HKSAR v. LAM WA LUEN

DCCC 742/2012

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 742 OF 2012

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Reasons for Sentence

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1. This is a mortgage fraud case. The defendant pleaded guilty before me to one count of using false instruments, 3 sets of bank statements of account, contrary to section 73 of the Crimes Ordinance.

2. The prosecution case was that in 2003, the defendant used false bank statements in his name to apply for a mortgage from a bank and successfully obtained a loan of $900,000. He had defaulted on the mortgage payments after the first two instalments, and consequently the bank obtained a re-possession order from the court and sold the property. The bank suffered a financial loss of about $73,000.

3. Soon after the commission of the offence, the defendant took flight to the Mainland where he was sentenced to 7 years’ imprisonment for having committed another offence of theft over there.  

4. It turned out that what the defendant did was part of a larger mortgage scam. The dishonest scheme was to cheat on the banks by using false instruments such as employment letters and bank statements in order to obtain mortgage loans.

5. The defendant falsely claimed that he worked for a transportation company as a sales manager making a monthly income of $52,000. The court was told that another fraudster in the present case, a Mr. Cheng, who acted as the confirmor in the mortgage transaction, was given a total of 18 months imprisonment after pleading guilty to 3 offences of using false instruments (DCCC 16/ 2011). Acting as a buyer for Mr. Cheng, the defence counsel submitted, the defendant only played a minor role as a foot soldier in the scheme.

6. The defendant, aged 42, has 3 previous convictions, two of which are burglary for which he was given probation; his latest conviction was a sexual one in 1991 and for that matter he was dealt with by way of a fine. As far as his convictions in Hong Kong were concerned, he was never sent to prison.

7. Defence counsel in mitigation asked the court to take into account, when sentencing, of the defendant’s recent release from prison in the Mainland for which he had served 5 years. ‘With the Chinese new year just around the corner,’ counsel said, ‘the defendant did not choose to fight the case but instead showed good sense in pleading guilty because he was truly remorseful for his past misdeeds and determined to turn over a new leaf.’

8. Counsel further said that the mastermind of such scheme was a Mr. Chan who employed a number of persons to perpetrate the scam and netted millions of dollars, but he too was convicted and given a term of 7 years imprisonment for various similar offences. The defendant was promised only several thousand as a reward but was never paid, counsel said.

9. This was clearly a well-executed scheme and must have been planned carefully in advance. Undoubtedly it was a group action for it required the participation of a number of people like the confirmor- Mr. Cheng. It was suggested by defence counsel that the role played by the defendant was comparatively minor, but I do not agree for the scheme could hardly reap any ill-gotten gains without the participation of people like the defendant. Put in a different way, the defendant’s role was an absolute essential to the success of the scheme.

10. It is said by the appellate court in Ho Ka Keung CACC 196/2007 that it is well established that commercial frauds will attract, other than in exceptional circumstances, an immediate custodial sentence, even for a first offender.

11. I am mindful of the fact that the defendant in the present case was not found guilty of fraud but of using false instruments, and that his accomplice, Mr. Cheng, was only sent to prison for 18 months apparently for similar criminal conduct, but the question always remains whether the sentence in any particular case is proper ?

12. In dealing with complaints of disparity of sentence, the court in Lin Siu Lun CACC 383/2008 said that “But, even if there was a disparity, it is well established that, where different sentences are passed upon different defendants for the same offence by different judges on different occasions, the relevant consideration is whether the sentence passed on the accused is proper.”

13. Taking into account everything put forward by defence (In fact, apart from his plea, there is no mitigation of substance), given the facts of the case, I take 2 years as starting point and reduce it to 16 months to reflect his plea and there being no room for further reduction, the defendant is therefore sentenced to 16 months imprisonment.