HKSAR v. Ng Ka-ki, Robert Alias Robert Woo and Others

DCCC 810, 813 & 934/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 810, 813 & 934 OF 2011 (Consolidated) (Part A)

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Reasons for Sentence

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There were originally 10 defendants in this case. For the present sentencing exercise only D1, D6 and D8 are involved.

2.D1 faces the following charges:

(a) Charges 1 and 4 – agent accepting an advantage;

(b) Charge 2 – conspiracy to defraud, jointly with D3 to D5;

(c) Charge 5 – conspiracy to defraud.

He pleads guilty to Charges 1 and 4. The other 2 charges against him are left on court file and not to be activated without the leave of the court.

3.D6 faces one count of aiding and abetting agent accepting an advantage which is Charge 3 while D8 faces 3 counts of dealing with property known or believed to represent the proceeds of an indictable offence which are Charges 6,7 and 8.  They plead not guilty to the charges but are convicted after trial of all of the charges they are facing.

4.The particulars of all the charges involved in the present sentencing exercise are set out in the charge sheet and the court is not going to repeat them here.

Facts Admitted and Found During Trial

5.The Hong Kong Jockey Club (“HKJC”) was incorporated in Hong Kong on 14 July 1903 as a company limited by guarantee.  The main categories of individual members of HKJC are voting members, full members and racing members

6.Candidates for racing membership have to be proposed by a resident honorary steward or voting member or honorary voting member, and seconded by any other member of the same categories, as well as supported by 3 other individual members.

7.A racing member is eligible to apply to become a full member at any time.  Candidates for full membership have to be proposed in the like manner. No seconder or supporters are required.  The application forms for racing and full membership are serially numbered and are issued to and for use of the voting member named on the form only and is not transferrable to another voting member.

8.In proposing or seconding an applicant for racing membership the voting member should be well-acquainted with the applicant and able to provide reference of the applicant’s character.  He has to state on the membership application, inter alia, that he has personally known the applicant, the duration and nature thereof and why he considers the applicant suitable to be a racing member or a full member, as the case may be.          

9.HKJC relies on the integrity of the voting members to propose and second and other members to 0support candidates to become members.  All members are not allowed to solicit or accept, and all prospective members not allowed to offer or pay, any advantage for the sponsorship or support of any membership application.  All members and prospective members must make a declaration in the membership application form to the effect that no advantage has been accepted or offered.

10.HKJC considers itself to have been misled and deceived if its members wilfully provide false statements in membership application forms.           

11.Mr John Douglas Mackie (“D2”) and Mr Stanley Lawrence Freedman (“D7”) are honorary voting members of HKJC.  Dipo Chandiram Sani (“D5”) and HO Wai-tak David (“D9”) are voting members.  For each racing seasons they are eligible to propose 2 candidates for full membership and 5, or on request basis, 10 for racing membership.

12.Mr Tong Kam-pui (“D3”), Mr HO Wai-shek (“D4”), Mr TO Wing (“D10”) and D1 are either racing or full members and can therefore be supporters of racing membership applications.     

Charges 1 and 3

13.Through Mr TANG Kang-chung Billy (“D8”) D1 came to know FUNG Yiu-man Daniel, the 5^th prosecution witness in the trial (“PW5”) and Michael FONG, the 6^th prosecution witness in the trial (“PW6”), both ICAC undercover agents.  PW5 posed as a wine merchant and PW6 as his employee.  On a number of occasions D1 and PW6 discussed about the subject of D1 assisting PW5 to become a racing member of HKJC.  On 14 June 2010, during a meeting, D1 told PW6 that he could arrange D2 and other HKJC members to sponsor PW5’s racing membership application and solicited $250,000 cash from PW6.

14.On 26 July 2010, during a meeting with PW5, D1 arranged for Mr LAM Wai-chee (“D6”) to receive $250,000 cash from PW5 on his behalf for providing assistance in PW5’s membership application.  After D6 had received the cash and placed it on the desk of D1, D1 accepted the money and asked D6 to provide PW5 with a racing membership application form of serial number R001141.  D1 asked PW5 to contact D6 after filling in the form.

