HKSAR v. ABAYOMI BAMIDELE FAYOMI

CACC 197/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

criminal APPEAL NO. 197 OF 2005

(ON APPEAL FROM DCCC NO. 1337 of 2004)

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J U D G M E N T

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Stuart-Moore, VP (giving the judgment of the Court):

1.  On 12 April 2005, the applicant, aged 47, was convicted on 3 charges of dealing with property known or believed to represent the proceeds of an indictable offence, contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap. 455, following a trial in the District Court before Judge Toh.  The applicant was sentenced on the same day to concurrent terms of 3 years and 3 months’ imprisonment on each charge against which he now seeks leave to appeal.

The facts

2.  The total sum in the 3 charges amounted to $1,243,261.78 which was transferred from the United States of America to the applicant’s bank account in Hong Kong.  The circumstances in which this happened were not the subject of any dispute at trial so that the evidence in relation to the 3 transfers of money to Hong Kong was agreed under sections 65B and 65C of the Criminal Procedure Ordinance, Cap. 221.  These transfers occurred between 18 February 2004 and 2 March 2004.

3.  Before the transfers of money took place, Mr Gary Tsang (the victim) received an email in the United States of America from someone purporting to be a barrister informing him that he was the beneficiary, to the extent of US$8 million, under the estate of a ‘Mr Hans Tsang’.  The victim was told to contact the Inter City Bank in Nigeria at the email address he was given.  There followed an exchange of about 90 emails.  One of them informed the victim that the money to which he was said to be entitled had been released by the Nigerian bank to the Euro Central Union Bank in Hong Kong.  Then, on 17 February 2004, the victim received a request for US$130,000 to be sent to an account in Hong Kong.  This was the current account of Global Investment Company which had been opened by the applicant on 21 November 2003.  He was the sole signatory on the account.  The victim was informed that this money was needed so that various documents could be issued before the $US8 million could be released into his own account.  The sum he was required to send was later increased to US$160,000 which was said to be required in order that insurance, anti-terrorist and drug clearance certificates could be issued.

4.  On 18 February 2004, the victim sent US$70,000 (HK$543,682.32 after the deduction of bank handling charges) which was deposited into the applicant’s account on the following day.  Similarly, on 19 February 2004 and 2 March 2004 the victim sent a further US$60,000 (HK$466,122.30) and US$30,000 (HK$233,457.16), respectively, to the applicant’s account.  These three sums of money were reflected in charges 1, 2 and 3 respectively.

5.  Meanwhile, on 21 February 2004, sums of HK$30,000 and HK$450,000 were withdrawn from the applicant’s account by a Madam Choi who shared an office with the applicant, using two cash cheques bearing consecutive numbers each signed by the applicant.  Two days later, Madam Choi withdrew a further HK$400,000 from the account on a cheque signed by the applicant which again was made out to ‘cash’.  Three more days passed before the applicant used a counter cheque to withdraw HK$109,000 from his account and, on the next day, 27 February 2004, a further HK$15,000 was withdrawn from the account and immediately deposited into the applicant’s personal savings account with the bank which at that time had a credit balance of just HK$30.  After the victim had sent the third tranche of money to the applicant’s account on 2 March 2004 which was credited on 3 March 2004, the applicant wasted little time in withdrawing HK$180,000 from his account by using a further cash cheque at the bank on 4 March 2004 and, a minute later, someone withdrew a further HK$50,000 from the account.  Further sums were withdrawn in cash from the account between 6 March 2004 and 19 March 2004 leaving a balance of just HK$31.78 and the sum left in the applicant’s savings account was reduced to only HK$562.21 as the result of several withdrawals made at automatic teller machines.

6.  The applicant was arrested at the bank on 15 September 2004.  He said nothing to the police at that stage but he chose to give an explanation 2 days later saying that he was running an import/export business and that the deposits arose from his business.  He was, however, unable to supply any documentary evidence to support his assertions because, according to him, the documents were in the Mainland.

