HKSAR v. CHOW LAI YING, CANDY

DCCC 656/2019

[2021] HKDC 391

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 656 OF 2019

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REASONS FOR SENTENCE

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1.  Ms Chow pleaded guilty before me to Charges 1, 4, 6 & 7, all of money laundering contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap 455, on a Charge Sheet containing 8 charges. Particulars of Charges 1, 4, 6 & 7 are as follows.

2.  Charge 1 alleges Ms Chow, between 9 May 2008 and 13 January 2011, both dates inclusive, in Hong Kong, knowing or having reasonable grounds to believe that property, namely a sum of around $36,942,620.28 Hong Kong currency in the account numbered 438-820664-888 held under the name of Ms Chow with The Hongkong and Shanghai Banking Corporation Limited, in whole or in part directly or indirectly represented any person’s proceeds of indictable offence, dealt with the said property.

3.  Charge 4 alleges Ms Chow, between 6 May 2006 and 16 December 2010, both dates inclusive, in Hong Kong, knowing or having reasonable grounds to believe that property, namely a sum of around $47,761,009.43 Hong Kong currency in the account numbered 012-816-1-007294-8 held under the name of Ms Chow with Bank of China (Hong Kong) Limited, in whole or in part directly or indirectly represented any person’s proceeds of indictable offence, dealt with the said property.

4.  Charge 6 alleges Ms Chow, between 9 May 2008 and 13 January 2011, both dates inclusive, in Hong Kong, knowing or having reasonable grounds to believe that property, namely a sum of around $15,969,393.82 Hong Kong currency in the account numbered 438-820664-001 held under the name of Ms Chow with The Hongkong and Shanghai Banking Corporation Limited, in whole or in part directly or indirectly represented any person’s proceeds of indictable offence, dealt with the said property.

5.  Charge 7 alleges Ms Chow, between 14 January 2011 and 31 December 2011, both dates inclusive, in Hong Kong, knowing or having reasonable grounds to believe that property, namely a sum of around $2,423,500.00 Hong Kong currency in the account numbered 506-802248-001 held under the name of Ms Chow with The Hongkong and Shanghai Banking Corporation Limited, in whole or in part directly or indirectly represented any person’s proceeds of indictable offence, dealt with the said property.

6.  On the prosecution’s application, I ordered that all the other charges on the Charge Sheet be left on court file not to be reopened without the leave of this court or the Court of Appeal.

Facts admitted by Ms Chow

Ms Chow’s background

7.  Ms Chow lived with her husband and her daughter prior to her leaving Hong Kong and becoming out of reach from 2 July 2012 onwards until her arrest on 18 April 2019.

8.  On 3 July 2012, the Police arrested Ms Chow’s husband, Ms Chow’s daughter and other persons whose accounts had transactions with Ms Chow’s accounts. 

9.  Ms Chow’s accounts had numerous transactions in volume with various persons – namely (i) Ms Chow’s husband [WONG Wai-ip], (ii) Ms Chow’s daughter [WONG Ka-kay, Jessica], (iii) KWOK Yun-wah, (iv) WONG Kwok-chuen, (v) MAK Kwok-kwong and (vi) LEUNG Shun-wing.  They were all proceeded with “money laundering” offences in the District Court.  [See DCCC 591 of 2014 for (i) – (v), DCCC 444 of 2014 for (vi) – absconded.]

10.  Treasury Accountant examined the bank accounts and HKJC telebet accounts of those persons [as well as Ms Chow’s] and found that fund flow patterns in the accounts were not commensurate with their financial background and were indicative of illicit activities.

Charge 1 – HSBC savings account no. 438-820664-888 (“AC1”)

11.  Treasury Accountant noted this account displayed traits of being a temporary repository of funds.  Between 9 May 2008 and 13 January 2011, both dates inclusive, AC1 received deposits of a total of HK$ 36.9 million and all money deposited was subsequently withdrawn. 

12.  A total of HK$ 3.1 million, accounting for 8.4% were withdrawn on the day of deposit.  Another 20% of the funds were withdrawn in the following week.  In other words, approximately 28.4% of the deposits were withdrawn on the day of deposit or in the following week. 

13.  There were cash deposits of HK$ 10.9 million (29.6%) and cash withdrawals of HK$ 7.7 million (20.9%).

14.  The major sources of deposits included cash HK$ 10,943,823 (29.6%), another HSBC account of Ms Chow involving HK$ 5,765,000 (15.6%), Ms Chow’s husband involving HK$ 4,205,000 (11.4%), Ms Chow’s daughter involving HK$ 2.1 million (5.7%).

