HKSAR v. Chan Wing Hong and Others

DCCC997/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 997 OF 2011

----------------------

---------------------

Reasons for Sentence

---------------------

1.D1 pleaded guilty to Charges 1 and 3, D2 pleaded guilty to Charge 3 and D3 pleaded guilty to Charge 4. D1 pleaded not guilty to Charge 2 and this charge is now left on court’s file not to be proceeded with without the leave of the court.

Facts of the case

2.On 28 March 2011, PW1 was assigned to act as an undercover to meet D1 in Mongkok.  D1 offered to sell counterfeit credit cards to PW1 with the following terms:

(i) D1 sold each counterfeit credit cards for $3,000;

(ii) PW1 should report to D1 the first six digits of the counterfeit credit cards upon receiving them and the total amount of the transactions in a day;

(iii) one telephone number of D1 was for PW1 to make purchase of the counterfeit card. The other telephone number of D1 was for PW1 to send the names to him.

3.On 30 March 2011, PW1 agreed to buy 2 counterfeit cards from D1 for $6,000.  PW1 paid D1 a deposit of $1,500, PW1 wrote down a name Hui Wai-yee on D1’s notebook.

4.On 1 April 2011, D1 told PW1 that the cards had been placed under a litter bin inside a toilet in Pioneer Centre, Mongkok.  On the same day, PW2 found 2 counterfeit credit cards in the name of Hui Wai-yee under a rubbish bin.  PW1, then paid the balance of $4,500 to D1. 

5.Later on the same day, PW1 called D1 and told him the first six digits of cards 1 and 2. 

6.On 2 April 2011, PW1 lied to D1 that the transactions for the two cards amounted to $30,000. 

7.On 17 June 2011, PW1 met D1 again in Mongkok.  D1 asked PW1 to buy some more cards as the counterfeit credit cards were of better quality. 

8.On 21 June 2011, PW1 agreed to purchase 42 cards from D1.

9.On 26 June 2011, PW1 sent the 10 names for the 42 cards to D1’s mobile number.  Later that day D1 informed PW1 that he could only provide 30 cards to him and asked for a $10,000 deposit.  After a negotiation, D1 agreed at $5,000.

10.$5,000 police marked money were also prepared to pay D1.

11.On 28 June 2011, D1 led PW1 to meet D2.  D2 claimed to work for the supplier of the counterfeit cards.  PW1 paid the marked money to D2 as deposit.  D2 also wrote down the names of the purported counterfeit card users.

12.On 28 June 2011, the police arranged a hotel room to collect the counterfeit cards. 

13.When PW1 met D1, they agreed to send their respective agents to meet inside the room for the transfer of the counterfeit credit cards. 

14.Later that day, D1 met PW1 again.  PW1 told D1 that the transaction would take place in another hotel and that was Room 1058.

15.At about 8 pm that day, D3 arrived at Room 1058 to meet PW4.  D3 handed 30 counterfeit credit cards to PW4, who then arrested D3. 

16.Subsequently, D1 was arrested by PW3.  Under caution, D1 said that he obtained the cards from a supplier and sold to PW1 to earn the difference.

17.When D2 was arrested, part of the marked money was recovered from him.  Under caution, D2 admitted that :-

(i) his boss asked him to collect $45,000 from D1 as the payment for the counterfeit cards;

(ii) he collected $5,000 deposit from PW1;

(iii) D1 gave him the name of the cardholders.

18.As to D3, he admitted under caution :-

(i) he was told by his boss to deliver the cards to a hotel room and;

(ii) he would receive $800 as reward;

(iii) on 28 June 2011, his boss asked him to collect the counterfeit cards inside a toilet.

Criminal Records :-

19.(i)    D1, he has a clear record.  

(ii) D2, he has 19 previous convictions between 1983 to 2007: three were gambling, one was theft and 13 were obtaining pecuniary advantage by deception in one case.

(iii) D3, six previous convictions between 1997 to 2010. They were theft, claiming triad membership, possession of dangerous drugs, possession of offensive weapons and attempted robbery.

20.D1 is 33 years of age, has a 9 year old son who is now living with his ex-wife.  D1’s parents are in their 70s.  D1 committed the present offence out of financial difficulties.  He used to work as a chef but due to his back problem he lost his job as a chef.  His ex-wife and all his relatives wrote to this court to ask for a lenient sentence on his behalf. 