7.  In the course of his evidence at trial, the applicant said that his normal monthly income was $15,000.

The application

8.  Two grounds of appeal were advanced on the applicant’s behalf by Mr Christopher Grounds.  In essence, these amounted to an assertion that the starting point of 3½ years’ imprisonment which the judge adopted was manifestly excessive and that some of the comments made by the judge in the course of sentencing disclosed “flaws in reasoning”.

9.  Dealing with the first of the complaints raised by Mr Grounds, he submitted that the case was “lacking in aggravating circumstances” when the present facts are compared to other cases of a similar kind.  Mr Grounds particularly relied on what was said in HKSAR v Xu Xia Li and Anor [2004] 4 HKC 16 where a number of previous decisions in similar cases heard by this court were reviewed.  It is unnecessary to repeat much of what appears in that judgment and, from the judge’s sentencing remarks in the present case, it is plain that she was well aware of the decision having cited the case and repeated, in effect, part of Woo VP’s judgment (at page 23) which states:

“18.   The prohibition of the offence is in order to strike at those who give assistance to criminals to dispose of or retain their ill-gotten gains as if they were derived from legitimate activities. Without the assistance of money launderers, it would be more difficult for criminals to clothe their illegal proceeds with the same respect as lawful gains and the chances of law enforcement detection of illegal activities that produce monetary benefits would be enhanced. Money laundering is therefore treated as a serious offence. If money laundering activities were allowed to be carried out in Hong Kong with impunity or treated lightly with minor penalties it would mar Hong Kong’s reputation as a world-class financial and banking centre. We consider that the sentence of three years’ imprisonment after trial imposed by the judge cannot be criticised for being too harsh in the circumstances or against principle or in any way manifestly excessive.”

There, the court was dealing with two appellants charged with conspiracy to launder $11 million and $3 million respectively, both of whom received the same sentence.

10.  It is not without interest in the present context that in one of the cases reviewed by the court in Xu Xia Li, $1.5 million was involved.  The summary of that case (at page 21) reads:

“(3)    In HKSAR v Mak Shing, (CACC 322/2001, 18 September 2002, unreported), the applicant was convicted of three counts of money laundering and was sentenced to four years’ imprisonment on each count, concurrent. He had been approached by an acquaintance to launder proceeds of smuggling cigarettes in China. The amounts involved totalled $1.5 m, but they were in fact proceeds of thefts which had occurred on the Mainland.”

An examination of Mak Shing’s case reveals that a starting point of 5 years had been adopted by the sentencing judge and that a discount of a year had been given “to reflect the fact that all the basic facts had been agreed”.  The judge had gone on to say that the offence was prevalent without giving an indication as to the basis of his conclusion.  The court also considered that the appellant’s personal circumstances were such that weight could be attached to them and that the judge appeared not to have taken this factor into account at all.  The court’s conclusion in that case, which does not emerge in its entirety from the summary provided in Xu Xia Li, was as follows:

“	26.	Having said all of this we fully accept that this was a serious case and the Judge was justified in imposing a sentence which would discourage others from doing the same thing.
	27.	It also has to be borne in mind that there was an international element to the offences and that Hong Kong has to take a very serious view of such matters if its international reputation is not to be sullied.
	28.	Bearing all of this in mind we have come to the conclusion that the starting point adopted by the Judge was manifestly excessive.
	29.	In our view a starting point of four years’ imprisonment would have been sufficient to reflect the seriousness of these offences. We are also of the view that the applicant was entitled to a significant discount by virtue of the fact that his defence was confined to legal arguments as to whether he could avail himself of the saving provision in section 25. A discount of one year for this is appropriate.”

11.  Returning to Xu Xia Li’s case, in a passage relied on by Mr Grounds in reference to the cases (including HKSAR v Mak Shing) which Woo VP had just reviewed, it is stated (at page 22) that in each of those cases no particular significance had been attached to the kind of criminal activity which had produced the proceeds.  Woo VP then said:

“…By the nature of the offence itself, in our judgment, the nature of the indictable offence from which the money was derived should be of no particular significance in sentencing, save that if the defendant knew that the money was derived from very serious crimes, it would be an aggravating feature to be taken into account in sentencing.”

