HKSAR v. CHOW LAI SZE, ALICE AND ANOTHER

DCCC1233/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 1233 OF 2008

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Reasons for Sentence

1.  Defendants, you have pleaded guilty to the charges before this court.  You are siblings - 1st defendant, you are the sister, and the 2nd defendant, the brother to each other.  1st defendant, you have pleaded guilty to 31 charges before this court.

2.  The first 30 charges are charges of theft of sums of money on various dates between 13 November 2006 and 2 June 2008 from a company known as Shinsei Printing Hong Kong Limited.

3.  The 31st charge, which is against both defendants, is a charge of conspiracy to deal with property known or believed to represent the proceeds of an indictable offence, again, between the same dates, that is, 13 November 2006 and 2 June 2008, that you conspired together to deal with property knowing or having reasonable grounds to believe that the property, that is, the cash, of $6,050,104.95 deposited into various bank accounts were in whole or in part directly or indirectly represented any person’s proceeds of an indictable offence.  That total of $6 million odd represents the sums of which the 1st defendant was stealing from the Shinsei Company and then depositing that money into the 2nd defendant’s bank accounts.

4.  The 1st defendant was employed by the Shinsei Company in 1999.  She was a clerk at the company.  Her duties included making payments to clients and was the person responsible for preparing and submitting the application for remittance forms to the bank.

5.  In June 2008, the company received a complaint from one of their clients that the company had failed to settle an outstanding payment in the sum of US$1 million.  The manager of the company, of Shinsei, asked the 1st defendant to make inquiries.  The 1st defendant told him that that company had confirmed the outstanding payment amount was US$700,000 odd and a representative had signed the document confirming the same.

6.  On 11 September 2008, the persons who worked at Shinsei met the representatives of that company, and that person in charge said that they had never discussed with the 1st defendant about the outstanding payment.  Later, on 25 September 2008, a colleague of the 1st defendant handed to a representative of the victim company a confession letter written by the 1st defendant.  In that letter, the 1st defendant admitted that she had embezzled US$389,090.92.  In that letter, she stated that she was willing to make full restitution by instalments over 26 years.

7.  The following day, the 1st defendant confessed that she had stolen from the company and also on 2 October 2008 confessed before a solicitor instructed by the victim company.  After inquiries were conducted with the bank, it was discovered that the 1st defendant had stolen HK$6 million by way of remittances from the company’s bank accounts into bank accounts of her brother, the (2nd) defendant.

8.  Under caution, the 1^st defendant admitted that she had stolen since early 2007, that she had submitted forged applications for remittance forms to the bank, instructing them to transfer funds from the account into the bank account of her brother, the 2nd defendant.  She admitted she had transferred about $100,000 to HK$200,000 on each occasion and after each transfer she asked the 2nd defendant to withdraw $20,000 on a daily basis as that was the upper limit of ATM withdrawal.  She said she used the proceeds to settle credit card payments.  She also spent the money with the 2nd defendant.  She had given $30,000 to $40,000 to the 2nd defendant to purchase a car, and she had spent $194,000 to purchase a flat at Fu Shin Estate.

9.  As for the 2nd defendant, he admitted the 1st defendant started to use his bank account since July 2006 and the 1st defendant had transferred sums ranging from HK$50,000 to HK$300,000 into his bank account two to three times a month.  The total amount transferred was about HK$3 million to $4 million.  After each transfer, the 1st defendant asked him to withdraw $20,000 on a daily basis.  He spent money on purchasing a car and he also used the money to buy a flat in Fu Shin Estate.  He believed that the 1st defendant had stolen the money from others.

10.  After a police investigation, it was found that the 1st defendant had rented a flat in Tai Po Centre.  The police conducted a search at this flat in Tai Po Centre, the flat at Fu Shin Estate and inside the car that was purchased.  Many exhibits were seized, and it is items 7 to 94, 96 to 109 and 111 to 119.  In the application for disposal of exhibits, the defendants admitted that those items were bought with the use of the money stolen from the company.  Those items were ranging from a computer, a printer and many designer and luxury brands of clothes, handbags, jewellery and shoes.

11.  The defendants had been represented by two different counsel before me in mitigation.  On the last occasion it was Miss Linda Wong, and on this occasion, it is Mr Joseph Lee, both instructed by the same solicitors’ firm for the 1st and 2nd defendants.  I have taken into account all they have had to say on behalf of the defendants.

12.  On the last occasion, I adjourned until today as the prosecution had originally asked for compensation orders to be made.  And having directed the defendants to file an affidavit of means, the prosecution are now no longer applying for a compensation order to be made in view of their financial circumstances.  I had also asked whether a value could be placed on the exhibits which were seized, and no value can be placed on exhibits which were seized.

13.  As I mentioned, the two defendants are of clear record.  The 1st defendant is 32 years of age.  She has received education up to Form 5 in secondary level in Hong Kong and is currently single.  She had worked for the Shinsei Printing Hong Kong Limited company, the victim company, for about nine years before the discovery of these offences.  In September 2008, she was earning $13,000 odd per month.  She contributed 4,000 of her monthly income to her family every month.

14.  In August 2006, the 1st defendant’s boyfriend, whom she had had a relationship since 1999, committed suicide after battling a drug abuse problem.  In the period after his death, the boyfriend’s mother had been constantly requesting the 1st defendant to pay her compensation for his death, and the defendant was thus in a distressed state.  As a result, since November 2006, the 1st defendant commenced stealing money from the company until she confessed in September 2008.

15.  The 2nd defendant is now 36 years of age, also single, also received education up to Form 5.  He was a construction site worker earning $17,000 per month.  He also contributed four to five thousand dollars of his monthly income to his family.  During his spare time, he had been studying for other various courses in respect of the construction business.

