HKSAR v. CHIU MEI SZE

DCCC 749/2024 & 114/2025(Consolidated)

[2026] HKDC 687

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NOS 749 OF 2024 AND 114 OF 2025

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REASONS FOR SENTENCE

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1.  There are 2 Charges in the Amended Consolidated Charge Sheet faced by the defendant Chiu Mei Sze (“D”), both being “Conspiracy to deal with property known or believed to represent proceeds of an indictable offence” (commonly known as “money laundering”), contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap.455 (“OSCO”) and sections 159A and 159C of the Crimes Ordinance, Cap.200.

2.  Particulars of Offence for the 1^st Charge stated that between 31March and 12 October 2022, D conspired with Wu Chi Wai (“Wu”) to deal with a total sum of HK$8,020,572.75 in a particular bank account with Hang Seng Bank Limited (“the HSB Account”), knowing or having reasonable grounds to believe that the money, in whole or in part directly or indirectly represented any person’s proceeds of an indictable offence. Particulars of Offence for the 2^nd Charge are in similar form, relating to a period between 1 and 17 June 2022, involving HK$15,827.71 in a bank account with Welab Bank Limited.

3.  On her own plea and admission of the Amended Summary of Facts, she was convicted of the 1^st Charge. On the application by the prosecution and without any objection by the defence, I ordered that the 2^nd Charge be left on the Court file and not be proceeded with without the leave of the Court.

Facts of the case

4.  According to the Amended Summary of Facts admitted by D, the HSB Account was opened by D on 31 March 2022. She presented her Hong Kong permanent identity card as proof of identity in support of her application. In her application she claimed, inter alia:

(a) she opens the personal account for “payroll”; and

(b) she is a part-time cleaning worker, earning about HK$15,000 per year.

5.  Between April and May 2022, 8 citizens were deceived into making investments through an untrusted website or mobile app.  To make investments (which never existed), each of them followed the scammer’s instructions to pay money into designated bank accounts, including the HSB Account, as investment capital as follows:

Citizen	Net Loss Suffered (HK$)	Money paid into the HSB Account (HK$)
1	$2,220,000.00	$100,000.00
2	$1,755,147.10	$53,000.00
3	$1,493,800.00	$112,400.00
4	$1,392,229.00	$72,000.00
5	$872,319.00	$112,398.00
6	$650,170.00	$316,000.00
7	$612,900.00	$1,000.00
8	$361,610.69	$47,000.00
Total:	$9,358,175.79	$813,798.00

6.  These 8 citizens subsequently realized they were being deceived, and reported the deception to the Hong Kong Police Force.

7.  Between 31 March 2022 and 16 May 2022, there had been HK$ 8,020,572.75 credited to the HSB Account through 112 deposits; 95 deposits originated from the bank account of 67 individuals (including the 8 victims above, involving HK$5,613,163.44) and 17 deposits made by depositors whose identity are unknown, through cash, cheque or remittance (involving HK$ 2,407,409.31) while HK$8,020,486.50 were withdrawn from the HSB Account through 90 withdrawals during the same period. Money credited to the HSB Account were withdrawn on the day of receipt or on the next day. On 16 May 2022, the HSB Account held as closing balance HK$86.25.  Since then, it had not initiated any financial activity. On 12 October 2022, the HSB Account was closed by the bank.

8.  On 22 February 2023, D was arrested by the police. Under caution, she stated that half a year ago, she lent the HSB Account’s bank card and her identity card to a friend Wu, to transfer funds; she did not know that the bank account would be used to scam people. In a subsequent video-recorded interview, she stated under caution, inter alia, that:

(a) she opened the HSB Account to receive salary payments but has never used it since its opening because her employer pays her in cash. She has worked as a cleaner for the MTR Hong Kong station for 2 years, earning about HK$450 per day;

(b) half a year ago, she has lent the HSB Account, a bank card and its PIN, and her identity card to her fellow of a Christian group Wu, to transfer funds with the Faster Payment System. By then, she had met Wu for once or twice. She does not know the phone number or residential address of Wu; and

(c) she has not asked Wu about how did he use the HSB Account or what was the nature of funds being transferred.

9.  When asked about specific transactions the HSB Account executed and the names of persons who transferred funds to the bank account, D asserted she did not know any of them.

10.  Subsequent investigation by the police revealed that between 31 March 2021 and 12 October 2022, D had remained in Hong Kong. For the fiscal years 2015/16 to 13 September 2023, only 2 body corporates reported having paid remuneration to her totalling HK$22,460,  and she had not filed any tax return or made payment for tax in Hong Kong.

11.  D now admits that during the relevant period she had an agreement with Wu to allow the latter to use her HSB Account, having reasonable grounds to believe the monies which would be passing through it are and will remain tainted monies, and the agreement eventually materialized.

Application for enhancement of sentence

12.  The Prosecution applied for an enhancement of sentence pursuant to section 27 of the OSCO on the grounds of prevalence of the offence and harm caused to the community. Pursuant to section 27(2), a statement of Chief Inspector Li Yiu-nam dated 12 February 2026 was submitted in support of the application.

