HKSAR v. SUM HO WAH HOWARD AND ANOTHER

HCMA 187/2017

[2018] HKCFI 1391

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO 187 OF 2017

(ON APPEAL FROM KCCC 2761 OF 2016)

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JUDGMENT

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1.  The 1^st Appellant Mr Sum and the 2^nd Appellant Madam Lau are husband and wife. With him as the 1^st Defendant and her as the 2^nd Defendant (which is how I will refer to them), they stood trial in the Magistrates’ Court on nine charges. Each of those nine charges was laid against both of them jointly.

2.  Charges 1 to 5, 7 and 9 were “substantive” charges of dealing with property known or believed to represent the proceeds of an indictable offence.  Amended Charges 6 and 8 were “attempt” charges of attempting to deal with property known or believed to represent the proceeds of an indictable offence.  The substantive charges were laid under section 25(2) and (3) of the Organized and Serious Crimes Ordinance (Cap 455).  The attempt charges were laid under those provisions and section 159G(1) of the Crimes Ordinance (Cap 200).

3.  Each Defendant was acquitted on one charge, namely Amended Charge 8, and convicted on the other eight charges, namely Charges 1 to 5, Amended Charge 6, Charge 7 and Charge 9.

4.  The substantive charges involved withdrawals from ATM machines while the attempt charges involved attempted withdrawals from ATM machines. The details of these withdrawals and attempted withdrawals are given by the Magistrate in the part of his Statement of Findings where he says as follows:

“ 4. Charges (1) to (4) related to 4 separate withdrawals that took place on 2^nd September 2012. The allegation was that the 1^st and the 2^nd Defendants withdrew cash 4 times, in the amount of HK$6,000, HK$4,500, HK$7,600 and HK$13,500 respectively, from bank accounts belonging to others via some Hang Seng Bank ATM machines in the Shatin MTR Station.

5.  Charges (5), (7) and (9) related to 3 separate withdrawals that took place on 3^rd February 2013.  The allegation was that the 1^st and the 2^nd Defendants withdrew cash 3 times, in the amount of HK$20,000, HK$13,100 and HK$20,000 respectively, from bank accounts belonging to others via some HSBC ATM machines in the Lo Wu MTR Station.

6.  Amended Charges (6) and (8) related to 2 uncompleted withdrawals that took place also on 3^rd February 2013.  The allegation there was that the 1^st and the 2^nd Defendants attempted to withdraw cash 2 times from bank accounts belonging to others via HSBC ATM machines in the Lo Wu MTR Station, but they did not get any money in these 2 withdrawals.”

5.  Each Defendant was sentenced to a total of 7 months’ imprisonment.

6.  They both filed notices of appeal against all of their convictions and against their sentences.  Both appeals against sentence have been abandoned.  I am now only concerned with the appeals against conviction.

7.  Under the heading “The Prosecution case”, the Magistrate said as follows in his Statement of Findings:

“ 8.  The Prosecution case was that, in each and every Charge the 1^st and the 2^nd Defendants acted as a ‘basic joint enterprise’ and were in ‘it’ together—‘it’ being an understanding between them to carry out the withdrawals, which were money laundering activities.

9.  The parties were also able to agree on a number of trial exhibits including the following:

(i)   Certified English translation of Police notebook entries made by DPC 33736 (Exh. P7);

(ii)   A disc containing the video recorded interview in respect of the 2^nd Defendant which was held on 4^th December 2013, the date of her arrest (the ‘VRI’) (Exh. P11);

(iii)   Certified English transcript of the VRI (Exh. P13);

(iv)   A disc containing CCTV footages of 2^nd September 2012 (between 20:13 and 20:43 hours) in the vicinity of Hang Seng Bank ATM machines in the Shatin MTR Station (Exh. P14);

(v)   A disc containing CCTV footages of 3^rd February 2013 (between 21:29 and 21:52 hours) in the vicinity of HSBC ATM machines in the Lo Wu MTR Station (Exh. P15);

(vi)   8 still photographs captured from the Shatin CCTV footages (Exh. P27); and

(vii)   8 still photographs captured from the Lo Wu CCTV footages (Exh. P28).

10.  In fact, the 1^st and the 2^nd Defendants were able to agree with almost the entirety of the Prosecution evidence and there was the need to call just one Prosecution witness. 

11.  This witness was policeman DPC 4982 (‘PW1’), who was the Investigating Officer in a Police operation which was mounted in 2012.  His evidence was short.  He was able to identify both the 1^st and the 2^nd Defendants in court.  He told that he had met these two Defendants on many occasions, including those before the operation turned overt in 2013.

12.  PW1 was the one who captured the 8 still photographs (Exh. P27) from the Shatin CCTV footages (Exh. P14), and the 8 still photographs (Exh. P28) from the Lo Wu CCTV footages (Exh. P15).  While PW1 testified, relevant sections of CCTV footages in Exh. P14 and Exh. P15 were played in court.  After viewing the footages, PW1 said he believed the man and the woman appearing together in the footages were the 1^st and the 2^nd Defendants in this case.