15.It is the finding of the court during the trial that D6 knew full well that he was receiving $250,000 cash from PW5 and was handing over the HKJC racing membership form to PW5, although the money and the application form were put inside separate envelopes.  D1 said that D6 would bring PW5 to see 2 westerners.  D6 made the arrangements and took PW5 and PW6 to meet D2, the proposer of PW5’s application, on 3 August 2010. 

16.On 19 October 2010 PW5 met D1 and D5 in a restaurant and D5 seconded, while D1 supported, the application of PW5 by filling in the application form.  D1 falsely stated in the form that he had known PW5 for 17 years, that no advantage had been received in sponsoring the application and that he had signed the form on the date written thereon.

17.It is the finding of the court during the trial that D6 took apart in taking PW5 to the venue of this meeting although he did not take part in the meeting himself.  The court also finds as fact that D6 was fully aware of the corrupt deal between and D1 and PW5 and he took part in it.

18.On 26 October 2010 PW5 met D1, D3 and D4 at D1’s office and upon the request of D1, D3 and D4 filled in and signed the application form of PW5 as supporters.  The form was submitted to HKJC on 4 November 2010.

Charge 4

19.In September 2009 D1 accepted $300,000 from Mr LAM Wai-ming (“LAM”) for assisting him to become a racing member of HKJC.  D1 provided the application form number 09R1290 to LAM and caused D2 to act as proposing member and D7 as seconding member and 3 other members as supporting members of LAM’s application.  All of them falsely stated in the application form that they had personally known LAM and the respective length of their acquaintance with Lam.  D2 and D7 also gave false information in the form about their relationship with LAM.

20.On 26 January 2010, before LAM attending the membership application interview D1 reminded him of the personal particulars of the proposing, seconding and supporting members and coached LAM how to answer the questions in the interview.

Charges 6, 7 and 8

21.In 2009 CHAN Yuet-ming, the 3^rd prosecution witness in the trial (“PW3”) came to know D8 at the Shatin racecourse.  D8 asked if PW3 wanted to be an HKJC member and when PW3 said no, he asked if PW3’s son would be interested.  D8 said that to become a member PW3’s son had to be of good character and personnel of HKJC had to be approached for signatures and the amount of $350,000 was to be paid.

22.After consulting his son and some friends, PW3 told D8 that he wanted to help his son to become a member of HKJC.  D8 told him to prepare cash of $350,000.  D8 collected the money from PW3 and 2 to 3 days later provided the HKJC membership application form to him.

23.PW3’s son, CHAN Chi-chung, who is the second prosecution witness in the trial (“PW2”) filled in the form with the assistance of D8.  Through the arrangement of D8 he met D7 and D10 who signed his application form as proposer and seconder respectively. Acting on the instruction of D10 he went to see Dr HO Wai-tak (“D9”) who signed the application form as a supporting member.  All of them falsely stated in the application form that they had personally known PW2 and about the length of their acquaintance with PW2.

24.The other 2 supporting members who signed the form were known to PW2.  He submitted the application to HKJC in March 2009 and was duly elected a racing member after about 1½ years.

25.In the beginning of 2010, D8 asked PW3 if he wanted to help PW2 to become a full member of HKJC for $1 million cash.  After some negotiation the amount was reduced to $900,000 cash payable by 2 instalments.  It is the finding of the court during the trial that the money was illegal advantage to members of HKJC for sponsoring the application for full membership of PW2.

26.D8 collected $450,000 cash from PW3 and a few days later through his arrangement PW2 and PW3 met D1 and D2.  D1 told PW2 that D2 would sponsor PW2’s application.  He told PW2 the background of D2 and D2 also asked PW2 about his background.

27.In July 2010 D8 collected the remaining $450,000 cash from PW3 and provided him with the HKJC full membership application form.  Through the arrangement PW2 had another meeting with D2 who signed the application form as proposing member.  D2 falsely stated in the form that he had known PW2 personally for 2 years and that PW2 went to horse racing at least once or twice a month.

28.PW2 submitted the application form to HKJC on 23 August 2010.

Criminal Record

29.D1 and D6 have a clear record.  D8 has a previous conviction of 5 counts of theft on 3.4.1985 for which he was placed on probation for 12 months.