The contention of the appellants’ counsel in that case that the “mental culpability of a money launderer based only on reasonable belief of the source of the money should be less serious than that based on actual knowledge” was rejected.  The respondent’s counter-argument which was accepted was that “if a money launderer is clever enough not to seek to be apprised of the source of the money to be laundered, there should not be any reasonable justification for him to be punished more leniently than one who had asked and got to know”.

12.  In the present case the judge convicted the applicant on the basis that he believed the monies he laundered were the proceeds of an indictable offence without actual knowledge of the deception which had initiated the victim’s loss.  Had this case been concerned with the proceeds of a violent robbery and murder, to use one of the examples used by Mr Grounds, it would have been an aggravating factor only if it could be proved that the offender had knowingly laundered the stolen money from that crime.  However, by the use of such an analogy, it is difficult to distinguish an offence of laundering the proceeds of a crime from the separate offence of handling stolen goods.  In the instant case, there were no particular factors which aggravated the offence for the purposes of sentence although there is an obvious inference to be drawn that he was motivated to act in the way he did for personal gain.  In short, Mr Grounds complained that the applicant had been sentenced as a “major player behind the fraud”.

13.  There are no guidelines for this kind of offence and it is difficult to see that there could be because of the infinite variety of circumstances that may exist which lead to offences of this kind.  We are, however, satisfied that a sentence of 3 years and 3 months, given the circumstances of this case, cannot be described as manifestly excessive.

14.  The second ground of complaint raised the same point with which the court in HKSAR v Mak Shing (above) was also concerned.  It was submitted that the judge’s sentencing remarks involved some degree of speculation in that the judge commented when passing sentence:

“… This type of offence is also on the rise and having considered the circumstances of this case and the fact that this type of case is on the rise, a deterrent sentence should be considered to deter others …” (Appeal bundle p. 21)

15.  Mr Grounds made the point that if this offence was “on the rise” the prosecution could have applied, under section 27 of the Organized and Serious Crimes Ordinance, for an enhanced sentence on the ground of ‘prevalence’.  We agree that there is some justification for the point which is made and no doubt, without the necessary statistics, it was unwise of the judge to have ventured the suggestion she made.  Mr Hayson Tse, for the respondent, in a full and helpful written submission, very properly provided us with the actual statistics for offences of this kind and readily accepted that these do not support the view that this is a prevalent offence which effectively amounts to a re-statement of what had been said in Mak Shing’s case on 18 September 2002.  That being said, we have already indicated that we do not consider that a sentence of 3 years and 3 months on the present facts was manifestly excessive and to this extent the judge’s comments appear to have made little difference.

16.  In fact, the judge reduced her original starting point of 3½ years by 3 months to take into account the applicant’s clear record and his agreement to all the evidence called by the prosecution.  As to both aspects of this reduction in sentence, the judge made reference to the approach of this court in HKSAR v Xu Xia Li and Anor (above) where a 3-month reduction in sentence was made for precisely these reasons.  However, although this may have been the approach taken in that case, it provides in itself no hard and fast authority that a defendant without previous convictions should necessarily receive a discount in cases where serious criminal conduct is involved.  This will be a matter for the sensible exercise of discretion by the sentencing judge.  The same considerations apply with regard to the acceptance by the defence of large portions of the prosecution’s case or, as here, the whole of their case.  This will often amount to no more than a sensible tactical decision on the part of counsel for the defence who is seeking to put a different interpretation on those facts from the way in which the prosecution has presented its case.

17.  In the present case, there was no challenge whatever to the evidence that the victim’s money had found its way into the applicant’s recently opened account and the defence sought merely to avoid a finding of guilt by what in the end proved to be the false explanations given by the applicant for what had occurred.

18.  The end result in terms of sentence was not, in our opinion, open to justified criticism.

Conclusion

19.  Accordingly, the application is dismissed.