HKSAR v. WONG KEUNG, BRAND

DCCC1337/2009
DCCC129/2010
(Heard together)

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO.1337 OF 2009
CRIMINAL CASE NO.129 OF 2010
(Heard together)

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Reasons for Sentence

1.  There are 2 cases involving the same defendant.

DCCC 1337/2009

2.  In case number DCCC1337/2009, the defendant faces 1 charge of “Using false instruments”, contrary to s.73 of the Crimes Ordinance, Cap.200 and 1 charge of “Theft”, contrary to s.9 of the Theft Ordinance, Cap.210.

Charge 1

3.  It is alleged that the defendant  on or about 29^th December 2008 in Hong Kong, used 2 purchase orders which were and which the defendant knew or believed to be false with the intention of inducing a person to accept them as genuine.

Charge 2

4.  It is alleged that the defendant on or about the same day as in charge 1, in Hong Kong stole 1,312 bags and 2,223 T-shirts which belonged to a limited company.

Brief summary of Facts

5.  In relation to charge 1, the defendant created false purchase orders to enable the company, which he was the sole director, Goldtex to be granted a loan by the victim company.

6.  In relation to charge 2, the defendant became the sole agent of some goods. The goods were delivered to a warehouse and into the defendant’s possession. The defendant was to distribute the goods to retailers and then hold on to the proceeds. The defendant however chose to steal part of the goods.

DCCC 129/2010

7.  In this case, the defendant faces 3 charges of “Obtaining a pecuniary advantage by deception”, contrary to s.18(1) of the Theft Ordinance.

Charge 1

8.  It is alleged that the defendant between 2^nd January 2007 and 12^th November 2008 (or thereabout), in Hong Kong, falsely represented that 334 invoices were genuine invoices documenting genuine business transactions, dishonestly obtained for himself or Goldtex Development Limited a credit facility in the amount of $1.5 million from Allied Bank Corporation (Hong Kong) Limited.

Charge 2

9.  It is alleged that the defendant between 4^th August 2007 and 24^th August 2008, in Hong Kong, falsely represented that 145 invoices were genuine invoices documenting genuine business transactions, dishonestly obtained for himself or Goldtex Development Limited a credit facility in the amount of $2.028 million from Standard Chartered Bank (Hong Kong) Limited.

Charge 3

10.  It is alleged that the defendant between 4^th September 2007 and 3^rd October 2008, in Hong Kong, falsely represented that 21 invoices were genuine invoices documenting genuine business transactions, dishonestly obtained for himself or Goldtex Development Limited a credit facility in the amount of $1.5 million from Citic Ka Wah Bank Limited.

Brief summary of facts

11.  The defendant used false invoices and purchase orders to obtain loan facilities from the 3 banks named in the charges over various periods of time. He was unable to repay the loans and ended up owing the banks a total of some $4 million.

12.  The defendant pleaded guilty to all charges in both cases, admitted to their respective summary of facts and was duly convicted.

Previous Convictions

13.  The defendant was of clear record.

Mitigation

14.  The defendant is 41, married but without children. He came to Hong Kong with his parents when he was 5. The parents are now 67 and 70 years old. The defendant went back to live with his parents after this incident. The parents are living on public assistance and past savings.

15.  The defendant began working after finishing F.5. He had worked in both the tourist and garment industries. The defendant started Goldtex in 2000, with himself as the sole director and his wife as the other shareholder. I was informed about how the defendant had taken in the son of his wife’s sister as his own and did his best to maintain him and help their family out. This act of selflessness is particularly precious given the fact that the boy suffers from Down Syndrome.

16.  At the time of the offence periods, the company employed 6 staff and the monthly expenses was around $70,000, which included the payment of salary to staff, rent and various disbursements.

17.  Since its formation in 2000, the company had seen some ups and downs, but most of the time losing money. The situation was particularly bad in the year of SARS and when there was a financial meltdown. The only reason the defendant committed the offences in both cases was to keep the company afloat and not to maintain some extravagant live style with the improperly obtained money.

18.  Despite the difficulties the company was facing, the defendant never owed his staff any salary payments.

19.  In case 129/2010 involving the 3 banks as victims, it is a fact that the overdraft facilities in relation to Allied Bank and Standard Chartered Bank were first applied for and granted in 2002 and 2003 respectively. It was the need to meet the yearly review criteria that the defendant was forced to make the wrong decision and committed the present offences to get the bank to keep the lines open. In spite of the deception, the overdraft facility in relation to SCB kept shrinking and in the end only $0.6M was outstanding.

20.  In relation to the 1337/2009 case, the loan amount was $250,000 and the missing goods in the warehouse was worth about $90,000.

21.  The overall total, I am told by counsel, for both cases is around $4.4 million.

22.  It is submitted that given the fact that the defendant has 2 properties that are mortgaged to Allied Bank and Citic Ka Wa Bank, it is likely that in the end they will both be able to recover their losses in full by way of foreclosure.

23.  Mr. Cheung further submitted the case of R v Law Yui Wo, CACC 107/1994 to assist me. In that case, there were 3 charges of obtaining by deception and the amount involved was some $6 million. A starting point of 5 years’ imprisonment was adopted and that was not disturbed on appeal. The amount in our case involved a smaller amount and should therefore attract a lower sentence.

Sentence

24.  Having considered the circumstances of the case, the previous clear record of the defendant, in particular how the defendant had deceived so as to keep his company afloat and to pay salary to his staff and not to use the money to maintain a lavish life style, and having considered the various letters submitted in mitigation showing that the defendant has all along been a decent person, while at the same time not forgetting that quite a lot of money is involved in the cases and that the offences in the 2010 case took place over a long period of time, but reminding myself of the assistance that the defendant had given to the investigating authorities, I will deal with the sentences as follows:

1337/2009:

Charge 1

25.  3 years’ imprisonment as starting point, discounted to 2 years upon the defendant’s guilty plea.

Charge 2

26.  24 months’ imprisonment starting point, discounted to 16 months upon the defendant’s guilty plea.

129/2010

Charge 1, 2 and 3

27.  3 years’ imprisonment starting point in relation to each charge, discounted to that of 2 years’ imprisonment upon the defendant’s guilty pleas.

Totality

28.  Having considered the principle of totality, I will order that the sentence in charge 1 of 1337/2009 be served wholly concurrently with that of charge 2 in that case. Total sentence in relation to 1337/2009 is therefore 24 months.

29.  In relation to 129/2010, I will order the sentences to run wholly concurrently, the total sentence is therefore that of 2 years’ imprisonment.

30.  I will order that 1 year and 6 months of the sentence in 129/2010 to run consecutively to the 2 years sentence in 1337/2009, making the total sentences for the 2 cases that of 3 years and 6 months’ imprisonment.