HKSAR v. Cheung Ying Tat

DCCC 1131/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 1131 OF 2011

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Reasons for Sentence

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1.Defendant, you have pleaded guilty to a charge of fraud, contrary to section 16A of the Theft Ordinance, Cap. 210.

2.You admitted that between 7 August 2007 and 14 December 2010, you by deceit falsely represented to Parknshop that there was a need for Parknshop to purchase from Hang Tat International Trading Company (“Hang Tat”) use-by labels which were in fact of no use to Parknshop by doing so you defrauded Parknshop to pay a total of $9,108,900 to Hang Tat as payment for these use by labels.  This resulted in prejudice of substantial risk to Parknshop. 

3.In a nutshell, that charge states that, you as an employee of Parknshop falsely represented to Parknshop that there was a need for Parknshop to purchase these use by labels from Hang Tat which were useless.  Parknshop therefore paid over $9 million over a period of about 3 years for these useless labels.

4.At that time you were a Senior Production Coordinator.  You had committed an elaborate fraud on Parknshop by firstly telling your superior that Parknshop needed these labels when you knew that it did not.  You then used further elaborate means in the computer system to disguise the purchase of the labels by using the $1 code which could not identify labels.  You had enlisted the 2nd defendant to deliver these labels to you personally and not to the receiving department which they should have been delivered to.  After they were delivered to you, you then surreptitiously disposed them into the rubbish.  Daringly though, you left the labels outside your office in full view until disposal. 

5.You had enlisted your friend, D2, whom I acquitted after trial into your elaborate fraud.  D2 was not in the business of printing labels but operated a bar.  Nevertheless, you sought for him to assist you to defraud your employer Parknshop.

6.The profit margin that you assisted D2 to make was mammoth.  The sales by D2 to Parknshop grossed a profit of some 750 per cent.  I was satisfied that in view of that large profit that you would have benefited in some way.  I was not, however, able to identify how it was you benefited or the amount that you benefited.  I was satisfied in this case, however, that you must have at least benefited from your frequent travels with D2 over the charge period of some 25 times out of Hong Kong to China and Japan.  I found that it was very likely that D2 would have treated you handsomely on these travels.  I therefore sentence you on the basis not of the amount that you have gained but on the loss of this elaborate fraud that you caused to your employer Parknshop. 

7.Your counsel, Ms Liza Yip, has mitigated fully and thoroughly on your behalf.  I have taken into account all that she has had to say.  You are 35 years of age and are of clear record.  You are married with a daughter aged 3 and a stepdaughter aged 12.  I have borne in mind the good character reference from your previous supervisor at Parknshop.  I have taken into account the letters written by your wife and your parents in saying that you are a filial son and good husband.  You are a responsible father providing for your family.  As they say and as Ms Yip rightly points out, your strongest and greatest mitigating factor is your plea of guilty.  Your wife has mentioned that you are remorseful and your repentance is genuine and sincere.  I accept that to be the case as you have pleaded guilty.

8.This type of fraud is of course a clear breach of trust.  You were at that time an employee of Parknshop.  You were given duties and responsibilities in respect of ordering of labels.  You had breached your employer’s trust by defrauding them and ordering these useless labels in the huge sum of $9 million.  This is every reason to say that Parknshop trusted you enormously. Ms Yip has told me that your family has a long history with Parknshop.  Your father worked there for many years, your mother still works there now and has been doing so for the past 20 years, your wife had worked there for seven years, your brother had worked there for many years.  Your father had in fact introduced you to work at Parknshop right after you left school.  You had in fact worked there since 1996.  Prior to you committing the fraud on Parknshop, you had worked there for some 11 years.  You have brought disgrace to yourself and no doubt to the reputation of your family and your family amongst Parknshop as well.  I have no doubt that your father and family are gravely disappointed with your criminal acts.  Nevertheless, they, reflected in their letters and know that this is a serious crime and you will be punished accordingly. 

9.Ms Yip has informed me that she has advised you about the sentence and the likelihood that the court will sentence you on the loss to Parknshop and base this on a breach of trust sentence.  The Court of Appeal have laid down tariffs for breach of trusts when considering the amount of money which was either stolen or defrauded.  These guidelines or tariffs were set down in the case of Cheung Mee Kiu and later corrected slightly in the amounts in Ng Kwok Wing.  The amount to which Parknshop was defrauded is $9 million and the bracket therefore to which you fall in is the amount of between $3 million to $15 million where the starting point to be adopted is one of between 5 and 9 years’ imprisonment after trial.

10.Defendant, in view of the amount of $9 million, had I convicted you after trial the appropriate starting point in would be one of 7½ years’ imprisonment.  However, you have pleaded guilty and I must of course reflect your plea of guilty and give you the one-third discount.  In those circumstances, defendant, you shall be sentenced to 5 years’ imprisonment.