13.  Counsel for the 1^st Defendant simply put to PW1 that his belief that the 1^st Defendant was the male in the two sets of CCTV footages was wrong.  PW1 disagreed.

14.  Counsel for the 2^nd Defendant did not cross examine PW1 at all.

15.  The Prosecution accepted that, in each Charge, on the evidence, it was impossible to distinguish the role played by the 1^st Defendant from that played by the 2^nd Defendant in the joint enterprise.”

8.  Having said that, the Magistrate dealt with the submission of no case to answer made on 2^nd Defendant’s behalf, which he rejected, saying as follows:

“16. After PW1’s testimony the Prosecution closed their case. At that stage Counsel for the 2^nd Defendant made a no case submission in respect of Charges (6) to (9), advancing, in gist, the following arguments:

(i)   There was no evidence that the 2^nd Defendant had committed any overt acts indicating that she had dealt with any funds in those withdrawal incidents. She was merely present in the vicinity of her husband, and ‘mere presence’ was not the actus reus required to prove a criminal offence;

(ii)   The Prosecution were asking the Court to infer that the reason why the 2^nd Defendant was present at the time the 1^st Defendant committed the offence was because there was an agreement between them to deal with the funds of the bank accounts. But spouses could not commit conspiracies together; and

(iii)   As to Amended Charges (6) and (8), as they were framed in attempts, the law required a Judge to direct the hypothetical Jury to ignore an examination of the ‘reasonable grounds to believe’ limb. The hypothetical Jury could only convict if they found the 2^nd Defendant had a ‘specific intent’ to deal with the proceeds of an indictable offence. Here, the Prosecution could not prove this ‘specific intent’.

17.  After consideration I ruled against the 2^nd Defendant on the following grounds:

(i)   The two Defendants were jointly charged.  The Prosecution case was that the two of them acted in a joint enterprise in respect of each incident as represented by each of Charges (6) to (9);

(ii)   The existence of the joint enterprise and the 2^nd Defendant’s participation in it were all matters for the Jury;

(iii)   The presence of a party of the joint enterprise at the scene of the crime may lead to an irresistible inference of a joint enterprise: see para. 17-13A, Archbold Hong Kong 2017;  

(iv)   The mens rea element of the 2^nd Defendant at the time of the commission of Charges (6) to (9) may also be inferred from primary facts of the case, albeit Amended Charges (6) and (8) were attempt offences;

(v)   At the half time stage, there was some evidence that the 2^nd Defendant had participated in the commission of Charges (6) to (9);

(vi)   Such evidence of primary facts was of a quality permitting the Jury to accept it; and

(vii)   A Jury properly directed could or might be satisfied beyond reasonable doubt that inferences of the following could be drawn: (a) a joint enterprise having existed between the two Defendants; (b) the 2^nd Defendant having participated in it; and (c) the 2^nd Defendant having the requisite mens rea.

18.  After consideration, I ruled that there was a prima facie case for each of the two Defendants to answer in respect of all the 9 Charges.”

9.  Neither defendant gave or called evidence.

10.  The Magistrate said that the 1^st Defendant’s “main defence” was one of identity, the question being whether the prosecution could “prove that the 1^st Defendant was the male captured in the relevant sections in the Shatin CCTV footages (Exh. P14) and the Lo Wu CCTV footages (Exh. P15)”.

11.  As for the 2^nd Defendant, the Magistrate said this:

“22. Apart from the arguments advanced in the half time stage, Counsel for the 2^nd Defendant also submitted that the 2^nd Defendant did not know and did not have reasonable grounds to believe that the funds were proceeds of an indictable offence. Counsel said the answers in the VRI supported the 2^nd Defendant’s case.”

12.  The Magistrate then referred: to the criminal burden and standard of proof; to having carefully watched PW1’s demeanour when he testified; to no adverse inference being drawn against the Defendants for exercising their rights not to testify; to having considered all the evidence, exhibits and oral and written submissions of the parties; and to having reminded himself that neither Defendant had any previous conviction in Hong Kong.

13.  As to the 2^nd Defendant’s VRI, neither the voluntariness nor the accuracy of which were in dispute.  The Magistrate noted that it contained exculpatory parts as well as some admissions.  Having considered the matter, he rejected the exculpatory parts of the VRI and the exculpatory statement under caution upon arrest that she had not asked her husband the purpose of the withdrawals.

14.  The Magistrate set out the following admissions in the VRI as ones which he considered “significant”:

“ (i)   In the past, may be for 1 year or 2 years (not more than 10 times), the 2^nd Defendant had helped her husband to withdraw money using other people’s bank cards. The money withdrawn did not belong to her husband. When the 2^nd Defendant did the withdrawal, she would ask her husband for the personal identification number. On each occasion, the withdrawal was $20,000 because the limit for each card is $20,000—but not necessarily $20,000 could be withdrawn—at most $20,000 could be withdrawn. For all those 10 times, the personal identification number was the same;

(ii)   The 2^nd Defendant admitted that, from the still photographs made from CCTV footages of 2^nd September 2012 (8:22pm – 8:25pm) in the vicinity of Hang Seng ATM machines at the Shatin Station, the 1^st and the 2^nd Defendants could be identified from the photographs; and

(iii)   The 2^nd Defendant also admitted that, from the still photographs made from CCTV footages of 3^rd February 2013 (9:38pm – 9:43pm) in the vicinity of HSBC ATM machines at the Lo Wu Station, the 1^st and the 2^nd Defendants could be identified from the photographs.”