Background Reports

30.The court has obtained background reports of the 3 defendants before sentencing.  According to the report D1 is aged 56 and was brought up in a middle-class businessman family with adequate care and attention.  He received senior secondary and tertiary education in USA.  He came back to Hong Kong to help in the family business at the age of 25.  His relationship with his father turned sour when he insisted to get married despite his father’s objection.  He left the family business and after his wife gave birth to a son in 1979 he worked as a probationary inspector of Customs and Excise for a year.  Due to financial stringency and pressure the relationship of the couple was tense and conflicting.

31.D1 rejoined the family business which was collapsing and he and his elder brother managed to rebuild the business.  After a few years D1 started his own business which was mainly in logistics, transport, supply of fruits, vegetables and fresh meat to supermarkets, fashion bags, hardware, supply of various products to duty free shops and wholesale of agricultural products.  Although there were ups and downs in his business the profits generated reached as much as $20 million per year during the prosperous years of 2008 to 2010.

32.He separated from his wife in 1986 and they were divorced in 1990.  D1 paid regular visit to his 2 children under the custody of the wife.  He got remarried in 2006 with a mainlander with whom he had cohabited for a few years.  His present wife suffers from anxiety and is receiving psychiatric treatment in Hong Kong and is making good progress.

33.According to the probation officer who compiles this report D1 admits his greediness and expresses regret for his fault in the present offences which had a great impact on his business and his family. He is willing to bear the legal consequences and asks for leniency from the court so that he can have an early release to look after his present wife.

34.According to the report D6 is aged 60.  He was brought up in working class family.  He dropped out from school after completing Form 2 and stated open employment at the age of 16.  He had worked as a technician and call operator of a telegraph company, an alarm system salesman and a carpet salesman.  He started his own business in partnership with a friend in China in water cooler and then health food business.  He returned to Hong Kong in 2009 when the business failed.  He worked as a clerk for D1 in a trading company when he was arrested.  He has resigned from the job and is now a casual courier delivering goods to China earning around $10,000 a month.

35.He married twice but both marriages ended up in divorce, bringing him a son from each one of them.  He has lost contact with first wife and son and the son of the second marriage is now aged 18 who is a student.  He moved back to live with his ex-wife of the second marriage in 2011, but in 2012 he married for a third time in China, keeping the ex-wife and present wife in dark about his marital status and condition.  The 2 families have brought about a tight budget upon him.

36.D6 claims that he acted under the instruction of D1, but he admits his wrongdoings of engaging himself in the unlawful acts of D1.  He pleads for a lenient sentence so that can be discharged earlier to take care of his ex-wife and son.

37.According to the report, D8 is aged 49 and is married with a son and 2 daughters aged 15, 17 and 20 respectively.  The son and the younger daughter are students.  He was born in China where he received education up to Secondary 3.  After coming to Hong Kong in  1980 he took short courses in the field of construction and masonry for a total of 2 years.  He had worked as a factory worker, a curtain installation apprentice and a restaurant worker.  He was a mason for most of the time and in recent years he is doing the job on a casual basis earning about $12,000 a month.

38.He encountered a traffic accident in China more than 10 years ago and the family had to rely on Comprehensive Social Security from 1998 to 1999 and from 2000 to 2006. Although D8 is not in debts the financial condition of his family is tight.  He is considered by his wife to be a responsible husband and a loving father.

39.D8 got acquainted with D1 while playing football, but D8 ceased playing football when he broke his leg in 2008.  D1 often gave him free admission tickets to the racecourse.  He maintains his innocence in the present offences.

Mitigation

40.Counsel for D1 tells the court that D1 understands the background report and accepts its contents. He point out that the present case may be an exceptional one which does not warrant an immediate custodial sentence.  He emphasises that D1 pleads guilty at the earliest opportunity and has been in custody for about 84 days.

41.D1 has been subject to ICAC investigation since May 2011 and had been stopped from travelling outside Hong Kong, resulting in a massive impact on his life because his wife is a mainlander. His business had equally been affected.  Up to 2010 D1 was a shareholder and director of 21 companies which has now been reduced to 18 or less companies. The business turnover of these companies at the time of D1’s arrest was about $450 million a year which has now been reduced by as much as 50%, while the number of employees on payroll has also reduced from 500 to 600 to about 300.  The income of D1 before arrest was about $0.5 million to $750,000 a month which has now become about $150,000.  The counsel tenders to court the business contracts entered into by some of the companies of D1 and the turnover of these companies before and after the arrest of D1 to support his contention.

