HKSAR v. Wong Hong Leung

DCCC 505/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 505 OF 2008

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Before:  Deputy District Judge Eddie Yip

Date: 30 April 2009 at 9:21am

Present: Mr. Jonathan E. Acton-Bond, Counsel on Fiat for HKSAR

Mr. Bruce Tse & Ms. Anita Wong,  instructed by M/S M.K. Lam & Co., for defendant

Charges: 1-4) Offering advantages to an agent (向代理人提供利益)

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REASONS FOR SENTENCE

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The charges and facts

1.The Defendant is convicted after trial of 4 charges of offering advantages to an agent, contrary to section 9(2)(a) of the Prevention of Bribery Ordinance, Cap. 201.  The prosecution case is that he has bribed 2 agents, Leung Tit-ming (“Leung”) and Lin Tak-fai (“Lin”) of the same company.  I shall refer to them as “the Duo”.  The Duo’s company has changed its name from Arco Toys Limited (“Arco”) to Mattel Asia Pacific Sourcing Limited (“Mattel”) during the material period.   The Duo were the directors of the product sourcing department of Arco or Mattel, as the case may be.  The charges can be described as follows:

Charge	Agent	Company	Period
1	Leung	Arco	1 Jan. 1998 to 31 December 1999
2	Leung	Mattel	1 Jan. 2000 to 30 November 2003
3	Lin	Arco	1 Jan. 1998 to 31 December 1999
4	Lin	Mattel	1 Jan. 2000 to 31 March 2003

2.The exact total sum that he had offered to the Duo cannot be ascertained although it is known to be a part of sum slightly over $15 million for the entire period from 1 January 1998 to 30 November 2003.  The bribes were paid on a monthly basis to the Duo with a view that the Duo, acting for and on behalf of Arco or Mattel, would place purchase orders with Fook Key. 

3.The bribes were obtained from Fook Key as the purported payment for goods supplied by a company, Ko Wah Company, which no longer existed.  It was out of purported payments to Ko Wah that the Defendant paid out the bribes.  Although the exact amount of bribes was unknown, I am satisfied that it should form a considerable part of such payments.  According to the Defendant in VIR 1:

(1)  “Had it ever been a hundred thousand or eighty thousand?  I suppose it did happen ……” [# 626 – 630];

(2)  “Well, who was responsible for making a calculation of the two percent?  I did it myself, …… I myself, it was because, regarding the business turnover I achieved in a month, …… it was just roughly; actually it would not be very exact [# 709 – 712];

(3)  “Part of it was given to ah Mr. LIN and Mr. LEUNG.  Yes.  And part of it was used for entertainments.  Yes, yes, yes.  That is, the entertainments in relation to business affairs.  Yes, yes, yes [# 815 – 820];

(4)  “Well, that means, if, (we) can work out the sum, that is to say, the orders from Mattel in that year, two percent of the total was in fact supposed to be given to them as a rebate, it would be rather close to that amount.  This was, was, I suppose it was like that when they were in service [# 1881 – 1882];

(5)  How about Mattel?  What was the proportion regarding Mattel?  Mattel was our major client.  I suppose it was some 70 to 80 percent [# 1205 – 1208].

4.Whether authorized by their companies or not, there were a number of people like LIN and LEUNG to which the Defendant had to give rebate.   Arco or Mattel was Fook Key’s major client, which accounted for 70 – 80% of Fook Key’s sales turnover.  Fook Key had made payments of $15,640,537.50 in total to Ko Wah.  Hence, 70% of $15,640,537.50 would be $10,948,376.25. 

Sentencing corruption cases under s. 9

5.There are no sentencing guidelines.  The customary sentence has consistently been imprisonment since Attorney General v Shamsudin [1987] HKLR 826.  In that case, Cons VP observed that: 

Sentences cannot be brought below a level which will afford some deterrent against crime and, where substantial fraud or corruption is concerned, preserve the integrity of Hong Kong’s commercial reputation.  (at 832 G)

The Defendant’s personal circumstances

6.The Defendant is now 71 years old.  He was born in Chiu Chow, China.  He was educated up to primary level.  He started to work at odd jobs.  In 1967 he established Fook Key.  Fook Key had become an immensely successful enterprise over the years.  He has 6 sons, all having received university education.  He lives with his wife.  

7.On 6 March 1998, he was appointed to be a committee member of the Chinese People’s Political Consultative Conference in Chaozhou,Guangdong Province.  On 18 March 1998, he was appointed to be the Chairman of the Board of the Hong Kong & Kowloon Plastic Products Merchants United Associated Limited.  On 10 November 2006, he was appointed to be a committee member of the Chinese People’s Political Consultative Conference in Raoping County, Guangdong Province. 

The sentence I pass

8.The Defendant used Ko Wah as a dishonest means to fund the bribes.  This scheme persisted on a monthly basis from 1 January 1998 to 30 November 2003 (in the case of Leung) and to 31 March 2003 (in the case of Lin).  This element of pre-meditation and planning went to the core of culpability in the present case.  The sum of bribes in itself, which is not ascertainable for a certainty but apparently not a nominal figure, would be an insignificant element in the sentencing of the Defendant. 

9.I take 20 months as the starting point for each charge.  I give a discount of 2 months in view of the Defendant’s clear record, age, and contribution to the community.  There are no other mitigating factors.  The sentence is 18 months for each charge.  They are to run concurrently.