HKSAR v. KA LONG HEI AND ANOTHER

DCCC 562/2023

[2025] HKDC 961

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 562 OF 2023

----------------------------------------

----------------------------------------

--------------------------------------------------

REASONS FOR SENTENCE

--------------------------------------------------

1.  The first defendant was convicted of Charges 2 and 4 and the second defendant was convicted of Charge 4 after trial.

2.  Prosecution sought an enhancement of sentence under section 27 of the Organized and Serious Crimes Ordinance, Cap. 455 and submitted the witness statement of Detective Chief Inspector Cheng Sze-wai on the prevalence of the offence and the nature and extent of any harm caused to the community by occurrences of the specified offence.

The First Defendant

3.  The first defendant was convicted of 2 counts of dealing with property known or believed to represent proceeds of an indictable offence.  Charge 2 involved an amount of HKD50,000 and Charge 4 an amount of HKD10,000.

4.  In both charges, the first defendant was found to have collected the involved amounts from victims of telephone deception scams.

Previous Convictions

5.  The first defendant is of clear record.

Training Centre Report

6.  The Court called for a Training Centre Report prior to sentence.  The first defendant was found to be fit for detention in a Training Centre.

7.  The contents of the report revealed that the first defendant was of 19 years and 1 month of age at the time of the report.  His father is a businessman in clothing industry, his mother is a housewife and his brother is a delivery worker.  The first defendant lives with his family members at a rented private apartment in Kowloon Tong.  The first defendant completed form 3 education in 2022.  He enrolled in a diploma course in vocational education at the Youth College (Kwai Chung), but he did not complete the course.

8.  From January 2023, the first defendant remained idle until February 2024 when he worked as a part-time decoration worker, earning about HKD1,000 per day.  He quit his job in May 2024.  From October 2024, he worked as a part-time bartender earning about HKD1,000 per day.  He kept his employment until his current remand.

9.  According to the report, the first defendant was brought up in a local middle-class family.  He received family supervision and parental care. However, he was led astray after entering secondary school.  He befriended dubious peers in August 2020 and out of greed and the desire to earn easy money, he breached the law without consideration to the serious consequences.  The first defendant was arrested for the present offences in 2022.  After he was granted bail, he became a member of triad society in April 2023.  He kept continued to abuse dangerous drugs until April 2024.

Mitigation

10.  Counsel for the first defendant submitted that the first defendant was 16 years old at the time of the offences.  He received an education at form 3 level.  He had worked as a part-time bar tender earning approximately HKD1,000 per day.

11.  The first defendant expressed his remorse for causing his mother much distress.  He indicated that his mother received regular medical treatment in China, his girlfriend suffered a miscarriage because of stress and his grandmother suffered from failing health after a recent stroke.

12.  Counsel for the first defendant cited the Reasons for Sentence of 香港特別行政區訴余建智[2024] HKDC 1139 and submitted that the 19-year-old defendant pleaded guilty to 3 counts of offence that involved telephone deception.  The amounts involved were HKD40,700, HKD158,000 and HKD100,000.  The defendant had a clear record and was sentenced to detention in a Training Centre by the Court.

13.  Counsel for the first defendant also cited authorities including HKSAR v Lam Ka Sin [2021] 2 HKLRD 32, HKSAR v Cen Huakuo [2015] 2 HKLRD 951, HKSAR v Tang Tsz Fei [2024] HKDC 1962, HKSAR v Fong Chi Yam [2020] 2 HKLRD 700 and HKSAR v Lam Yuk and Another [2025] HKDC 543.  The Court has considered these authorities in detail.

14.  Mitigation letters written by the first defendant’s parents, his auntie and the leader of Shatin Youth Outreaching Social Work Team were submitted to the Court for consideration.  The first defendant’s auntie described him as polite, filial and was loving towards people around him.  His parents stated that he was kind and helpful.   He took care of his grandmother after her stroke.  His father indicated that the first defendant committed the present offences when he was 16 years-old and was immature at the time of the offences.

15.  Ms. Ng from the Shatin Youth Outreaching Social Work Team described the first defendant as kind but easily influenced by friends.  The first defendant has communicated his remorse for his actions to her and she believed he has reflected on the seriousness of the offences.  Ms. Ng confirmed that the first defendant has participated in social work at the centre.

The Second Defendant

Previous Convictions

16.  The second defendant was convicted of one count of common assault and one count of theft in June 2020.  He was sentenced to a Probation Order of 18 months. In October 2020, he was convicted of 7 charges and was sentenced to a Detention Centre Order.

Training Centre Report

17.  The Court called for a Training Centre Report prior to sentence.  The second defendant was found to be fit for detention in a Training Centre.

18.  The report indicated that the second defendant was 18 years and 9 months of age at the time of the interview.  He was born in Hong Kong.  His biological parents divorced in 2008.  He was living with his mother and stepfather at the time of the present offence.