21.D2, 47, single.  His parents are also in their 70s.  He committed the present offence because of his $30,000 gambling debt.  He used to work as a waiter, earned about $7,500 to $8,000 per month.                      

22.D3, 31, he lives with his father, uncle and aunt. His daughter is 12 years old.  His wife had left him with their 1½ year old son. He used to be a construction site worker but was unemployed at the time of the offence.  His family is now subject to evacuation because of their failure to pay rent to the Housing Department. 

23.In passing sentence, I have regard to the case of Chan Sui To [1996] 2 HKCLR 128.  The court laid down guidelines for sentencing the fraudulent use of credit cards.  There are a number of factors need to be considered:

(i) size of the operation such as whether it involved large sums of money;

(ii) whether it concerned a large number of persons or forged credit cards;

(iii) the planning that has gone into perpetrating the fraud or whether it is elaborate or simple; whether technical skills were used and to what extent; whether there is an international dimension, whether the accused played a major role, whether there is a plea of guilty.

24.In the present case, all the three defendants each of them have their own role to play in the scheme.  Right from the start, D1 knew that it was an illegal business to be involved in the selling of the counterfeit credit cards.  D1 was careful in his planning, that it was always another person to pass on the credit cards to PW1.

25.In Charge 1, the two counterfeit credit cards were hidden inside a public toilet in the Pioneer Centre.  D1 asked PW1 to send someone to collect the two cards.  As to Charge 2, to send a third party to deliver the 30 counterfeit cards in a hotel room and that was D3.

26.On the face of it, he stayed away from the actual handling of the cards.  D1 also cared about the subsequent handling of the cards by PW1, who only lied to him about the details, such as $30,000 transaction in a day by using the two false credit cards.  He then went on to tout PW1 for the second purchase of the cards.  That involved 30 false credit cards which was a substantial number.  It was because D1 knew that the first two cards could be used and there was a successful transaction of at least $30,000.

27.It showed that D1 actively participated in selling of those false credit cards.  Each card was sold for $3,000, 30 cards could sell for $90,000.  It was a very lucrative business to sell the fake credit cards at such a high price, the defendants should all had the expectation that the 30 cards could be used to make purchases.        

28.With all the 30 credit cards circulating in the shops and restaurants, the resulting loss to the business enterprises could be very serious.  There would also be a substantial loss to the bank.  On the other hand, these counterfeit card users have no financial liability to pay.

29.D1 said that he only acted as a middleman to make a profit.  D2 said that he was responsible to collect the outstanding sum from PW1.  D3 was the courier to deliver the 30 credit cards and he was promised with an $800 reward.   

30.Without the participation of the three defendants, there would not be a successful selling and buying of the false credit cards.  However, it was not difficult to imagine that there must still be someone at the back scene not yet arrested.  It definitely must be more than three defendants in the scheme.  It was a very well planned and very well organised scheme. 

31.All the defendants indeed participated in a very serious crime.  This court will not take a lenient approach in sentencing the defendants.  As said in AG v Chan Piu Seng and Another [1994] 1 HKCLR 211, which was concerned with the possession and used of forged credit cards, at page 214 the court said:

“This court has emphasised on more than one occasion the serious nature of this type of offence.”

32.As was said by Macdougall JA, as he then was in the R v Wong Fu Keung CACC 5/1991 (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.”

33.In another case, R v Kwai Ying Ho CACC527/1992 (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.”

34.The Court of Appeal in HKSAR v Bin Kei Chi and Another CACC181/2005 said that:

“This view was applicable in 2005 but in fact is still applicable today in 2011”.

To this end, I disagree with the defence that the starting point for Charges 3 and 4 should be 3 years.

35.Having heard the mitigation and considered all the authorities before me, I order:-

D1	Charge 1	Starting point 3 years reduced to 2 years
D1 and D2	Charge 3	Starting point 4 years reduced to 2 years and 8 months As to D1, one year in charge 3 to be run consecutively to charge 1. D1’s total sentence is 3 years.
D3	Charge 4	Starting point 4 years reduced to 2 years and 8 months

36.Lastly, I ask the probation officer to visit the three defendants’ families to ascertain what the Social Welfare Department can offer to help these three families.