HKSAR v. TSE PUI YI, FLORA

DCCC 1360/2024

[2025] HKDC 2128

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 1360 OF 2024

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REASONS FOR SENTENCE

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The defendant pleaded guilty to a charge of "Money laundering". In short, she let someone use her bank account.

Summary of Facts

2.  On 21 September 2020, the defendant opened a bank account (No.012-735-2-018347-6)  with the Bank of China (the "Account").  She was its sole signatory. In the opening mandate, the defendant claimed to be residing in a public housing unit.

Phone deception

3.  Between October and November 2020, Mr. Spear (PW1), a US citizen, was deceived in a "Pretending to be law enforcement officer" telephone scam.  In order to prove his innocence, PW1 was asked to transfer sums of money to various bank accounts, which aggregated to a sum of US$454,000.  Of the transfers he made, three in the sums of US$114,992.30, US$99,492.30 and US$99,500 were remitted to the Account.  PW1 later realized that he was deceived and reported the matter to Hong Kong Police.

Deposits and withdrawals

4.  Between 15 October and 26 November 2020, the Account received 10 remittances, which aggregated to a sum of US$653,880.70 (including the 3 sums from PW1).  Each remittance was disposed of within 7.5 hours after receipt.  The Account was closed on 17 December 2020 with a balance of HK$92.88.  Based on the timing and amount of the deposits and withdrawals, the Police found a "mirror pattern" in those transactions, which is a typical indicator of money laundering.

Arrest

5.  The defendant was arrested on 3 September 2021 at her home in Sau Mau Ping.  After a house search, the Police found 2 remittance advices in respect of the 9^th and 10^th remittances (money wired in by 2 different persons from the United States).

6.  The defendant's reported income and tax records are not commensurate with the magnitude of the deposits received by the Account.

7.  The defendant now admits that during the offence period, she, knowing or having reasonable grounds to believe that the total sum of US$653,880.70 received by the Account, in whole or in part, directly or indirectly, represented the proceeds of an indictable offence, had dealt with the said sum.

Mitigation & Sentence

8.  The defendant is 23 and has a clear record.  Defence counsel Mr. Ng informed me that the defendant was only 18 when she committed the offence.  She is now supposed to be a third-year Fashion Design major at a local university.  Unfortunately, she suffers from Major Depressive Disorder because of this case.  She needs to receive regular psychiatric treatment (both consultation and medication).  As a result, she is taking voluntary leave from school.  She is expected to resume her studies in the 2025-26 academic year Semester 3[1].  According to Mr. Ng, the defendant is only allowed to take up to 2 years of voluntary leave; otherwise she will be expelled from the university[2].  It is unclear as to when the defendant must resume her studies.  The information presented to me seems to indicate that she has only been granted 2 semesters of leave so far.

9.  In mitigation, Mr. Ng submitted that the defendant mistrusted a close female friend ("Y")  from secondary school.  Y suggested that both she and the defendant lend their bank accounts to a friend of Y's.  After the defendant had lent the Account to Y's friend, Y told the defendant that due to personal reasons, Y could not lend her own bank account to Y's friend.  Yet, the defendant had failed to notice the peculiarities of what Y had asked her to do.  Finally, Mr. Ng complained about undue delay in this case.

10. I will deal with the issue of "delay" first. Mr. Lee for the prosecution has helpfully prepared a Chronology of Events for my reference. According to the chronology, after receiving PW1's complaint in March 2021, the police had in mind 3 suspects (Zhao, Yu and the defendant). The defendant and Zhao were arrested in September 2021. In November 2021, the police found out that Yu was in Taiwan and listed him as a wanted person. The defendant was unconditionally released in April 2022.

11. Yu was arrested in April 2023. In July 2023, the police sought legal advice from the Department of Justice (DoJ)  regarding Yu. In October 2023, the police withdrew Yu's case file from the DoJ due to missing bank records. On 7 November 2023, the police sought legal advice from the DoJ regarding Zhao. On 17 November 2023, the DoJ issued advice regarding Zhao. On 20 February 2024, the police sought legal advice from the DoJ regarding Yu. On 28 February 2024, the DoJ issued advice regarding Yu.

12. On 19 April 2024, the police sought legal advice from the DoJ regarding the defendant. On 8 August 2024, the DoJ issued advice regarding the defendant. The defendant was charged on 9 September 2024 and was brought to a magistracy on the following day. This case first reached the District Court on 12 November 2024. After a mention hearing in January 2025, on 1 April 2025, the defendant indicated her intention to plead guilty to the charge. This case was then fixed for plea on 12 November 2025.

13. Based on the chronology, I am unable to see that anything substantive was done in relation to the defendant between her initial arrest in September 2021 and the submission of the case file to the DoJ for legal advice in April 2024. Compared with the police, the DoJ acted relatively promptly, issuing advice regarding the defendant in August 2024. I have asked Mr. Lee what the police's initial view of the defendant was (i.e. whether she was a main target or an offshoot during the investigation). Mr. Lee informed me that the investigating officer of this case had been replaced twice, and the OC Case at least once. The prosecution is unable to obtain a comprehensive record of the progress of this case.

14. The ball, at least the portion related the defendant, was in the police's side of the court for 2.5 years. Then it took the DoJ 4 months to issue legal advice. In other words, from initial arrest to formally charging the defendant, it took roughly 3 years. Without further information regarding what the police had done in those 2.5 years, I consider it undue delay. In any event, from the initial arrest to her guilty plea before me, the defendant was in agony for 4 years. She has my sympathy.