Backgrounds of D and mitigations

13.  D is 53 years old, born in Hong Kong on 11 February 1973. She is divorced with a 26 years old daughter. She held a Bachelor degree from a university in New Zealand. At the time of the arrest she was working as a cleaning worker, earning about HK$8,000 per month. In July 2006 she was convicted of “Manslaughter” and “Cruelty to a Child”, and was sentenced to a total of 10 years imprisonment.

14.  Mr Young, representing D, submitted in mitigation that both D’s parents were schoolteachers.  She has an older and a younger brother.  When she was 16 years old, her family emigrated to New Zealand. She completed high school and 2 years of a university programme in fashion design.  Her parents then separated and she eventually returned to Hong Kong.

15.  After returning to Hong Kong, D married and gave birth to a daughter in or around the year 2000.  Her daughter still lives in Hong Kong, and D sees her once a year.

16.  D had a second daughter in 2003, who tragically died after 4 months while in the care of D and her then boyfriend (the second daughter’s father).  In relation to this incident, both parents were convicted in July 2006 of “Cruelty to a Child” and “Manslaughter” and sentenced to 10 years’ imprisonment.  She was released from prison in 2012 and remained under post-release supervision until 2014. 

17.  So far as employment is concerned, D has engaged in different forms of employment including as a kindergarten teacher, licensed carer for senior citizens, a data entry clerk, and most recently a cleaner in MTR stations.  She has also become a devoted member of “The Church in Hong Kong” and has been friends with the deacon of that church, Deacon Yu Kai Wing, for the past 10 years.

18.  Mr Young submitted a letter written by D and 2 others by Deacon Yu. In her own letter, D asserts she feels deeply remorseful for having committed this offence and is willing “to plead guilty and accept legal responsibility”.  Since being diagnosed with postpartum depression and schizophrenia, she has regularly attended psychiatric appointments and has been “unable to work as a normal person”.  She attends church weekly and participates in church services such as tutoring, choir, Sunday school and prayer meetings.  At the time of the offence, she had a boyfriend who accumulated huge debts. After they broke up, she filed for bankruptcy and got married again.  She says, “I know I have made a grave mistake and hope for a lenient sentence”. 

19.  In his letters to the Court, Deacon Yu describes D as being “a very devout Christian” who “attends church several times a week and is very zealous in her service”.  He describes how she has cared for others and sacrificed her money, food, and time to help others.  Deacon Yu is aware of D’s “severe mental illness”, which has led her to constantly borrow money from others for herself and her boyfriend.  He writes that she “is a thoughtless person and easily trusts others, making her easily deceived ”.  She has “very poor analytical abilities”.  He tells of D needing money urgently in March 2022 and borrowing money from Wu.  Wu asked her to open an account at Hang Seng Bank so his company could pay him wages; his own bank would not open such an account due to his bad debts. As D “trusts others easily”, she opened the account for Wu and handed him her bank card and PIN. It is to be noted that in his 2^nd letter, Deacon Yu also mentioned that D did this for Wu for a reward of HK$3,000.

20.  Mr Young also submitted 2 medical reports from 2 separate Psychiatrists (Dr Danny Tam and Dr Li Cheuk Wing) indicating that D has been suffering from mental illness for quite some time prior to the present offence. Since 29 October 2012, she has continuously been under a conditional discharge order made under section 42B(1) of the Mental Health Ordinance (Cap 136). She was diagnosed with Paranoid Schizophrenia and has continuously been treated by psychiatrists while taking anti-psychotic medication for the past 13 years. In addition, the records from the Hospital Authority confirm that she had psychiatric consultations on an almost monthly basis from 2012 to 2022.  While she normally attends her scheduled appointments, it is noticeable that in 2022 (the year of the present offence) she struggled to meet her appointments and was consistently overdue.

21.  Dr Tam’s letter and D’s medical records confirm that she suffered serious psychotic symptoms from her mental illness when in prison in 2008 and 2010, and in the period immediately after she was released from prison in 2012.

22.  In 2025, Dr Li’s report found that D’s “schizophrenia was in partial remission in the period from March 2022 to October 2022” and still “suffers from functional impairments from her schizophrenia and is vulnerable to exploitation”.

23.  On the basis of the above information, Mr Young submitted that at the time of the offence D was vulnerable to exploitation, her culpability for the offence is of the lowest order because:

(a) she had no actual knowledge of the predicate offence or of the tainted quality of the funds passing through her bank account – her liability is based only on having reasonable grounds to believe;

(b) her role was confined to the outset but had no further involvement in the offence after control over the bank account was handled over to Wu, who was the principal offender; and

(c) Wu exploited her long-term mental illness in order to gain control over her bank account – this is an exceptional circumstance in this present case.

24.  Mr Young submitted that Wu took advantage of D’s desperate need for money and impaired mental condition at the time and lured her into committing the present offence, and requested that the Court consider a starting point sentence in the neighbourhood of 30 months’ imprisonment.  Less the one-third discount for a timely plea of guilty, he submitted that the sentence should be around 20 months’ imprisonment.