16.  Both defendants lived with their elderly parents in Fu Shin Estate in Tai Po.  The father is 70 years old; the mother is 60; and both are retired.  They have a brother who has moved out from the family and is married.  The Fu Shin Estate flat is in the joint names of the father and the 2nd defendant.

17.  I have received numerous letters of mitigation from both the 1st and 2nd defendants, the parents, the brother and colleagues of the defendants.  I have taken those into account.  I have also taken into account a letter written by the District Counsellor of Tai Po asking for leniency.

18.  As Mr Lee rightly points out in respect of the 1st defendant, the offence is one of a breach of trust.  The defendant had been working in a position of trust with the Shinsei Company, dealing with money, and had breached the trust by stealing, in this case, vast sums of money.  The total amount stolen was just over $6 million over a very short period of time of one year and seven months.

19.  It is of note that both defendants make admissions and the amount of money stolen.  The 1st defendant admitted to the company, that she stole some US$389,000 odd which is approximately $3 million.  And D2 in his cautioned statement said three to four million dollars.  The actual amount, of course, being $6 million.  Money was coming fast and easy to the two of them.  They did not even know the amount they had actually stolen was such a vast amount of money.  I accept, of course, they have pleaded guilty now to $6 million but, at the time of their first admission, they only said half that amount.

20.  It is said on behalf of the 1st defendant that she committed this offence as a result of being pressurised by the ex-boyfriend’s mother for compensation for the boyfriend’s death.  I have not heard of any compensation being made to the boyfriend’s mother.  In any event, I do not accept that that could be a possible reason why she has come to steal this money.

21.  It is clear to me that the defendant’s theft of the money was outright greed and over-indulgence for a comfortable, luxurious lifestyle.  It is evident from the exhibits seized that the 1st defendant had expensive and luxurious spending habits.  She had a taste for items of clothing, bags, shoes and jewellery from the most expensive designer houses such as Chanel, LV and Cartier.

22.  What was bought was purchased in vast quantities.  It is submitted on behalf of the defendant that the value she thinks that the seized exhibits were at the time she purchased these goods was some $3 million.  There are no receipts for these goods that are purchased, and there is nothing to support her submission that these goods were purchased at some $3 million.  I, therefore, cannot accept that these goods were purchased for $3 million.

23.  It is not exactly clear how the defendants spent the stolen sums.  Certainly, some were on luxury goods, designer goods.  As admitted, the defendants had purchased a car, but that was only in the amount of about $30,000 to $40,000 and a flat in which they are all now residing at Fu Shin Estate of $194,000 odd.  There is a contradiction, I see, in both defendants as to how the funds were provided for the purchase of this flat.

24.  The 1st defendant says that money, all of the stolen money, was used to purchase this flat.  The 2nd defendant says part of it was used for the flat but part of it was the father’s money.  I query this matter.  The father has been unemployed, been supported by the children and even now, he says, as a result of no support, he has to rely on public assistance.  In any event, that flat is not subject to any compensation order as is clear from the law that the prosecution cannot apply for that flat to be sold.  Despite a serious offer, I believe, on the last occasion to reimburse the victim, nothing has been done about this flat.

25.  As for the 2nd defendant, he says that he did not know where the money came from but suspected that the 1st defendant was stealing.  Now, as Mr Lee rightly says, as between the two defendants, there is a difference when I come to sentencing them both as the 1st defendant’s was one of breach of trust.  Breach of trust guidelines were clearly laid down in the case of HKSAR v Cheung Mee Kiu CACC99/2006 and as amended slightly in HKSAR v Ng Kwok Wing [2008] 4 HKLRD 1018.

26.  As for the 1st defendant, I look at the total amount you have stolen, which is $6 million odd.  And according to Ng Kwok Wing, that falls in the bracket of $3 million to $15 million, which is five to ten years’ imprisonment after trial.  So, in taking the totality of the sentence, I take a six-year starting point.  However, for all charges 1-30 in the total sum, I give you full credit for your plea of guilty and reduce that term to one of four years’ imprisonment.  I will give pass the individual sentences in a moment.

27.  As for Charge 31, you are both sentenced together jointly.  The same amount is involved, $6 million odd.  This is a money laundering charge.  And for this charge, I shall take a four-year starting point after trial and reduce that term to one to two years eight months, giving you full credit both for your pleas of guilty.  For D2, I shall give you a further reduction of two months and reduce that term to two years six months because of the exhibits which have been recovered.  So you are sentenced to two years six months.  And for D1, I shall also give you two months’ reduction and the total sentence on you will be three years and ten months’ imprisonment.

28.  For D1, your sentences are on all charges will be a starting point of two years’ imprisonment; that is Charge 1 to 30.  And giving you full credit for your plea of guilty, that shall be reduced to one of 16 months’ imprisonment and, that is, Charges 1, 14 and 28 are to run consecutive to each other.  The remainder are to run concurrent.  So, 1st defendant, you are sentenced to three years ten months, 2nd defendant, two years six months.

(Discussion re disposal of exhibits)

Court adjourns - 1.05 pm

Court resumes - 2.39 pm

Both defendants present.  Appearances as before.

29.  Can I just say that this morning, I said consecutive sentence of 16 months on Charges 1, 14 and 28 but it should be consecutives of 1, 14 and 28 but on Charge 28, only 14 months of that to run consecutive and the remaining to be concurrent.  So that would make a total of three years ten months; that is for the 16, 16 and 14.  And, of course, all the others are concurrent as well, Charge 31 also concurrent.