HKSAR v. WONG HAU TING

DCCC 646/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 646 OF 2010

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REASONS FOR SENTENCE

1.  The defendant stands convicted after trial of one charge that between the 1st January 2007 and the 27th February 2009 she dealt with property knowing or believing the property represented the proceeds of an indictable offence, contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Chapter 455.

2.  Briefly between the 1st January 2007 and the 27th February 2009 the total sum of HK$7,733,030 was deposited into the defendant’s savings account of which HK$7,732,018 was withdrawn in the same period. 

3.  An analysis of the transactions during this period showed, inter alia, there was 96 cash deposits of between $100 and $300,000, which totalled $2,522,888.50; and 177 bank transfers totalling $5,204,983.59.  In the same period there were a total of 333 withdrawals of which 151 were cash withdrawals, ranging from $300 to $240,000 and totalling $4,711,900 and 177 were transfer withdrawals totalling $3,019,918.80.  Of these transactions there were 70 occasions when multiple transactions took place on the same day, with both deposits and withdrawals on most occasions.

4.  By reason of the amount, frequency and manner of the transactions, and the fact that no tax returns were filed by the defendant in the relevant period, only employer’s returns showing total earnings of $101,258 for the period 1st February 2008 to the 31st March 2009, I was satisfied there were reasonable grounds to believe that the monies deposited in the savings account, save for the sum $45,061.59 representing salary from SASA, in whole or in part, directly or indirectly represented any person’s proceeds of an indictable offence.  Full particulars are set out in my verdict delivered earlier today. 

5.  Money laundering is a serious offence for which deterrent sentences are required (see HKSAR v XU Xia-li & another [2004] 4 HKC 16 at paragraph 18).  In HKSAR v Javid Kamran CACC 400/2004 the court, stressing the need for deterrent sentences, said that it was not possible to lay down guidelines, as there is a very wide range of culpability.  The court identified a number of factors relevant in determining the culpability of a defendant, including the nature of the offence that generated the laundered money, the extent to which the offence assisted the crime or hindered its detection, the degree of sophistication of the offence and perhaps the defendant's participation, including the length of time the offence lasted and the benefit he derived from the offence. 

6.  In Secretary for Justice v Jerome Yuval Arnold Herzberg [2010] 1 HKLRD 502 the Court of Appeal said that other relevant factors are the amount of money involved; the degree of sophistication of the operation; the defendant’s knowledge of the underlying offence and whether there was an international element to the commission of the offence.

7.  In HKSAR v HSU Yu-yi [2010] 5 HKLRD 545 the Court of Appeal reviewed a number of cases, includingXU Xia-li and Javid Kamran. The court at paragraph 13 highlighted five factors to be considered in determining sentence:

(1) It is the amount of money involved that is a major consideration and not the amount of benefit received by a defendant in the transaction.

(2) The culpability of the offence lies in the assistance, support and encouragement offered to the commission of an indictable offence. So a defendant's level of participation and the number of occasions on which he is involved in the ‘money laundering' activities are relevant factors to be considered.

(3) The offence of dealing with the proceeds from an indictable offence does not necessarily have any direct correlation with the indictable offence in question. However if the relevant indictable offence can be identified, the court may take into account the sentence imposed on the indictable offence pre se when determining the sentence of the dealing offence.

(4) If the case has an international element involving activities carried out across different regions, the court may impose a more severe sentence. This is to protect Hong Kong's reputation as an international finance and banking hub from being tarnished.

(5) The length of time the offence lasted.

8.  In passing sentence I take into account everything said on behalf of the defendant by Mr Kwan.  I take into account the defendant has no previous convictions.

9.  Mr Kwan submits the defendant played a small role, albeit an important role.  The defendant’s role was not limited to just allowing her savings account to be used.  The defendant also assisted in withdrawing substantial sums of money both in cash and by way of transfer, which transactions only the account holder could make. 

10.  Mr Kwan further submits there is no evidence that the defendant was involved in the illegal activity or that she benefitted from allowing her account to be used.  Whilst some of the money was the proceeds of bookmaking,the nature of the indictable offence from which the money was derived should be of no particular significance in sentencing, save that if the defendant knew the money was derived from very serious crimes, it would be an aggravating feature (see XU Xia-li at paragraph 11).  This approach has been followed, for example, in HKSAR v CHEN Szu-ming CACC 270/2005 and HKSAR v YAM Kong-lai [2008] 5 HKLRD 384, the courts emphasising that the defendant is to be sentenced on the facts of the money laundering charge only and not on the facts of the underlying offence. 

11.  Whether or not the defendant received a reward is insignificant as a sentencing factor for the reality is the offence of money laundering is very serious (see HKSAR v CHEN Szu-ming at paragraph 23).  As seen in the recent cases of HSU Yu-yiand HKSAR v HOU Shun-hsiungCACC 472/2009 the amount of money involved is a major consideration and not the amount of benefit received by a defendant.

12.  The lending of bank accounts facilitates money laundering by disguising the true owner of the money and thus making difficult the detection of crime, whilst at the same time undermining the integrity of the banking system by allowing someone other than the true holder of the account to use the account.  I am satisfied a deterrent sentence is required

13.  The cases reviewed in HSU Yu-yi show that a starting point of between 3 and 5 years imprisonment has been applied to amounts ranging between $1 and $15 million.  Taking into account that over a period of just over 2 years the defendant dealt with substantial sums of money totalling almost HK$7.7 million I am satisfied a sentence of 3 years imprisonment is appropriate. 

14.  I reduce the sentence by 3 months imprisonment by reason of the fact the defendant has a clear record and that the whole of the prosecution case was agreed (see XU Xia-li at paragraph 38).  

15.  The defendant is sentenced to 2 years and 9 months imprisonment.