HKSAR v. MAK WAI HUNG

DCCC 1001/2017

[2018] HKDC 968

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 1001 OF 2017

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Reasons for Sentence

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1.   The defendant, Mr Mak, has pleaded guilty to a total of six charges of theft today.

2.   They are thefts that involve a breach of trust, because they were directly from his employer.  His employer was a Mr Chan Kwok-wai, who is the main shareholder of a company called the Kin Man Garment Factory, and the defendant had been employed by Kin Man as accounting officer since about 2006.

3.  There were six what were described as “victim companies”, of which Mr Chan, PW1, was a shareholder‑cum‑director of those companies, and the defendant, as accounting officer, was assigned to handle the accounting matters of those six victim companies and keep the chequebooks of their bank accounts.

4.   At some time in mid-September 2015, questions arose about certain donations that had supposed to have been cashed into the accounts of some of the companies, and account records were checked and an insufficient balance was found in one of the companies’ accounts.

5.   This led to the defendant being questioned.  The defendant admitted straight away he had forged signatures on the cheques of accounts of all six companies in order to transfer moneys to his own bank accounts, or to transfer moneys among those companies to conceal his embezzlements.  He said he had done that because he had lost money in gambling.  And accordingly, the case was then reported to police.

6.   The defendant has agreed the facts which set out in some detail, useful detail, how the amounts particularised in each of the six charges are arrived at.  For example, what we do know is there are a total of 56 unauthorised withdrawals from the six company accounts by way of forged cheques.

7.   In the 1st charge they come to a total of 1.395 million, of which 440,000 was an inter-company account to the fourth company.  In the 2nd charge, the total is 80,000.  In the 3rd charge, it is 60,000. In the 4th charge, it is 640,000.  In the 5th charge, it is 800,000, of which 600,000 were inter‑company transfers; and in the 6th charge it is 440,000, of which 240,000 would be an inter-company transfer.

8.   So the total amount in the six charges that has been stolen from the companies is 3.415 million, but given that some of those were inter-company transfers from which the defendant would not in fact have benefited, those transfers were there to conceal his embezzlement.

9.   The actual benefit to the defendant is 2.135 million.

10.   The defendant was arrested in December of 2015.  He admitted he had forged signatures on the cheques of the six victim companies to steal that $2 million for his own use.  He made some more detailed admissions of how he set about that.  It is not necessary to deal with that now.

11.   The time taken for these six offences was between April 2014 and October 2015, so it was a fraud committed over quite a substantial period of time.

12.   As far as the defendant’s particulars are concerned, he has a spent conviction which I shall ignore.  I shall treat him as a person of clear record.

13.   As I understand it, he is now 63 years old.  He has been married and has two children as a result of that marriage. The two children are now grown up, although I understand he still pays some support towards the wife.  He lives with his elder brother and sister.

14.   The defendant’s mitigation would appear to be that he has always been financially tight as a result of losing his job in the year 2000 and taking on loans to cover the expenses of himself and his children, and he took the rather foolish decision to attempt to get out of his financial strictures by gambling.  Of course, that did not help, and he went further into debt.  But in 2016 he took the more sensible step of making himself bankrupt, so now at this point he is bankrupt.

15.   Since his arrest he has taken steps to get rid of what he recognises is his own gambling addiction, and has received both counselling and support from a church, and there are letters to that effect.  He is well supported by his family, who are in court today.  I understand unfortunately his elder brother, with whom he lives, is suffering serious illness.  But the support from the family is still there.  They all ask that I approach this with leniency; and also, unusually, the victim, Mr -- PW1 here, has also written a letter of support for the defendant, asking that I approach this case with leniency for him.  Clearly, this is an out of character series of offences for the defendant, and he is well thought of by the people who know him, including his employer.

16.   Although the offence is out of character, it was committed over a substantial period of time.  It is a theft from an employer.  That is a serious matter, and aggravates the nature of the stealing.

17.   Taking a look at the overall picture, the charges are divided into six separate instances involving each of the companies, but perhaps one has to look at the overall criminality, and the overall criminality is it is a theft from the employer committed over more than one year, involving a benefit of slightly over $2 million to the defendant.

18.   In these cases such as this involving a breach of trust, there are in fact guidelines set down by the Court of Appeal as to the correct sentencing approach.

19.   Where the figure is over $3 million, then the starting point for sentence can range up to 5 years’ imprisonment.  Where the amount involved is between 1 to 3 million, then the operative guideline is an overall starting point for sentence of 3 to 4 years’ imprisonment.

20.   In this case, although the charge itself involves a figure of 3.415 million actually stolen, the benefit to the defendant in terms of what he got away with is 2.135 million, and I consider the lower figure is the appropriate one to take as the operative figure within the guideline.

21.   So the defendant’s overall criminality puts him in the guideline figure of between 1 to 3 million, which is a starting point for sentence, for a person of clear record after trial, in the region of 3 to 4 years’ imprisonment, and would seem to be directly in the middle of that operative guideline.

22.   Counsel approaches this on the basis that the guideline must be respected, but the court should consider looking at some of the other factors:  the defendant’s early admission, his indication of a plea of guilty from an early stage, his remorse, his recognition of the fact that his gambling compulsion has led to this offence, and he has taken steps to deal with that; and so the court can perhaps mitigate that overall figure.

23.   What I shall do is determine an overall figure and then deduct that having regard to the defendant’s plea of guilty, and then determine the correct figure for each individual charge, and then adjust the final figure by way of consecutive and concurrent sentences to arrive at what is, I believe, to be the correct overall figure.

24.   I consider the appropriate starting point for sentence for this defendant, having regard to all the mitigating factors and aggravating factors, is one of 39 months’ imprisonment.

25.   The defendant will be entitled to a deduction of one‑third, which is 13 months, which leads to an overall figure of 26 months’ imprisonment for this series of offences.

26.   I will achieve that as follows.  These will be the sentences on each charge after deduction for plea of guilty:

Charge 1, 24 months;

Charge 2, 8 months;

Charge 3, 8 months;

Charge 4, 14 months;

Charge 5, 14 months;

Charge 6, 12 months.

27.  I shall order that the sentences on Charges 2 to 6 be served concurrently to each other, but 2 months of those consecutively to Charge 1.

28.  That will give an overall total of 26 months’ imprisonment.