15.  On the matter of identification, the Magistrate said as follows:

“41. When PW1 testified, relevant sections of CCTV footages of the two occasions at Shatin and Lo Wu MTR stations were played in court. After viewing the footages, PW1 said he believed the man and the woman appearing together in the recording were the 1^st and the 2^nd Defendants.

42. I directed myself that, where the case against a defendant depends to a large extent on the correctness of identifications of him or her, which the defence alleges to be mistaken, there is the special need for caution on the evidence of identification. A witness who is convinced in his own mind may, as a result, be a convincing witness, but he may nevertheless make a mistaken identification.

43. As to PW1’s evidence of identification, he said he was the investigation officer in the Police operation which started in 2012. He said he had met the 1^st and the 2^nd Defendants on many occasions, including those before the operation turned overt in 2013. So the encounters that PW1 had with the two Defendants were not ‘fleeting’. PW1 gave clear and direct evidence. I accepted his evidence of identification and I gave weight to it.

44. Further, still photograph P28(8) captured the 1^st Defendant’s face rather clearly when he was in Lo Wu. I did not think the photograph was of a bad quality. Although in that photograph the 1^st Defendant’s head turned slightly to his left, one could still see his facial features clearly. I had myself paid attention to the 1^st Defendant’s appearance when he was before me. In the trial, he was not wearing glasses, had a beard and long, curly hair. But judging from his facial features, in particular his eyes and cheeks, I was convinced that the man in photograph P28(8) is the 1^st Defendant.

45. As to the 2^nd Defendant, still photographs P27(1) and (4) captured her face rather clearly that night in Shatin. Still photographs P28(3), (4) and (5) captured her face also clearly when she was in Lo Wu. I had also paid attention to the 2^nd Defendant’s appearance when she was before me. I was convinced the woman in those photographs is the 2^nd Defendant here. After all, the 2^nd Defendant admitted in the VRI that she did appear in the photographs captured from the CCTV footages on both occasions.

46. I therefore ruled that the Prosecution had proven the 1^st and the 2^nd Defendants’ identity on the 2 occasions beyond reasonable doubt.”

16.  The Magistrate then turned to the question of whether the two Defendants were acting in concert.  He found that they were, saying as follows:

“47. One can see from the Shatin CCTV footages of 2^nd September 2012 inter alia the following images:

(i) The 1^st Defendant and the 2^nd Defendant were each using an ATM machine;

(ii) The 1^st Defendant took the cash from the ATM, then he inserted another card into the machine; and

(iii) The 1^st Defendant moved over to mind the ATM machine the 2^nd Defendant was using (the 2^nd Defendant holding cash in her hand), and the 2^nd Defendant took the cash that came out from the ATM machine the 1^st Defendant was using.

48. Clearly, on this occasion, both Defendants took active parts in withdrawing cash from the ATM machines.  It would be wrong to describe that, one of the Defendants was ‘merely present’ at the ‘scene of crime’ (so to speak). The only reasonable inference was that the 2 Defendants acted in concert on the night of 2^nd September 2012.

49. Counsel for the 2^nd Defendant argued that all the Charges were effectively conspiracy Charges because, for the Prosecution to secure a conviction, the mens rea and actus reus they relied upon were implied by an earlier agreement and a husband and wife could not, in law, commit a conspiracy unless a third party was also involved.

50. However, the 1^st and the 2^nd Defendants were jointly charged for all the offences, which were not conspiracy offences.  Learned Counsel had not produced to the Court any authority to show that a husband and his wife, just the two of them, could not be jointly charged; or any authority to support his claim that a husband and his wife, just the two of them, could not be alleged to have formed a joint criminal enterprise.  As was said by Ribeiro PJ in HKSAR v Chan Kam Shing (2016), FACC 5/2016, the Court of Final Appeal, at para.33, liability in a joint criminal enterprise is independently based on each defendant’s participation in the joint enterprise with the requisite mental state to constitute the offence relevant to the defendant in question.  I did not think a husband and his wife could not, in law, form a joint criminal enterprise.

51. As to the Lo Wu CCTV footages of 3^rd February 2013, one can see inter alia the following images:

(i) The 1^st Defendant handed a card to the 2^nd Defendant, then the 2^nd Defendant inserted it into an ATM machine;

(ii) The 2^nd Defendant took the cash that came out from the machine, and went over to where the 1^st Defendant was;

(iii) The 2^nd Defendant showed some bank notes to the 1^st  Defendant, and then gave him the bank notes;

(iv) The 1^st Defendant passed one card to the 2^nd Defendant while he was still using an ATM;

(v) The 1^st Defendant and the 2^nd Defendant were each using an ATM, side by side; and

(vi) The 2^nd Defendant finished using the ATM, with no money coming out, she then gave that bank card to the 1^st Defendant.