42.D1 has done a lot of charitable work for over 20 years.  In one Christmas he donated 17 containers of toys which were worth millions of dollars to children in Hong Kong.  D1 did not only give donations but also spent much time in giving inspirational talks to young people and the unemployed.  He also makes regular donations to charitable causes.  In this connection counsel tenders to court letters written by a social worker of Caritas Youth and Community Services and 2 Catholic nuns which giving information about donations given by D1 and his good character.  Counsel also submits letters from people doing business with D1 to illustrate the impact on the business after D1 was stopped from travelling out of Hong Kong.  

43.Counsels also submits to court mitigation letters written by those people having business with D1, his friends and his children.  They all have a good opinion of D1 and urges the court to be lenient to him.

44.China has a high regard of D1, appointing him to the National Committee of the Chinese Political consultative Conference.  He resigned from the post in January 2012 because of the present case.

45.D1 is not in good health, requiring constant medical attention.  During the time he was in custody he was placed in the hospital ward of Lai Chi Kok Reception Centre.  Counsel produces to court a letter from Dr KONG Siu Ming who pointed out that D1 suffered from hypertension, diabetes, dyslipidema and myocardial ischaemia at septum of the left ventricle.  Examination of D1 also showed that there were signs of prostate cancer.

46.Counsel draws a distinction of the present case from the case of HKSAR v Hung John Terrence [2009] HKDC 1472 in that D1 was only a full member while John Hung was a voting member on whom a great degree of trust was placed by HKJC.

47.Counsel emphasises that in Charge 4 the person who paid the money to D1, i.e. LAM, is a very rich person and is a suitable person to be member of HKJC and the information D1 put down in the application form was given to him by LAM himself.  As for Charge 1 D1 was initially not interested in helping PW5 to become an HKJC member and only committed the offence after quite a number of meetings.  Counsel points out that D1 was as such not so proactive in this offence and urges the court to take this into account.

48.Counsel submits a number of cases to court for reference and asks the court to impose a CSO or suspended sentence on D1 and if immediate custodial sentences are to be imposed for the 2 charges to make them to run concurrently.

49.Counsel for D6 points out that D6 understands and agrees to the contents of the background report. D6 is aged 60.  He was an ordinary worker employed by D1 and he also had business in China.  He entered into the picture at the late stage of the offence and his degree of culpability is on the low side.  He has been in custody for 2 weeks.  Counsel asks the court to impose a community service order on D6.

50.Counsel for D8 tells the court that D8 understand and agrees to the contents of the background report except that D8 is aged 50 not 49 and the traffic accident he encountered took place in Hong Kong instead of China as stated in the report. 

51.D8 is a good husband and father.  He suffers from hepatitis and there are signs of prostate cancer. Although he is convicted after trial the offence are not sophisticated, involving no international dimension or organised crime syndicate.  The criminal record of D8 is long time ago.  D8 was not the main culprit and the 3 offences were of the same background.  Counsel asks for concurrent sentences and leniency.

Sentence

52.Hong Kong has spent a lot of money and efforts to fight against corruption over the last 40 years and has successfully turned Hong Kong from a corruption-infested city into one of the cleanest cities in the world in terms of corruption.  We are proud of our achievement and of course cannot allow a small bunch of unscrupulous individuals to destroy our fruits of success and hard-earned reputation.  

53.There are ample authorities saying that for corruption offences a deterrent sentence is called for.  Even in the cases submitted by the defence to the court which are SJ v KWAN Chi Cheong [2009] 4 HKLRD 273, HKSAR v LAI Chin Pang [2002] HKCFI 471, HKSAR v WEI Show Ying [2004] HKCA 64, HKSAR v CHAN Kun Hoi [2008] HKCFI 829, HKSAR v TO Yiu Cho [2009] 5 HKLRD 309 and HKSAR v Hung John Terrence [2009] HKDC 1472 the sentences imposed were all immediate custodial.