15. The prosecution has applied for an enhanced sentence pursuant to section 27(2)(c)  and (d)  of the Organized and Serious Crimes Ordinance (Cap.455)  on the basis of prevalence as well as the nature and extent of harm caused to the community. Mr. Ng did not object.

16. I bear in mind the Court of Appeal's decision in HKSAR v Xu Mai Qing CACC 464/2005, whereas Yeung JA (as he then was)  held "Under section 27(11)  of OSCO, what the prosecution has to prove is the prevalence of the offence, not the increase in the number of such offences[3]."

17. I have read the witness statement of CIP Li dated 21 October 2025. I am satisfied that in 2020, deception-related money laundering cases were prevalent in Hong Kong in terms of the number of cases as well as the total value of monetary loss.

18. There is clear and cogent evidence before me that money laundering through bank accounts opened by "ML Stooges" remains widespread in Hong Kong today. What true criminals need are gullible scapegoats, like the defendant in the present case, who would take the blame for them when law enforcement takes action. The court must send a clear message to the general public that people who play the role of "ML Stooge" will receive severe punishment, so that there is a deterrent effect. When there are few or no willing "ML Stooges", criminal activities which rely on their bank accounts will fail.

19. This is a typical case of money laundering by way of a stooge bank account. Even if the defendant did not know about the phone deception against PW1, such a scam would have been meaningless without the Account. Assuming what the defendant said is true, given her role, the total sum which went through the Account and the overall circumstances, I grant the prosecution's application and will enhance the sentence by 25%.

20. The Court of Appeal in SJ v Wan Kwok Keung [2012] 1 HKLRD 201 held :-

Generally, the sentence for "money laundering" offences should mainly reflect the amount of "black money" laundered and not the benefit obtained by the defendant or others. The reason being that it is very difficult to prove the benefit concerned, and in most "money laundering" cases, there may not be evidence to show from what indictable offence the "black money" are in fact derived. Of course, if there is information to prove that the "black money" is originated from serious crimes, including drug trafficking, kidnap and blackmail, illegal human trafficking, other organized crimes, etc. or the defendant's benefit is huge, then the sentence should be adjusted upward.[4]

21. In determining the proper starting point, I have reminded myself of the sentencing principles laid down in HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545 and HKSAR v Boma Amaso [2012] 2 HKLRD 33. I have also borne in mind the amount of money involved, the duration of the offence, the defendant's role in relation to the movements of funds as well as her personal circumstances.

22. In SJ v Ngai Fung Sin Apple [2013] 5 HKLRD 104, Yeung V-P held :-

Generally speaking, the sentence passed in a "money laundering" case is 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…[5]

23. I accept there is no evidence showing that the defendant was involved in or had any knowledge of any predicate offence. As the sole owner of the Account, the defendant should have retained its ultimate control and paid attention to its transactions on a regular basis. On the other hand, I cannot overlook the fact that a total sum of HK$5 million odd[6] went through the Account within 1.5 months.

24. By lending her bank account to someone and thus allowing funds of unknown origins to pass through the Account, the defendant played a pivotal role in helping the mastermind(s)  of criminal activities to access their illegal funds without revealing their identities.

25. I consider a starting point of 5 years' imprisonment appropriate and just[7]. With the timely guilty plea, the sentence is reduced to 40 months. With the 25% enhancement, the sentence becomes 50 months. I would grant an additional discount of 5 months to reflect the undue delay, reducing the sentence to 45 months.

26. Had the defendant been brought to court in a timely fashion, it is highly likely that she would have been under 21 at the time of sentencing. Hence, section 109A of the Criminal Procedure Ordinance (Cap.221)  would apply, and imprisonment would have been the last resort, unless the court is of the opinion that no other method of dealing with her is appropriate.

27. At present, my hands are tied. Sentencing options which are created for the benefit of young offenders such as Rehabilitation Centre, Detention Centre and Training Centre are no longer available for my consideration because the defendant is now over 21.

28. The defendant was first arrested by the police in September 2021, but she did not give up on her future. When she was released unconditionally in April 2022, she decided to pursue her dreams in Fashion Design. She has worked hard and has done well in her Higher Diploma in Fashion Image Design course, which enabled her to enter a degree programme in Fashion Design at a local university in 2024. This is a significant achievement for someone who did not perform well academically in secondary school[8].

29. I have not overlooked her contribution as a volunteer and employee at Sik Sik Yuen, a well-known charity in Hong Kong. It is just the icing on the cake compared to her recent academic performance. I accept Mr. Ng's submission that the defendant has reformed and rehabilitated herself in the past 4 years.

30. I am aware of the Court of Appeal's remarks in Secretary for Justice v Chan Chi Tao[9] [2020] HKCA 296 (an unreported Chinese judgment). As much as I would like to allow the defendant to continue with her studies, my powers are limited by section 109B of Cap.221. I cannot suspend her sentence because it is longer than 2 years. Even without the enhancement, it still exceeds the limit.

31. The aggregated sum which went through the Account is too large for me to temper justice with mercy. I see no reasons to depart from the sentencing guidelines laid down by the Court of Appeal. What I can do is to invite the administration of her university to allow the defendant to resume her studies upon her release from prison. Based on the information before me, I see a promising student determined to excel in the fashion industry. What she did when she was 18 bears no relation to her current studies and occurred long before she became a university student. Like many famous designers who were given their big breaks when they were young, the defendant deserves hers.

32. With some sadness and reluctance, I sentence the defendant to 45 months' imprisonment.