52. Again, on this occasion, both Defendants took active parts in withdrawing cash from the ATM machines.  It would be wrong to describe that, one of the Defendants was ‘merely present’ at the ‘scene of crime’ (so to speak).  The only reasonable inference was that the 2 Defendants acted in concert on the night of 3^rd February 2013.”

17.  As to the substantive charges, being Charges 1 to 5, 7 and 9, the Magistrate said this:

“54. In respect of these Charges, money was successfully withdrawn from the following bank accounts on 2^nd September 2012 and/or 3^rd February 2013:

(i) Chui Tsz Lam’s HSBC account no. 179-798269-292 (Charge (1));

(ii) Chui Tsz Lam’s Hang Seng Bank account no. 255-487464-668 (Charge (2));

(iii) Chung Sai Wing’s Hang Seng Bank account no. 255-8-043291 (Charges (3) and (5));

(iv) 141 Information Technology Limited’s HSBC account no. 561-788712-838 (Charges (4) and (7)); and

(v) Tang Ka Leung’s Hang Seng Bank account no. 249-5-071751 (Charge (9)).

55. The withdrawal of money from these bank accounts comes within the statutory meaning of ‘dealing’ in s.2 of the Organised and Serious Crimes Ordinance, Cap.455.

56. As the 1^st Defendant and the 2^nd Defendant were acting in concert, it mattered not what part each had played in the act of ‘dealing’.  It mattered not whether it was the 1^st Defendant or the 2^nd Defendant who took the cash coming out from the ATM, while the other one was standing at a side—both were equally guilty: see Chan Kam Shing, the Court of Final Appeal, paras.32 – 41.”

18.  As to what he called “the mens rea part of the offences”, the Magistrate dealt with the substantive charges, each of which he found proved beyond reasonable doubt, one by one.

19.  On Charge 1 the Magistrate said this:

“58. Charge (1) concerned Chui Tsz Lam’s HSBC account no. 179-798269-292, in respect of which I made the following findings:

(i) On the night of 2^nd September 2012, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 20:28:58, one or both of them withdrew $6,000 from this bank account via Hang Seng Bank ATM no. 4A97 at Shatin MTR Station;

(iii) This was a bank account belonging to another;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 2^nd September 2012; and

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on the same day, the bank card and password access to another bank account held by the same Chui Tsz Lam at Hang Seng Bank.

59. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 2^nd September 2012, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $6,000 in whole or in part directly or indirectly represented proceeds of an indictable offence.”

20.  On Charge 2 the Magistrate said this:

“60. Charge (2) concerned Chui Tsz Lam’s Hang Seng account no. 255-487464-668, in respect of which I made the following findings:

(i) On the night of 2^nd September 2012, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 20:19:11, one or both of them withdrew $4,500 from this bank account via Hang Seng Bank ATM no. 4A96 at Shatin MTR Station ;

(iii) This was a bank account belonging to another;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 2^nd September 2012;

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on the same day, the bank card and password access to another bank account held by the same Chui Tsz Lam at HSBC;

(viii) A bank card of this Hang Seng Bank account (Exh. P2) was found in the 1^st Defendant’s office on 4^th December 2013, the date of his arrest ; and

(ix) An e-banking security device of this account (Exh. P9) was found in the Defendants’ home on 4^th December 2013.

61. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 2^nd September 2012, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $4,500 in whole or in part directly or indirectly represented proceeds of an indictable offence.

62. I paused to note a submission which was advanced on the 1^st Defendant’s behalf that, in relation to Exhs. P2, P3, P4 and P5 that were found by the Police in the 1^st Defendant’s work place, the Prosecution had not eliminated the possibility that these bank cards and passbook could have been placed in the office by other people such as the members of staff.  It was also submitted that, in relation to Exhs. P8, P9 and P10 that were found in the Defendants’ home, there was no evidence that these items were found in areas of the residence to which only the 1^st Defendant had access. 

63. With respect, this argument could not stand if one took notice of the fact that Exhs. P2 and P9 belonged to the same person, i.e. Chui Tsz Lam.  Exh. P2 was found in the 1^st Defendant’s office, whereas Exh. P9 was found in his home.  Exhs. P3 and P10 belonged to 141 Information Technology Limited.  Exh. P3 was found in the 1^st Defendant’s office, whereas Exh. P10 was found in his home.  Exhs. P4, P5 and P8 belonged to Tang Ka Leung.  Exhs. P4 and P5 were found in the 1^st Defendant’s office, whereas Exh. P8 was found in his home.”

21.  On Charge 3 the Magistrate said this:

“64. Charge (3) concerned Chung Sai Wing’s Hang Seng Bank account no. 255-8-043291, in respect of which I made the following findings:

(i) On the night of 2^nd September 2012, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 20:29:37, one or both of them withdrew $7,600 from this bank account via Hang Seng Bank ATM no. 4A97 at Shatin MTR Station;

(iii) This was a bank account belonging to another;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 2^nd September 2012; and

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 3^rd February 2013, the bank card and password access to this bank account.

65. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 2^nd September 2012, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $7,600 in whole or in part directly or indirectly represented proceeds of an indictable offence.”

22.  On Charge 4 the Magistrate said this:

“66. Charge (4) concerned 141 Information Technology Limited’s HSBC account no. 561-788712-838, in respect of which I made the following findings:

(i) On the night of 2^nd September 2012, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 20:30:03, one or both of them withdrew $13,500 from this bank account via Hang Seng Bank ATM no. 4A96 at Shatin MTR Station;

(iii) This was a bank account belonging to another—from the company information disclosed at Banker’s Affirmation Exh. P20, neither the 1^st Defendant nor the 2^nd Defendant had any connection with this company;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 2^nd September 2012;

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 3^rd February 2013, the bank card and password access to this bank account;

(viii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 3^rd February 2013, the bank card and password access to another bank account held by the same company at Hang Seng Bank; and

(ix) A bank card of this bank account (Exh. P3) was found in the 1^st Defendant’s office on 4^th December 2013.

67. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 2^nd September 2012, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $13,500 in whole or in part directly or indirectly represented proceeds of an indictable offence.”

23.  On Charge 5 the Magistrate said this:

“68. Charge (5) concerned Chung Sai Wing’s Hang Seng Bank account no. 255-8-043291, in respect of which I made the following findings:

(i) On the night of 3^rd February 2013, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 21:39:20, one or both of them withdrew $20,000 from this bank account via HSBC ATM no. 5220 at Lo Wu MTR Station

(iii) This was a bank account belonging to another;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 3^rd February 2013; and

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 2^nd September 2012, the bank card and password access to this bank account.

69. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 3^rd February 2013, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $20,000 in whole or in part directly or indirectly represented proceeds of an indictable offence.”

24.  On Charge 7 the Magistrate said this:

“70. Charge (7) concerned 141 Information Technology Limited’s HSBC account no. 561-788712-838, in respect of which I made the following findings:

(i) On the night of 3^rd February 2013, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 21:41:01, one or both of them withdrew $13,100 from this bank account via HSBC ATM no. 5394 at Lo Wu MTR Station;

(iii) This was a bank account belonging to another—from the company information disclosed at Banker’s Affirmation Exh. P20, neither the 1^st Defendant nor the 2^nd Defendant had any connection with this company;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 3^rd February 2013;

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 2^nd September 2012, the bank card and password access to this bank account;

(viii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 3^rd February 2013, the bank card and password access to another bank account held by the same company at Hang Seng Bank; and

(ix) A bank card of this account (Exh. P3) was found in the 1^st Defendant’s office on 4^th December 2013.

71. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 3^rd February 2013, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $13,100 in whole or in part directly or indirectly represented proceeds of an indictable offence.”

25.  On Charge 9 the Magistrate said this:

“72. Charge (9) concerned Tang Ka Leung’s Hang Seng Bank account no. 249-5-071751, in respect of which I made the following findings:

(i) On the night of 3^rd February 2013, the 1^st and the 2^nd Defendants acted in concert;

(ii) At about 21:42:51, one or both of them withdrew $20,000 from this bank account via HSBC ATM no. 5220 at Lo Wu MTR Station

(iii) This was a bank account belonging to another

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 3^rd February 2013;

(vii) A bank card of this bank account (Exh. P4) and a passbook (Exh. P5) were found in the 1^st Defendant’s office on 4^th December 2013; and

(viii) An e-banking security device of this account (Exh. P8) was found in the Defendants’ home on 4^th December 2013.

73. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 3^rd February 2013, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the $20,000 in whole or in part directly or indirectly represented proceeds of an indictable offence.”

26.  Turning to the attempt charges, Amended Charges 6 and 8, the Magistrate said this about Amended Charge 6:

“76. Amended Charge (6) concerned 141 Information Technology Limited’s Hang Seng Bank account no. 789-612520-883, in respect of which I made the following findings:

(i) On the night of 3^rd February 2013, the 1^st Defendant and the 2^nd Defendant acted in concert;

(ii) At about 21:40:21, one or both of them sought to withdraw $20,000 from this bank account via HSBC ATM no. 5394 at Lo Wu MTR Station, but the request was rejected as there were insufficient funds;

(iii) This was a bank account belonging to another;

(iv) As can be seen from the CCTV footages, the 1^st Defendant was the one who was keeping the bank cards—the only reasonable inference was that he knew this bank account belonged to another;

(v) The 2^nd Defendant admitted in the VRI that, when she withdrew the money from the ATM, she knew that the money came from someone other than her husband;

(vi) The 1^st Defendant and the 2^nd Defendant, acting in concert and having the bank card and password access, had the control over the money sitting in this bank account of another on 3^rd February 2013;

(vii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 2^nd September 2012, the bank card and password access to another bank account held by the same company at HSBC;

(viii) The 1^st Defendant and the 2^nd Defendant, acting in concert, had, on 3^rd February 2013, the bank card and password access to this HSBC bank account;

(ix) A bank card of this Hang Seng Bank account (Exh. P1) was found on the 1^st Defendant’s body on 4^th December 2013; and

(x) A deposit card of this Hang Seng Bank account (Exh. P10) was found in the 1^st Defendant’s home on 4^th December 2013.