Charge 4 – BOC savings account No. 012-816-1-007294-8 (“AC4”)

15.  Treasury Accountant noted this account displayed traits of being a temporary repository of funds.  Between 6 May 2006 and 16 December 2010, both dates inclusive, the account received HK$ 47.8 million, all of which was withdrawn.  There were cash deposits of HK$ 9.6 million and cash withdrawals of HK$ 13.7 million.  Around HK$ 5.2 million, being 10% of the overall deposits, was withdrawn on the same day of deposit.  Another 30% of the funds were withdrawn in the following week.  In other words, approximately 40% of the deposits were withdrawn on the day of deposit or in the following week.

16.  The major sources of deposits are (i) cash [180 counts] being HK$ 9,629,323.40 [20.2%] and (ii) a person known as LEUNG Shun-wing [10 counts] being HK$ 2,976,900 [6.2%].

Charge 6 – HSBC current account no. 438-820664-001 (“AC6”)

17.  Treasury Accountant provided that for this AC6, the total deposit was HK$ 15,959,393.82 between 9 May 2008 and 13 January 2011, both dates inclusive. 

18.  The vast majority of the sums came from AC1 [HK$ 13,913,200 – 87.1%]. 

19.  The vast majority of the funds were withdrawn within the same day of deposit. 

Charge 7 – HSBC savings account no. 506-802248-001 (“AC7”)

20.  Treasury Accountant provided that AC7 received a total of HK$ 2.4 million with 99.6% sourced from another HSBC account of Ms Chow in 19 transactions between 14 January 2011 and 31 December 2011, both days inclusive.  Most of the deposits were withdrawn on the same day of deposit or in the following week.

21.  The transactions in all 4 subject accounts were not commensurate with Ms Chow’s background and her legitimate income.

Criminal record

22.  Ms Chow has two previous convictions in minor offence collected through one court appearance in 1995.

Antecedents

23.  Ms Chow is aged 57 (42-48 at the time of the offences), educated to lower secondary level, married and is a housewife.  She lives with her husband and 2 daughters and one son.

Mitigation

24.  Mr David Ma of counsel mitigated on behalf of Ms Chow.

25.  The following is a summary of the mitigation submissions.

26.  Mr Ma adopted the written submissions filed earlier to court.

27.  Mr Ma first asked the court to ignore the two minor previous convictions.

28.  Then Mr Ma supplied the missing pages of the Accountant Report to make Appendix 2 of the written submissions complete.

29.  Mr Ma said that the major money laundering accounts were AC1, AC4 and AC6 related respectively to Charges 1, 4, and 6; that these three accounts were closed 18-19 months before the arrest of Ms Chow’s husband who was the main culprit.

30.  Mr Ma submitted and hoped the court would accept that the predicate offence was unlawful bookmaking; however, Mr Ma suggested that there was no evidence she knew about the activities in her various accounts given that she was a mere housewife.

31.  Mr Ma submitted on the other hand that given her close relationship with her husband, she had reasonable grounds to believe that her husband was engaged in unlawful bookmaking and that her accounts were being used by her husband in related activities.

32.  Mr Ma submitted that before sentencing, the court should deduct (i) the sums of money double counted in the accounts involved for different charges, (ii) the sums of “backflowing” money and (iii) the legitimate income, from the amount of money stated in the particulars of the four charges.

33.  Mr Ma submitted that, after deduction, the amount of money involved will be reduced as follows:-

(a)  Charge 1 – from HK$36.9M to HK$35.5M;

(b)  Charge 4 – from HK$47.7M to HK$45.1M;

(c)  Charge 6 – from HK$15.9M to HK$2M; and

(d)  Charge 7 – from HK$2.4M to HK$1.2M.

34.  As the suggested reductions in respect of Charges 1 and 4 are insignificant and will make little difference to the sentence on this ground, I do not propose to set out the reasons therefor.

35.  As for Charge 6 (relating to AC6), it was submitted that a total deposit of HK$13.9M in AC6 came from AC1 which was the subject of Charge 1; therefore it was submitted that the sum of HK$13.9M ought to be deducted from the amount of money involved in Charge 6 to avoid double counting with the amount of money involved in Charge 1.

36.  As for Charge 7 (relating to AC7), it was submitted that the bulk of the amount of money involved in Charge 7 came from AC2 (related to Charge 2 – already left on court file).  It was submitted that a deposit HK$1.2M (out of a grand total deposit of HK$7.6M) involved in Charge 2 was income earned by Ms Chow’s husband working as an agent for the casinos in Macau (ie legitimate income), and therefore should be deducted from the amount involved in Charge 7.

