for D1 “to transport the goods & bring the goods back to Hong Kong”, he had played a smaller role which called for a lower sentence.  As to this, we consider that the judge was right to have sentenced both applicants equally.  No doubt they had different roles to play in the fraudulent conduct they intended to embark upon in Korea before returning to Hong Kong with their ill-gotten gains, but each of them was important to the operation and in our view each deserved an equal sentence.

Conclusion

16.We have found no merit in the applications which have been advanced.  Accordingly, both applications are dismissed.

Mr P S Chapman, SADPP, of the Department of Justice, for the Respondent.

Mr W N C Stirling, instructed by Messrs Kong & Associates, for the 1^st Applicant (D1).

The 2^nd Applicant (D2), in person .