77. From all these, in the absence of any acceptable evidence to the contrary, the only reasonable and irresistible inference was that, on 3^rd February 2013, the 1^st Defendant and the 2^nd Defendant either knew or had reasonable grounds to believe that the money sitting in this 141 Information Technology Limited’s Hang Seng Bank account in whole or in part directly or indirectly represented proceeds of an indictable offence.

78. Counsel for the 2^nd Defendant submitted that the Court could not, in an attempt charge, convict the 2^nd Defendant on the basis that she only had reasonable grounds to believe (that is, lacking the requisite knowledge) that the funds were the proceeds of an indictable offence.  But learned Counsel’s submission is un-supported by any authority. The case he submitted, HKSAR v Kan Chung Hung [2001] 3 HKLRD 834, is a case on the offence of an attempt to export un-manifested cargo, i.e. an attempt to commit a strict liability offence.  The attempt there was of a totally different nature, and, with respect, the case did not help learned Counsel.

79. I viewed the matter this way—the 1^st Defendant and the 2^nd Defendant, acting in concert, had the intention to deal with the money sitting in this 141 Information Technology Limited’s Hang Seng Bank account.  One of them, pursuant to their common intention, inserted the bank card into the ATM machine and keyed-in the request to withdraw $20,000 out of this account. There were, however, insufficient funds.  The insertion of the bank card into the ATM, and the keying-in of the request to withdraw money, were acts more than merely preparatory to the commission of the substantive s.25 offence.  They, acting in concert, did such acts either knowing or having reasonable grounds to believe that the money sitting in this 141 Information Technology Limited’s Hang Seng Bank account in whole or in part directly or indirectly represented proceeds of an indictable offence.

80. In the circumstances, I ruled that proof of Amended Charge (6) beyond reasonable doubt was established.”

27.  As to Amended Charge 8, the only charge on which he was acquitted, the Magistrate said this as to why he acquitted the Defendants on it:

“81. This Charge concerned Tang Ka Leung’s Hang Seng Bank account, the same account from which the Defendants successfully withdrew $20,000 on the same occasion (the subject matter of Charge (9)).

82. The reason for this uncompleted withdrawal in Amended Charge (8) was not apparent from Banker’s Affirmation Exh. P21. The Court could not be sure what the Defendants had done in this particular incident and whether it amounted to acts more than merely preparatory or not.

83. Further, there was the uncertainty that the 1^st Defendant and the 2^nd Defendant might have been charged with this uncompleted attempt offence in respect of this account, which they completed on another occasion on the same night in respect of the same account (Charge (9)).

84. I ruled, therefore, that the 1^st Defendant and the 2^nd Defendant were acquitted of Amended Charge (8).”

28.  Five amended perfected grounds of appeal against conviction have been filed on the 1^st Defendant’s behalf.  These are numbered 1 to 5 in the conventional way.

29.  Four amended perfected grounds of appeal against conviction have been filed on the 2^nd Defendant’s behalf.  Counsel who drafted these four grounds has designated them “Ground 1”, “Additional Ground 1A”, “Amended Ground 2” and “Additional Ground 3”.  Following these four grounds, there is a statement that ‘[t]he three grounds individually and/or cumulatively render the said convictions unsafe and unsatisfactory.”  I treat that reference to three grounds as a reference to four grounds.

30.  Ground 1 for the 1^st Defendant is about identification.  It reads:

“ The Learned Deputy Magistrate erred in finding that D1 was the male withdrawing money at the ATM machines as depicted in the CCTV footages, in that:

a. The CCTV footages did not capture recognizable features of the persons therein for a reliable identification; and

b. The CCTV footages were of poor quality for a reliable identification.”

31.  I have already quoted what the Magistrate said about identification in paragraphs 41 to 46 of his Statement of Findings.  He was well aware of the care with which this evidence had to be approached.  There was evidence on which he was able to come to the conclusion which he did on identification.  I find no proper basis on which to interfere with that conclusion reached by the Magistrate who received all the evidence at first-hand.  Ground 1 for the 1^st Defendant fails.