37.  Mr Ma submitted that there is no tariff for the offence of “money laundering”; that in HKSAR v Boma [2012] 2 HKLRD 33, the Court of Appeal said that apart from the amount of money laundered, the court should take into account the following factors in sentencing “money laundering” cases:-

i.  the nature of and the penalty available for the predicate offence;

ii.  whether the predicate offence is known to the offender;

iii.  any international dimension;

iv.  the sophistication of the offence, including the degree of planning and whether deceit is practised to achieve the objective;

v.  whether the offence is committed by or on behalf of an organized criminal syndicate;

vi.  whether there is one transaction or many and the length of time over which the offence is committed;

vii.  whether the offender continues to launder funds after he or she has discovered as a fact that the funds are the proceeds of an offence or after he or she has discovered the nature of an offence which is serious; and

viii.  the role of the offender, and whether a benefit has been received and if so, the nature and size of the benefit.

38.  Mr Ma relied on the cases of HKSAR v Chan Wai Yan [2012] 4 HKLRD 195 and HKSAR v Lai Kam Yee Teresa [2010] 4 HKLRD 165 for one purpose only: Mr Ma seeks to argue there are special circumstances in the present case, just as there were in the two cases cited, that Ms Chow had committed the offences out of loyalty towards her husband, that she had only acted according to her husband’s instructions; on such basis, Mr Ma submitted that the court could exercise its discretion to give Ms Chow a further discount on her sentence.

39.  Despite indication from the court that the present case could be distinguished from the two cases cited on the basis that the special circumstances there were built upon evidence whereas here the submissions are simply based on bare assertions, Mr Ma after taking instructions replied that neither Ms Chow nor her husband Mr Wong Wai Ip will give evidence to support the claim of special circumstances, that Mr Ma will simply rely on the husband-wife relationship between Mr Wong and Ms Chow.

40.  Ms Chow is now 57 years old and she had studied up to Form One only. She has no criminal record relating to the offence of “money laundering”.  Indeed she has only one minor conviction 26 years ago relating to dutiable commodity, the subject matter was cigarettes.  She is a housewife and has two daughters and a son.  All of her three children have graduated from university.  Her two daughters are accountants while her son is now studying a PhD course.  On 7 May 2019, Ms Chow was diagnosed to have lung cancer .

41.  Ms Chow was arrested on 18 April 2019, reason being that she went to the US on 10 April 2012 with her son and stayed there to take care of him who was to commence his studying there.  When her husband was arrested on 3rd July 2012 for “money laundering” offences, he told Ms Chow not to return to Hong Kong and to stay in the US to take care of their son who was 15 years old at that time.  So, she did not return to Hong Kong.  When her son had grown up, she returned to Hong Kong in 2019 to surrender herself.  She was arrested when she checked in at the immigration.  In the premises, it is hoped that the court would accept that it was only because Ms Chow wanted to look after her son that she did not return to Hong Kong earlier.

42.  Overall speaking, the length of the charge periods for the four charges ranged from around one year to around four years and seven months.  These charge periods partly overlapped with each other.  For AC1 and AC6, they were respectively the savings account and the current account of the same bank account.

43.  It was suggested that the court could take into account the totality principle and adopt an overall starting point for sentence, and then pass sentences for respective charges which are to run concurrently.

Sentence

44.  Money laundering is a serious offence because it helps to funnel the ill-gotten gains of other serious offences and as such encourages and induces the commission of those other offences.  Indeed it can be respectively argued that a hard-lined hampering of money laundering activities by the handing down of deterrent sentences can greatly reduce the proliferation of pecuniary crimes.

45.  I have considered fully the mitigation submissions and the various instances of sentencing relied on by Mr Ma including:-

(a)  HKSAR v Lee Wai Yiu and Others, CACC 100/2006;

(b)  HKSAR v Oei Hengky Wiryo, CACC 109/2005;

(c)  香港特別行政區 訴 李煜鈞, DCCC 1110/2011; and

(d)  R v Yip Kam Fai & Anor, CACC 108/1993.

46.  These individual instances of sentencing do not assist much in my task of sentencing Ms Chow.

47.  I have also considered the case of HKSAR v Chan Kim Chung Nelson [2012] 2 HKLRD 263 which deals with the sentencing of a defendant who has been convicted both of the predicate offence and a connected money laundering offence.  Clearly, this cited case has no application to the case of Ms Chow who faces only money laundering charges.