19.  The second defendant’s academic performance was found to be unsatisfactory in primary school.  He was subsequently diagnosed with Attention Deficit Hyperactive Disorder and Dyslexia in 2010.  Delinquent behavior was detected after his association with triad-related schoolmates.  In September 2019, he became a member of the Sun Yee On Triad Society.  Soon after, he committed his first offence of Common Assault and the offence of Theft.  He was arranged to continue his studies at a boarding school after his release on bail.  However, when he returned home after the COVID outbreak, he committed 7 offences in 2020, and was arrested by the police.  He was detained in the Tuen Mun Children and Juvenile Home and was subsequently sentenced to detention in the Detention Centre.

20.  After his discharge from the Detention Centre in March 2021, he completed Form 3 education.  He attended vocational training at the Youth College (Yeo Chei Man) but did not complete the diploma course.  He began working as a delivery worker in April 2022.  He met the first defendant in mid-2022. He was arrested for the present offence in October 2022.

21.  The second defendant denied the commission of the convicted offence and maintained his innocence.  He alleged that it was the first defendant who instructed him to collect money from the victim.  He had no knowledge that the money collected were obtained by deception and that he did not receive any monetary reward.

Mitigation

22.  In mitigation, counsel for the second defendant submitted that he was just over 16 years of age at the time of the offence.  His mother, a housewife and his stepfather, a construction site manager were concerned and remained supportive of their son.

23.  The second defendant studied at the vocational training centre for a Diploma of Physical Education.  He did not complete the diploma due to his attention deficit and oppositional defiant disorder.  He worked as a part-time delivery worker earning approximately HKD600 per day and a warehouse assistant earning HKD900 per day.

24.  The second defendant submitted mitigation letters written by his parents, his mother’s friends and his former employer.

25.  His parents stated that the second defendant suffered from his biological father’s abandonment.  His attention deficit disorder affected his learning and communication skills.  He was influenced by his friend when he committed the present offence.  They claimed that the second defendant has “made genuine reflection” and was working hard to improve himself since his arrest.

26.  His mother’s friend described the second defendant as an impulsive young man.  He became humbler and caring after the present offence.  He worked hard to earn a living and was willing to help others.

27.  His former employers at Kin Bon (HK) Company Limited and Hang Feng Logistics Development Limited confirmed the second defendant’s excellent performance at work.  They considered him a responsible worker.  Mr. Liu of Hang Feng Logistics indicated that he was willing to re-employ the second defendant.

28.  The defence submitted that the second defendant frankly admitted his previous convictions and that he was on bail for another outstanding case. However, he maintained his innocence and indicated that he would defend his case.  It was further submitted that although the second defendant has a number of convictions from June to October 2020, the contents of the mitigation letters reflected his marked improvement since his arrest.

29.  For the present offence, defence submitted that Charge 4 involved one transaction of HKD10,000.  Although there were unknown perpetrators involved, there was no evidence that the offence was committed with sophisticated planning or involved organized syndicate, international or cross border elements.  The second defendant was found to be a mere money collector.  There was no evidence that the second defendant knew he was going to collect money obtained from a phone scam.  He had no knowledge at all or “any sketchy knowledge” of the predicate offence.

30.  Defence for the second defendant cited authorities including HKSAR v Hung Yung Chun [2011] 2 HKLRD 174, HKSAR v Boma [2012] 2 HKLRD 33 and HKSAR v Cen Huakuo [2015] 2 HKLRD 951.  The Court has considered these authorities in detail.

Sentencing Consideration

31.  Dealing with proceeds of an indictable offence is a serious offence that carries a maximum punishment of HKD5,000,000 fine and 14 years’ imprisonment.

32.  In HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545, the Court of Appeal held that there are no sentencing guidelines for the offence of dealing with the proceeds from an indictable offence because the facts vary from case to case. The Court indicated factors to be takin into account when determining sentence:

(1) It is the amount of money involved that is a major consideration and not the amount of benefit received by a defendant in the transaction.

(2) The culpability of the offence lies in the assistance, support and encouragement offered to the commission of an indictable offence. A defendant’s level of participation and the number of occasions on which he is involved in the “money laundering “activities are relevant factors to be considered.

(3) The offence of dealing with the proceeds from an indictable offence does not necessarily have any direct correlation with the indictable offence in question. However, if the relevant indictable offence can be identified, the court may take into account the sentence imposed on the indictable offence per se when determining the sentence of the dealing offence.

(4) If the case has an international element involving activities carried out across different regions, the court may impose a more severe sentence. This is to protect Hong Kong’s reputation as an international finance and banking hub from being tarnished.

(5) The length of time the offence lasted.

33.  In Hsu Yu Yi it was indicated that if the “black money” involved was between HKD1,000,000 to HKD2,000,000, the starting point should be in the order of 3 years’ imprisonment.

34.  Defence cited the case of Hung Yung Chun in which the Court of Appeal, in determining the sentence for the offence of “conspiracy to defraud”, stated that the sentence should generally be 4 years’ imprisonment with 1/3 enhancement.

