HKSAR v. Huang Kai and Another
|
DCCC 968/2011 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CRIMINAL CASE NO.968 OF 2011 -------------------------- HKSAR against
--------------------------
Reasons for Sentence 1.The defendants pleaded guilty to one joint charge of conspiracy to deal with property known or reasonably believed to represent proceeds of an indictable offence, more commonly known as ‘money laundering’, contrary to s.25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap.455 (“OSCO”) and ss.159A and 159C of the Crimes Ordinance, Cap.200. The maximum sentence on conviction of this offence upon indictment is that of a fine of $5,000,000 and imprisonment for 14 years.
2.PW1 (56 years old male) received a phone call while he was at home from a person pretending to be his son telling PW1 that he needed help. Another person took over the phone and told PW1 that PW1’s son was a guarantor of someone who owed them HK$200,000 to HK$300,000 and told PW1 to settle the debt for his son. PW1 recognized that the voice did not belong to his son and saw through the scam. PW1 secretly reported the matter to the Police while promising the male that he will pay him HK$120,000. The Police was then involved and $50,000 was arranged to be dropped off at a telephone booth at the junction of Nathan and Austin Road in Tsim Sha Tsui. 3.D1 approached the telephone booth shortly after PW1 had dropped off the money in an envelope and took it. D1 then walked towards D2. Police intercepted just when D1 tried to hand over the envelope to D2. Both D1 and D2 were eventually arrested and cautioned. 4.Under caution, D1 said D2 instructed him to pick up the packet and that it had nothing to do with him. D2 said under caution that he did not know anything. 5.In a later video recorded interview, D1 said, among other things, that he met D2 in Zhuhai about 7-8 days ago and D2 offered to take him to Hong Kong for free but he had to pick up money in Hong Kong for D2 for a reward of $500 per day. D1 suspected what he was asked to do was illegal but he came to Hong Kong with D2 on 20th June 2011 anyway. It was D2 who told him to go to pick up a plastic bag from the telephone booth quickly after PW1 had made the drop off. D1 said he knew nothing of the deception. 6.In a later video recorded interview, D2 said, among other things, that he was a businessman trading in sausages and that D1 was his business friend. D2 said it was a person referred to as “Sam Til” who asked him to pick something up in Hong Kong. D2 felt suspicious and “Sam Til” suggested for D2 to ask D1 to do the pick up instead and so D2 asked D1 to do so as instructed by “Sam Til”.
7.D1 and D2 both have a clear record in Hong Kong.
8.The prosecution seek to enhance sentence under s.27 of OSCO on the basis of the prevalence of this specified offence. The facts relied on by the prosecution on their application are admitted into evidence under s.65B of the Criminal Procedure Ordinance, Cap.221 in the form of the statement of Detective Chief Inspector Mr. Chan Che Man (“DCIP Chan”), exhibit P-1. 9.DCIP Chan explained that under the Police Force’s policy, ‘telephone deception’ cases are basically classified as ‘Obtaining Property by Deception’ or an attempt to do so. A case is classified as a ‘Telephone Deception’ if it falls under the definition in s.17 of the Theft Ordinance, and it contains the following elements: (a) the suspect contacts the potential victim by telephone; and (b) the suspect uses some deception to persuade (or attempt persuade) the victim to transfer or deposit funds into a designated bank account that is under the control of the suspect, or to handover the funds in person. 10.Telephone deception cases usually takes one of 2 modes of operation. There is first the ‘bank deposit’ cases where the money would be requested to be deposit into bank accounts. The other mode is the one involved in our present case, the ‘drop off’ cases, where the money would be asked to be dropped off at a specific location and picked up by people who usually did not have anything to do with the actual deception. 11.It is also disclosed in the evidence of DCIP Chan that a high percentage of the victims in telephone deception cases are targeted at victims who are over 50 or 60 years old at their homes. Reports from previous investigations showed that many elderly victims had lost money from their life savings. DCIP Chan also pointed out that the nature of the offence itself also preys upon the close family ties that exist in the traditional Chinese family unit in a way that is difficult for the Police to quantify. 12.DCIP Chan then noted that the physical collection of cash in person was not common until October 2008. Of the 1,017 successful cases reported between 2009 and 2010, only 20.3% (206 cases) involved physical collection. In the first 10 months of 2011, among the 395 total number of successful telephone deception cases, there was 31.1% (123 cases) of drop off cases involving such a mode of operation. 13.In gist, it is the evidence of DCIP Chan that the ‘drop off’ mode of operation is becoming more and more common and the losses associated with it are substantial, as set out in the table in paragraph 28 of his statement. DCIP Chan concluded that telephone deception and the associated money laundering activity is a prevalent crime in Hong Kong and that this crime is an obvious concern to the society of Hong Kong.
