HKSAR v. Zeng Wei

DCCC 1368/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 1368 OF 2010

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Reasons for Sentence

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1.This is a case of corruption between a banker, Derick Chan, and a mainland businessman, Zeng Wei, that is the defendant in the present hearing, who did not show up at his joint trial with the banker 3 years ago, and is now brought back from America to be dealt with before me.

2.The defendant pleaded guilty to one count of section 9 corruption offence, Charge 16, and his other offences: One, Charge 11, the prosecution withdrew, and thus it was discharged; and two others, Charge 3 and 15, are left on court’s file.

3.At the material times, the defendant and his company engaged basically in the mainland in various kinds of business, including property development, hotel, golf course, etc.  Mr Chan was the head of Corporate Banking Department of ICBC, which handled corporate clients, and one of the duties of Mr Chan was to process their loan applications, renewals and applications for deferring repayment.

4.Between 2006 and 2008, the defendant was able to take out a few sizeable loans from Mr Chan’s bank.  Here we are talking about billions of dollars of loans.  At least in one of the loan agreements Mr Chan signed on behalf of the bank.  After the loans were granted, there were occasions when the defendant had to ask the bank for an extension of time for repayment, and Mr Chan had endorsed on those applications no fewer than four times, and all these applications were eventually approved by the credit committee of the bank.

5.After all this, there came a time on 5 October 2010 when the two met in a hotel, where the defendant handed over a bag containing 2.3 million cash to the banker, and on this occasion the ICAC officer took action and arrested the two men and seized the cash as exhibit.

6.The defendant, aged 52, has no previous convictions.  Defence counsel takes me through his background, his career and business, and how he ended up being a successful businessman and the reasons for his absconding, etc.

7.Defence counsel rightly pointed out that corruption is a serious offence, and the courts have always taken a tough line with offenders.  As far as the starting point is concerned, defence counsel urges this court to adopt the same starting point as in the case of Mr Chan, ie 3 years, and I have no problem with that.

8.Defence counsel continued to submit that the court should give the defendant the same usual one-third discount for a guilty plea, which I do not agree.  His reasons are that:

(1) The defendant fully co-operated with the authorities and was prepared to plead guilty to Charge 16. He was also prepared to testify for the prosecution.

(2) The reason for the defendant leaving Hong Kong was that he wanted so desperately to be by the side of his ailing mother.

(3) After his arrest in Saipan he immediately indicated that he would not contest extradition and that he would plead guilty to Charge 16.

9.Counsel has taken me through a number of authorities such as Ko Chun Hong CACC 71/2007, Lo Shu Wa CACC 399/99, Tsang Tsui Yen CACC 188/99, and Chan Tat Lam CACC 118/2006.  It seems from these authorities the discount varies from 16.6 per cent to 27.7 per cent, and in one case, Chan Tat Lam, the appellant had absconded for 12 years, but was still given the usual one‑third for his plea.  I would think this case is an exceptional one.

10.I think only reasons (1) and (3) worth discussion.  Let us look at the matter in this way.  If the court gave the usual one‑third discount indiscriminately to the absconding offender, it would only encourage more to take the risk to abscond, for they would know they would end up no worse off in the event of being caught, and it would not be fair to those who choose to stay and to face the music like Mr Chan, the banker, in this case.

11.Counsel also said that the defendant was prepared to testify for the prosecution.  He had given two statements to the ICAC in which he said he was coerced by the bankers to bribe them.  Counsel said he did not know if this had any bearing on the fact that Mr Chan pleaded guilty on his first day of trial.

12.In fact, the evidence against Mr Chan in the case was overwhelming.  He was caught red-handed with 2.3 million cash in a bag given to him by the defendant.  Faced with this evidence, I would say his options were very limited.

13.Counsel submitted the defendant was prepared to give evidence for the prosecution, but I wonder how he could do that by absconding.  His behaviour tells the court one thing only:  he had no intention to assist the prosecution in any way.

14.Now I come to consider the time the defendant spent in custody in America awaiting extradition.  Again, the authorities I have been referred to by counsel show that this is a judicial discretion. Undisputed is that the defendant was arrested in Saipan, a place within US jurisdiction, when he tried to enter America.  He spent 5 months in custody before he was finally brought back to Hong Kong.  Defence counsel stressed that the defendant did not seek to fight against extradition, and indicated that he would plead guilty to the charge from the very beginning. Counsel urges this court to grant the defendant the full credit of 5 months.

15.A slightly different picture emerged when the prosecutor informed the court that in fact the defendant was initially arrested by the US authorities at the port of entry for some immigration offences, and that had to do with his travel document he was using at the time.  The defendant was using a travel document apparently under an assumed name, and more importantly, the document showed a different date of birth.  He was actually charged with two offences:  one of making a false statement and the other of misuse of passport.

16.On 22 January 2014, a day after the Hong Kong authority issued a provisional warrant to the US authorities to initiate the extradition proceedings, the defendant indicated that he would waive extradition and was willing to come to Hong Kong to plead guilty to the charge.  In March 2014 the American Authorities dropped the charge, so at the time when the defendant decided to waive extradition in January, he was in fact wanted by two governments.  There he was facing only two options:  either come to Hong Kong to answer the charges against him or stay in the US to fight his case concerning his use of the passport.

17.He may be acquitted, he may be convicted; but either way, he would likely, at the end of the day, be extradited back to Hong Kong to face his charges here.  It does not take a rocket scientist to work out the best option available to him in these circumstances.  But anyway, I would think that time has been used by the US authority to look into the matter to ascertain the defendant’s real identity, and I believe that would have delayed an extradition somehow and is something the defendant brought upon himself.

18.For this reason, I would only deduct 3 months instead of 5 months from his final sentence.

19.Counsel also relied on the defendant’s positive character as a factor for a further reduction of sentence.  It is submitted that he had donated a total sum of about 31 million to various charities. When asked by the court if any of these donations benefited Hong Kong, counsel said there was no conclusive evidence.

20.The idea of positive good character is to award in recognition of one’s services, contributions, etc, to the local community, and there is no evidence to suggest that the defendant had contributed anything to the local community here, and I decline to give further reduction for this matter.

21.Given all that I have said, I will take 3 years as a starting point, reduce it to 30 months to reflect his plea, and further reduce it to 27 months to take into account his period of detention overseas.

22.There being no reason for further reduction, the defendant is therefore sentenced to a term of 27 months’ imprisonment.