35.  Boma laid down the factors that the Court should consider in determining the appropriate sentence, the factors include: -

(a) the amount of money;

(b) the nature of predicate offence;

(c) the state of offender’s knowledge;

(d) where the operation involved an international dimension;

(e) the sophistication of the offence, including the degree of planning;

(f) where the offence was committed by or on behalf of an organized criminal syndicate;

(g) whether there was one transaction or many and the length of time over which the offence was committed;

(h) whether the offender continued to launder funds after he had discovered the nature of the funds were proceeds of an offence or a serious offence was involved; and

(i) the role of the offender and the acts performed by him.

36.  In SJ v Ngai Fung Sin Apple [2013] 5 HKLRD 104, the Court held that the sentences passed in money laundering cases are primarily to reflect the amount of the “illicit/black money” involved.  Neither the fact that the “illicit/black money” was actually not derived from an indictable offence nor the defendant’s ignorance of the actual source of the “illicit/black money” is necessarily a valid mitigating factor.

Young Offenders

37.  The Court is aware of the fact that the first defendant and the second defendant are considered as young offenders.  As such, the Court should consider passing non-custodial sentence unless it is not considered appropriate.  I have considered the present circumstances including the physical and mental health of the defendants. 

38.  The Court considered that the deterrent factor is the foremost issue that a sentencing judge should bear in mind in dealing with money laundering offences.

Sentence

The First Defendant

39.  The Court has considered the authorities submitted by the counsel for the first defendant.  In particular, the circumstances of case of 余建智 are similar to that of the present case, including the fact that the defendant in 余建智 is of the same age and has a clear record.  I have considered the background of the first defendant and the circumstances leading to his commission of Charges 2 and 4.  I do not consider the influence by a friend is a valid mitigation factor. 

40.  However, having considered all the circumstances of the case, Charge 2 involved an amount of HKD50,000 and Charge 4 an amount of HKD10,000.  These amounts are not considered as large amounts in money laundering cases.  I have considered the contents of the Training Centre Report, he is deemed to be suitable and fit to be detained in a Training Centre.  The first defendant was only 16 years old at the time of the offences.  I consider him suitable to be sentenced to detention in a Training Centre for Charges 2 and 4.

The Second Defendant

41.  Defence for the second defendant submitted that the seriousness of the second defendant’s case was less than that of Cen Huakuo case.  The circumstances in Cen Huakuo involved sketchy knowledge and cross border element.

42.  Counsel for the second defendant also referred the Court to the authority of HKSAR v Fong Chi Yam [2020] 2 HKLRD 700, in which a 1-year starting point was appropriate for a sum of $37,100, which is considered as a relatively small sum.  The applicant in Fong Chi Yam had no knowledge of and had not participated in phone deception.

43.  Charge 4 involved an amount of HKD10,000 and one transaction.  I accept that the sum involved was not substantial, and the offence was not committed over a substantial period.  There is no evidence that Charge 4 involved an international dimension or committed by or on behalf of an organized criminal syndicate.  The role of the second defendant was to collect money from the victim.  I agree that the second defendant was not the mastermind of the operation.  However, he did act in concert with the first defendant and other unknown persons.

44.  It is submitted by the second defendant that his role was a mere money collector.  However, without his participation the mastermind would not be able to conduct his operation, collect money from the victims and enjoy the benefit from the operation.

45.  I have considered the contents of the Training Centre Report.  The second defendant maintained his innocent and showed no remorse towards his actions.  The second defendant had 9 previous convictions.  Although the convictions did not involve the same offence of the present case, the Courts have given the second defendant ample opportunity to rehabilitate, no doubt taking into account of his young age at the time of the convictions.  He has been sentenced to serve a Probation Order and to detention in a Detention Centre.  However, he continued to commit further offences, which clearly indicated a lack of appreciation for the opportunity to rehabilitate.

46.  He committed the present offence whilst on bail which constituted an aggravating factor.  A deterrent sentence is a factor in dealing with money laundering cases, and in dealing with circumstances of the case where the second defendant acted in concert with others, and in the clear failure of rehabilitative sentence to deter him from re-offending.  I consider an imprisonment term to be an appropriate sentence option for the second defendant.

47.  Having considered the previous convictions of the second defendant, the circumstances of the present case including his role and participation, I adopt a starting point of 13 months’ imprisonment.  He acted in concert with others which is an aggravating factor, the Court enhances the sentence for 2 months.  He committed the present offence whilst on bail which is also an aggravating factor, the Court enhances the sentence for 2 months.  The second defendant was convicted after trial, as such he is not entitled to any reduction of sentence.  The second defendant is sentenced to a total of 17 months’ imprisonment.

48.  The first defendant and the second defendant object to the prosecution’s application for enhancement of sentence.  I have considered the grounds of objection submitted by counsel for the first defendant and the second defendant, and the case of Fong Chi Yam submitted by the prosecution.   I find that there is no evidence to prove that the first or the second defendant had knowledge of the predicate offence.  Although they were promised rewards just for collecting money, which should be sufficient to raise suspicion.  However, the Court could not be certain if they have sketchy knowledge of the predicate offence which is a phone scam.  Under such circumstances, the Court would not enhance the sentence due to the prevalence of offence.

49.  The first defendant is sentenced to Training Centre. The second defendant is sentenced to 17 months’ imprisonment.