14.D1 is 39, born in Zhuhai, China, holder of Chinese 2 way entry permit. D1 received education up to Form 1 in Zhuhai. He was taxi driving earning around RMB2,500 to 3,000, depending on his work load. He resided with wife and daughter. The defendant contributed $600 every month to his father who lives separately. 15.The defendant has a clear record in Zhuhai as well. The defendant pleaded guilty, was cooperative with the Police during investigation. D1 indicated his intention to plea guilty and that he was willing to be a prosecution witness. 16.D1 did not know a person called “Sam Til” that’s why he cannot assist Police in the investigation. D1 was not a mastermind in this case. he was induced by D2 coming into Hong Kong for free and for $500 per day agreed to pick up the money. 17.The defendant charged with a single offence. the offence did not take place over a period of time, just a one off incident. The sum involved was just $50,000. There was in fact no loss at all since no real money was used. 18.Mitigation letter from the defendant’s wife handed up. 19.Mr. Bok relies on the case of HKSAR v Wu Jianbing, CACC 32/2011, which facts are very similar to our present case. In that case, the total amount of money involved was $310,000 involving 4 charges which took place within a very short period of time. 20.The Court of Appeal in Wu Jianbing referred to their earlier case of Secretary for Justice v Wan Kwok Keung, CAAR 13/2010 where it was pointed out that money laundering was a serious offence and that generally the sentence should mainly reflect the amount of ‘black money (黑錢)’ being laundered and not the benefit obtained by the defendant or others. In Wan Kwok Keung, the Court of Appeal explained that if the defendant had obtained huge benefit from the money laundering, then the sentence should be adjusted upward.
21.The Court of Appeal in Wu Jianbing also referred to earlier cases indicating that other factors relevant to sentencing included the number of offences and their duration, the degree to which the defendant participated in the offence involving the proceeds and whether or not it was an organized and sophisticated crime. 22.Having stated their views, the Court of Appeal then took into consideration that there was no evidence to show that the applicant participated directly in the offences in connection with the ‘black money’, nor was there evidence to prove the benefit he obtained. The Court took the view that judging from the amount of ‘black money’ and the other circumstances, the appropriate starting point for each charge should be 3 years’ imprisonment. The applicant was given a one third discount for his plea of guilty, reducing the sentence to 24 months’ imprisonment. The Court of Appeal agreed that the sentence should be enhanced by one-third, that is to say 8 months, pursuant to OSCO, resulting in a sentence of 32 months’ imprisonment on each charge. Mr. Bok submitted that a similar sentence should be adopted. 23.Mr. Bok confirmed that he does not oppose the application to enhance the sentence based on the evidence adduced by the prosecution in the statement of DCIP Chan and pursuant to s.27 of OSCO.