54.D1 was a full member of HKJC and he committed a serious breach of trust in accepting illegal advantage in sponsoring candidates to become members of HKJC.  In this connection the court must point out that the trust placed on a member by HKJC makes very little difference between a full member and a voting member because by their misdeeds candidates are able to bribe their way to become members of HKJC.

55.The court has some sympathy about the business losses which D1 suffers as a result of the present offences, but this goes to the personal circumstances of D1 himself and is also something D1 should be able to foresee before he embarked on the illegal enterprise.  Although he has done a lot of charitable work and is an upright and honest person in the eyes of those who have written mitigation letters on his behalf all these again go the personal circumstances of D1.  They do not change the serious nature of the offences and there are no exceptional circumstances going to the nature of the offences D1 had committed which justify a non-custodial sentence or community service order to be imposed.  The mental problem of D1’s girlfriend and the medical conditions of D1 as they are now also do not constitute valid mitigation.  The court will of course still take all the charitable work and the business losses of D1 into account in deciding the sentence to be imposed.

56.The offences were well planned and various members of HKJC were engaged to sponsor the membership applications and D6 also assisted in the illegal deal.  Having considered the whole circumstances of the case, including the charitable work done by D1 and the substantial losses in his business as well as the relevant cases cited, the court adopts a starting point of 2½ years imprisonment for each of Charges 1 and 4.  In an offence of this nature the clear record of D1 does not constitute a valid mitigation factor.  The only other mitigation D1 has is his plea of guilty.  After giving credit to him in this connection the court sentences D1 to 1 year 8 months imprisonment for each of Charges 1 and 4.  These 2 charges are separate and distinct offences and their sentences should in theory run consecutively.  Having considered, however, the nature of the case and, more importantly, the totality principle the court orders 10 months of the sentence of Charge 4 to run consecutively to that in Charge 1.  D1 is to go to prison for a total of 2 years 4 months.

57.The court accepts that D6 was only a secondary party and being the employee of D1 he played a lesser role in this criminal enterprise.  But it must be pointed out that he was still an important cog in the commission of the offence.  Having considered the whole circumstances of the case and the relevant authorities the court adopts a starting point of 2 years imprisonment.  The court is the view there are no mitigating factors which justify a reduction in the sentence.  D6 is therefore sentenced to 2 years imprisonment in respect of Charge 3.

58.D8 dealt with the monies in the Charges 6, 7 and 8 knowing that they were proceeds of corruption.  He was even the one who instigated the corruption.  There are no sentencing tariffs in such an offence.  The reason is simple.  The circumstances in which such an offence is committed can vary substantially and it is impossible and also impracticable for the Court of Appeal to lay down any sentencing guidelines.

59.In HKSAR v HSU Yu Yi CACC 159/2009 and HKSAR v A male known as Boma Amaso CACC 335/2010, the Court of Appeal set out factors to be considered in sentencing and they include the amount of money laundered, the nature of the indictable offence involved and whether the defendant is aware of it, role of the defendant, whether international dimension and organised crime syndicate are involved, duration of the laundering and the degree of planning and sophistication.  The court accepts that the present case did not involve international dimension.  Although there is no clear evidence to show that the offences involved organised crime syndicate it is of no doubt that some planning and the concerted efforts of a number of people were required before the offences could be committed.

60.As the money involved was proceeds of corruption offences the laundering of the money would no doubt serve as an instigation for the commission of these corruption offences.

61.In the case of HSU Yu Yi the Court of Appeal reviewed a number of money laundering cases and set out the amounts of money involved, the durations of laundering and the ultimate sentences.

62.Charges 7 and 8 were of the same illegal transaction and were in the total sum of $0.9 million.  After considering all the factors set out in the authorities and the sentences imposed in similar cases the court adopts a starting point 1½ years imprisonment for Charge 6 and 2 years 9 months imprisonment for each of Charges 7 and 8.  Up to the present moment D8 has not shown any remorse for his wrong doings.  The court is of the view that there are no valid mitigation factors. The court therefore sentences D8 to the terms of imprisonment so adopted.  Taking into account the nature of the case and the totality principle the court orders the sentences of Charge 7 and 8 to run concurrently and 9 months of the sentence of Charge 6 to run consecutively to the sentences of Charges 7 and 8. D8 is to serve a total term of 3½ years imprisonment