32.  Ground 2 for the 1^st Defendant is in relation to mens rea.  It reads:

“ Should D1 fail on Ground 1, the Learned Deputy Magistrate erred in finding that D1 had the requisite mens rea for the offence under s.25 of Cap.455, in that:

a. there was insufficient evidence or at all that the money in the bank accounts from which D1 withdrawn represented proceeds of an indictable offence (‘crime proceeds’) which would lead to any inference of the mens rea of D1;

b. there was insufficient evidence or at all that D1 knew the money he withdrawn being crime proceeds;

c. there was insufficient evidence or at all that D1 had reasonable grounds to believe that the money he withdrawn being crime proceeds;

(HKSAR v Wong Ping Shui (2001) 4 HKCFAR 29, 31; Oei Hengky Wiryo v HKSAR (No 2) (2007) 10 HKCFAR 98, [99]; HKSAR v Pang Hung Fai (2014) 17 HKCFAR 778, [49] [52] [57]; HKSAR v Yeung Ka Sing Carson (2016) 19 HKCFAR 279, [126–128])

d. deduced from the statement of findings, it appears that on the fact that the bank accounts belonged to another, the Learned Deputy Magistrate drew the only reasonable and irresistible inference that D1 knew the accounts belonged to another. On such knowledge, the Learned Deputy Magistrate further drew the only irresistible inference that either D1 knew or had reasonable grounds to believe that the money withdrawn were crime proceeds. The Learned Deputy Magistrate’s reasoning and logic is flawed and erroneous;

e. On the knowledge that the Learned Deputy Magistrate found of D1, it could open to different inferences. The more reasonable inference would be that D1 was committing theft by withdrawing money from bank accounts belonging to another. Hence, D1 had the mens rea for dealing with crime proceeds was not the only irresistible inference and the Learned Deputy Magistrate erred in so finding;

f. If D1 was committing the predicate offence of theft by withdrawing money from bank accounts belonging to another, he could not be at the same time guilty of the offence of dealing with the proceeds of his own crime, namely the money he had stolen;

(HKSAR v Li Kwok Cheung George (2014) 17 HKCFAR 319, [18], [19])

g. Theft and money laundering are mutually exclusive offences. The evidence of the present case is open to inferences of guilt of either offence. With the 2 offences being equally probable, the Prosecution failed to prove beyond reasonable doubt that D1 was committing laundering offences.

(AG of Hong Kong v Yip Kai Foon [1988] AC 642, 656 A–D; The Queen v Chan Po Cheung HCMA 1604/1990, paras. 9–13)

33.  As to the 1^st Defendant’s state of mind, the Magistrate said that the only reasonable inference on each charge is that the 1^st Defendant knew or had reasonable grounds to believe that the sums in whole or in part directly or indirectly represented a person’s proceeds of an indictable offence.  The Magistrate should have made up his mind as to which of those two states of mind existed.  I will not treat the more serious state of mind, namely knowledge, as having been found proved.  That leaves the less serious state of mind, namely reasonable grounds to believe.  The Magistrate came to what amounts to a conclusion that reasonable grounds to believe existed.  In coming to such a conclusion, the Magistrate obviously had regard to the whole of the evidence.  The evidence included evidence that the 1^st Defendant was in possession of the means by which to make withdrawals from all these accounts.  Subject to the suggestion made by counsel on the 1^st Defendant’s behalf that he might have been committing theft, there is no explanation as to how he came to be in possession of such means.  I find no proper basis on which to say that the Magistrate was not entitled to come to the conclusion that the 1^st Defendant was dealing with these sums with at least reasonable grounds to believe that they in whole or in part represented a person’s proceeds of an indictable offence.  The Magistrate obviously did not regard it as a reasonable inference that the 1^st Defendant might have been committing theft.  I do not think that in all the circumstances the Magistrate had to regard that as a reasonable inference.  Ground 2 for the 1^st Defendant fails.

34.  Ground 3 for the 1^st Defendant is essentially an assertion that the prosecution had failed to prove the absence of a lawful or proper basis for withdrawing the money in question.  It reads:

“ In the event that it is held that the identification of D1 is not in error, in determining whether or not D1 dealt in the proceeds of an indictable offence, the learned Magistrate erred in his conclusion because the prosecution failed to prove that D1 had no lawful or proper basis for withdrawing the money from the ATM machines the subject of the proceedings. In particular, the learned Magistrate had no evidence available to him as to the nature of the business or occupation of D1 and in drawing the inference that he did, the learned Magistrate failed to observe the strictures of Li Defan v HKSAR (2003) 5 HKCFAR 320 and as the application of that case was explained in HKSAR v Siu Mo Nor [2005] 3 HKC 131 and HKSAR v Leung Chi Wah & Yung Ka Tim CACC 275/07.”

35.  A magistrate’s task is (i) to consider the case on the evidence adduced before him without speculating as to matters not in evidence and (ii) to ask himself if he felt sure that the prosecution had proved beyond reasonable doubt every element of the offence charged.  That is the approach which the Magistrate followed.  On that approach, he was entitled to find that the prosecution had proved beyond reasonable doubt the absence of any lawful or proper basis for the 1^st Defendant to withdraw the money concerned in each charge.  The Magistrate did not proceed contrary to any of the cases cited or any other case.  Ground 3 for the 1^st  Defendant fails.

36.  Ground 4 for the 1^st Defendant is directed to what the 2^nd Defendant said under caution about the 1^st Defendant’s occupation and activities.  It reads:

“ The convictions are unsafe and unsatisfactory because the learned Magistrate failed to expressly exclude from his consideration the assertions in the admissions under caution of D2 in relation to the occupation and activities of D1 which information was potentially highly prejudicial to the position of D1 particularly upon the premise that the learned Magistrate found that D1 and D2 were acting in the course of a joint enterprise in making the withdrawals alleged against them.”