24.D2 is 43, born in Taiwan, holder of a Taiwanese passport. Education up to Form 4. He worked as a sausage wholesaler and retailer in China, earning around RMB$3,000 per month when he was arrested. D2 suffers from gout. D2 has clear record in China and Taiwan. His wife is 28 and son both dependent on him with him as the sole bread winner. 25.How D2 came to be involved. He had a proper job as a sausage wholesaler. He was not doing very well, just making ends meet. He came to know this ‘Sam Til’ who was the mastermind in the case and got D2 involved. 26.D2 was not promised any money. In fact he at first shied away, until told by Sam Til that he did not had to be involved and told him to get D1 to do it instead. He realized it was wrong. 27.There was an implied threat from Sam Til that his business would be affected and his family may be affected. That was part of the persuasion that led him to commit the offence. His will was not overborne. Matter would not be good for him if he did not comply. 28.He believes that Sam Til was involved with triads, and that Sam Til was the one who directed things. 29.D2 is remorseful and shown in his plea today and his indication as long as one month ago. 30.D2’s wife has written a letter. 31.In terms of enhancement, Mr. Pang’s position is that he does not dispute that based on the figures in DCIP Chan’s statement the present offence is prevalent. Mr. Pang would however like to point out to the court that there seems to be an overall downward trend in 2011 in the number of telephone deception cases and that the court should enhance the sentence by no more than one-third. 32.Mr. Pang also pointed out that in the case of Wu Jianbing, the applicant was facing 4 charges and the money involved was $310,000 which is more than the sum of $120,000 that PW1 had agreed to pay, or the $50,000 that was supposedly to have been paid.
33.I do not find any of the personal circumstances put forward on behalf of the defendants as mitigating factors and I did not take them into consideration when deciding on my sentence. They should have no more than the usual one third discount upon their plea of guilty. 34.I do not find any difference in the culpability of D1 and D2. They both knew clearly what they were getting themselves into and played an equally important role. They should face the same sentence.
35.Although this is a charge of conspiracy, I find that the sentencing cases in relation to money laundering are helpful in coming to an appropriate starting point. In previous cases like HKSAR v Hsu Yu Yi [2010] 5 HKLRD 536, the Court of Appeal said that the factors to consider in sentencing in a money laundering case included the amount of the money being laundered, the sophistication of the laundering, the scale of the laundering, the gravity of the underlying offence, the knowledge of the launderer of the underlying offence and whether there is an international element involved. 36.In our present case, the underlying offence plays on the vulnerability of the victim’s concern for his or her friends or family members. It is a crime that is easy to commit, all that the criminal needs is a phone with an untraceable SIM card. As pointed out at paragraph 14 of DCIP Chan’s statement, technological advance now would even allow calls to be made over the internet, meaning that the call can be made virtually for free from any place in the world. 37.In the present mode of operation of ‘drop off’, the only risky part of the crime is the picking up of the money. This is where the defendants come in. Although they may not have been the mastermind of the scam, they are arguably the most important cog in the whole mechanism, just like a defendant who allows his or her bank account to be used to deposit and withdraw money by the culprits. Without their willingness to help out with something they believed was illegal, all that went before the picking up of the money would have been for naught. 38.I find that, given the clear record of the defendants, the amount of money involved, the relative lack of sophistication in the laundering itself and the lack of an international element, an appropriate starting point is that of 3 years’ imprisonment for each of the defendants.
39.I find that the prosecution has proved beyond reasonable doubt based on the evidence of DCIP Chan that telephone deception and in particular by way of the ‘drop off’ method is a prevalent crime as at the time of sentencing. I find that based on all the circumstances and taking into consideration the case of Wu Jianbing, an appropriate enhancement would be that of one-third.
40.I will grant the defendants the full one-third discount for their guilty plea and reduce the sentence from the initial starting point of 36 months to that of 24 months’ imprisonment. 41.This sentence is then enhanced by one-third, that is to say by 8 months, meaning that the total sentence is that of 24+8=32 months’ imprisonment. 42.D1 and D2 is therefore each sentenced to 32 months’ imprisonment for the charge.
43.Lastly, I would like to commend PW1 Mr. Wong for being so alert and brave in coming forward to expose the scam. Most people would have just hung up once they realized the scam. Mr. Wong might well have spared quite a number of future victims suffering his ordeal.
|
Cases cited in this judgment