48.  In the present case, I accept that the predicate offence is one of unlawful bookmaking.  I accept that Ms Chow at the very least had reasonable grounds to believe and did believe that the property she dealt with was proceeds of the unlawful bookmaking perpetrated in by her husband.

49.  However, I am unable to accept without evidence that such special circumstances as there were in Chan Wai Yan and Lai Kam Yee Teresa exist in the present case.  I will therefore not be able to exercise a discretion in Ms Chow’s favour to give her a special discount on the sentence.

50.  On the topic of “double-count”, I reject the submission that certain amounts ought to be deducted.  It is clear that the amount of money used for particularizing the four charges of money laundering was the amount deposited into the respective accounts.  The money laundering activity contemplated was the act of receiving the money into the account.  Each receipt was a separate money laundering activity.  In the case of Charge 6, the fact that the bulk of the money deposited into the account (AC6) came from AC1 (subject of Charge 1) does not detract from the fact that there was a separate set of money laundering activities; and this is so even allowing for the fact that AC6 is the related current account of the primary savings account (AC1) of an integrated account.  Having said that, a degree of concurrency in sentences is permissible between Charges 1 and 6.

51.  In the case of Charge 7, even accepting that the sum of HK$1.2M within AC2 was income earned by Ms Chow’s husband working as an agent for the casinos in Macau (ie legitimate income), there is no evidence to suggest that it was this sum (and not any other amounts within AC2) which was transferred from AC2 into AC7 (subject of Charge 7).  Hence, again, there cannot be any deduction.

52.  On the Boma considerations, I am satisfied that there is no evidence of international dimension; that there is little sophistication in the commission of the offences; that in view of the related prosecution in the case of her husband and others in HKSAR v Wong Wai Ip & Ors, and HKSAR v Mak Kwok Kwong, both of DCCC 591/2014, the offences were committed on behalf of a sizeable criminal syndicate; that there were multiple transactions and the longest period during which money laundering activities took place was 4 years 7 months (Charge 4); that given her relationship with her husband Ms Chow did at least believe that the property she continued to deal with was proceeds of her husband’s unlawful bookmaking activities; that it is clear that irrespective of whether she herself has personally benefitted from the offences, it could still be said that the family of which she was a part has benefitted from the joint activities of her husband’s unlawful bookmaking and the associated money laundering conducted by herself: in this connection, one cannot fail to notice the four subject accounts are littered with outgoings such as insurance payments, credit card payments, loan repayment, fund payment, jewelry and motor spending all of which were quite substantial.

53.  In sentencing Ms Chow, I feel able to take a global view of the matter. The total period of the four charges spanned from 6 May 2006 to 31 December 2011, a period of 5 years 7 months.  The total amount laundered was HK$102.9M. I bear in mind Charges 1 and 6 relate to the primary savings account and the current account respectively of the same integrated account.  I bear in mind the principle of totality.  I bear in mind the predicate offence is unlawful bookmaking the maximum sentence for which is 7 years’ imprisonment and I also bear in mind the relevant Boma considerations.

54.  Having taken into account the above matters, I adjudge a global starting point of 4 years to be appropriate.  Ms Chow pleaded guilty and so is entitled to the full 1/3 discount.

55.  Ms Chow was diagnosed with lung cancer in May 2019 but post-operatively she has been well and follow-up CT scans showed no evidence of recurrence. Taking into account Ms Chow’s de facto clear record, and in order to facilitate an early reunion with her family, I will allow a further one-month discount after the 1/3 sentence reduction.  The result came to 2 years and 7 months’ imprisonment.  I can find no other mitigating factors of sufficient weight to warrant any further discounts.

56.  I will impose the following individual sentences after plea on Ms Chow.

(Ms Chow, please stand)

57.  For Charge 1, Ms Chow will serve a sentence of 2 years’ imprisonment.

58.  For Charge 4, Ms Chow will serve a sentence of 2 years’ imprisonment.

59.  For Charge 6, Ms Chow will serve a sentence of 16 months’ imprisonment.

60.  For Charge 7, Ms Chow will serve a sentence of 12 months’ imprisonment.

61.  I order that 4 months of the sentence for Charge 4, 1 month of the sentence for Charge 6 and 2 months of the sentence for Charge 7 are to be served consecutively to each other, and the result is to run consecutively to the sentence for Charge 1, making an aggregate sentence of 31 months’ or 2 years 7 months’ imprisonment.