37.  It is elementary that nothing said by the 2^nd Defendant out of court is evidence against the 1^st Defendant.  Just because a Magistrate did not state the obvious, it does not mean that he was unaware or forgetful of it.  Ground 4 for the 1^st Defendant fails.

38.  Ground 5 for the 1^st Defendant consists of an assertion that “[t]he convictions were unsafe and unsatisfactory.”

39.  I find no proper basis on which to say that any of the 1^st Defendant’s convictions are unsafe or unsatisfactory.  Ground 5 for the 1^st Defendant fails.

40.  Coming now to the 2^nd Defendant’s grounds of appeal, Ground 1 for her is a complaint that the Magistrate “erred in Law, in that he had failed to approach the 2nd Appellant’s case, and/or remind himself that he should have approached the 2nd Appellant’s case on the basis that what the defendant had said was true or maybe true.”  That is followed by the following particulars:

“ 1. Having identified the 2nd Appellant’s case at paragraph 22 (AB Page 38) the learned magistrate went on at paragraphs 23 to 27 (AB pages 38 to 39) to outline ‘some basic principles’ including the burden and standard of proof.

2. The 2nd Appellant’s case was contained in her VRI (exhibit P11) and at paragraph 29(i) (AB page 39) took ‘the whole of VRI … into account in deciding where the truth lies’.

3. After an application of the law as in R v Sharp [1988] 1 WLR 7 the learned trial magistrate at paragraph 37 (AB page 45) stated that, ‘… in deciding where the truth lied, I had grave doubt whether the 2nd Defendant had told the whole truth … I ruled, therefore, in so far as he[r] statements in the VRI were exculpatory in nature, I wholly rejected them.’

4. At paragraph 40 (AB Page 45) the learned magistrate stated that although he had rejected the 2nd Appellant’s out of court statements, he still had to decide whether the prosecution had proved its case against her beyond reasonable doubt. At paragraph 46 (AB Page 47) held that the prosecution had done so.

5. The learned magistrate had dealt with the 2nd Appellant’s explanations purely as to whether or not she was telling the truth. He had never considered, whether or not what she said may have been true. That being the case, the learned magistrate had failed to correctly apply the burden of proof, to that of beyond reasonable doubt. See for example Sze Kwan Lung & others v HKSAR (2004) 7 HKCFAR 475 and Law Chung Ki v HKSAR (2005) 8 HKCFAR 701.

6. There was no prosecution evidence that contradicted the 2nd Appellant’s exculpatory assertions. So even if the hypothetical jury does not positively believe the evidence for the defence, they cannot find an issue against the defendant contrary to that evidence if that evidence gives rise to a reasonable doubt about that issue: see Liberato & others v R (1985) 159 CLR 507, at 515—referred to in the two Court of Final Appeal above cases.

7. The application of the principle in Liberato has to be looked at against the learned magistrates finding for all eight charges: that ‘in the absence of any acceptable evidence to the contrary’ the appellants’ had the requisite mens rea:

at paragraph 59 (AB page 53) for charge 1

at paragraph 61 (AB page 55) for charge 2

at paragraph 65 (AB page 57) for charge 3

at paragraph 67 (AB page 59) for charge 4

at paragraph 69 (AB page 61) for charge 5

at paragraph 71 (AB page 63) for charge 7

at paragraph 73 (AB page 64) for charge 9

at paragraph 77 (AB page 67) for charge 6

8. The learned magistrate had failed to consider the explanations by the 2nd Appellant, who furthermore, had a clear record: see R v Aziz [1996] AC 41 at page 51-D.

9. The convictions of the eight charges are therefore unsafe and unsatisfactory.

41.  I have already quoted paragraphs 37 and 38 of the Magistrate’s Statement of Findings in which he said (i) that he wholly rejected the exculpatory parts of the 2^nd Defendant’s video-recorded interview because he had “grave doubts whether the 2^nd Defendant had told the whole truth” during that interview and (ii) that he “likewise” rejected the exculpatory things which the 2^nd Defendant had said upon arrest.  The exculpatory things which the 2^nd Defendant said ought not to have been rejected unless the Magistrate felt sure, on the whole of the evidence, that there was no truth in them.  On the Magistrate’s Statement of Findings as a whole, that may have been the basis on which the Magistrate actually proceeded.  There is, however, no getting away from the fact the Magistrate had said in terms that he rejected the exculpatory parts of the 2^nd Defendant’s video-recorded interview because he had “grave doubts” as to their truth and that he had “likewise” rejected the exculpatory things which she had said upon arrest.  That being so, I am, all things considered, unable to regard any of the 2^nd Defendant’s convictions as safe or satisfactory. 

42.  The 1^st Appellant’s appeal against conviction is dismissed.

43.  As for the 2^nd Defendant, her appeal against conviction is allowed so that all her convictions are quashed.