Enhancement of sentence

25.  As to the application for enhancement of sentence, while not disputing the contents of the statement by CIP Li, Mr Young objected to the application on 3 grounds:

(a) the evidence is insufficient to show a progressive or widespread prevalence of the specified offence, citing HKSAR v Li Kin Keung^[1] and HKSAR v Fong Chi Yam^[2] in support;

(b) the evidence is insufficient to show the actual harm to the community from recent occurrences of the specified offence； and

(c) relying on the mental condition of D at the time of the offence, any enhancement would not be “fit” and thus the discretion to enhance should not be exercised.

Assessment of sentence

26.  Although the Charge under consideration is Conspiracy to commit money laundering, the principles governing sentencing in money laundering cases equally apply^[3].

27.  In Secretary for Justice v Wan Kwok Keung (雲國强)^[4], Yeung JA (as he then was) stated:

“12. “Money laundering” is a serious offence for not only does it encourage criminal activities indirectly, but also attempt to legitimize the proceeds of crime. In order to crack down on serious crimes, to prevent offenders from getting financial gains, it is necessary to deter the commission of the “money laundering” offence.

…..

15. …The sentencing starting point is 3 years or so where the “black money” involved is between 1 million and 2 million dollars, 4 years or so where it is between 3 million and 6 million dollars, and could be over 5 years where it is above 10 million dollars.”

28.  In that passage, Yeung JA was not laying down any guideline, it was just an observation of the sentences meted out by the Court in previous similar cases. However, I consider that to be useful indicators to be taken into account when assessing the appropriate sentence.

29.  As Stock VP pointed out in HKSAR v Boma^[5], given the highly variable circumstances in which the offence might be committed, it is difficult and undesirable to offer guidelines in money laundering cases. Also, the amount of money laundered is not the “be-all and end-all” of a case but is a significant feature. Other factors that should be taken into account when assessing the appropriate sentence include:

(1) the nature and penalty of the predicate offence;

(2) knowledge of the offender as to the predicate offence;

(3) international dimension;

(4) the sophistication of the offence;

(5) whether organized syndicate is involved;

(6) the length of time and number of transactions involved;

(7) whether the offender continued to launder funds after discovering the tainted nature of the funds; and

(8) the role played by the offender and the benefit received by him.

30.  In the present case the tainted money came from on-line investment fraud. However, I accept that there is no evidence to suggest that D was aware of the predicate offence. There are no international element and no sophisticated operation involved. Her previous convictions arose from a tragic family saga and were not similar to the present case, I will not take them into consideration when assessing the sentence in this case. However, the offence covered a period of over one and a half months, involving 112 deposits totalling over HK$8 million and 90 withdrawals of similar amount.

31.  In the course of mitigation, it was suggested that D did this for Wu without any financial benefit. However, it was submitted by Mr Young, and supported by Deacon Yu, that at the time of the commission of the offence, D was in dire financial situation and Wu exploited her difficult situation and her mental health problem, and lured her into the commission of the present offence. D admitted that at the time she had met Wu once or twice only and did not know his phone number or residential address. Deacon Yu stated in his 2^nd mitigation letter that D did this for Wu for a reward of HK$3,000. Upon taking further instructions, Mr Young stated that D maintained that she had not received any financial reward in the commission of this offence, and asked the Court to ignore the 2^nd letter by Deacon Yu.

32.  Having considered all relevant materials before me, including the fact that D stated to the bank the HSB Account was opened for receiving salary when she had been paid in cash as a cleaner for the past 2 years, that tainted money channeled through the HSB Account right after it was opened, and the information submitted during mitigation mentioned above, I do not accept that at the time when D agreed to open the account for Wu, she did it for no financial reward. It might well be that subsequently for various reasons she had not actually received the reward, but given the Charge is Conspiracy to commit money laundering, that is neither here nor there.

33.  I accept that D had been suffering from mental illness for quite some time prior to the commission of the offence. As described by Dr Li, she was in partial remission of schizophrenia at the time of the offence, and suffered from functional impairments and was thus vulnerable to exploitation. I take it to mean, as stated by Deacon Yu, that at the time she had very poor analytical abilities, easily trusting others making her easily deceived.

34.  With this in mind, I am prepared to accept that D trusted Wu that the account was to be used for receiving salary and subjectively was not aware that it would be used for money laundering purpose. This is one of the rare situations as described by the CFA in HKSAR v Harjani Haresh Murlidhar^[6], when the Court could take into account and adjust the sentence in favour of D. I am also mindful of the importance of individual justice as stated by the CA in HKSAR v Lam Ka Sin^[7] in similar cases.

35.  Having taken all relevant matters into consideration, I consider 39 months to be the appropriate starting point in this case. D pleaded guilty at the outset and is entitled to the customary 1/3 discount, reducing the sentence to 26 months.

Enhancement of sentence

36.  The Prosecution applied for an enhancement of sentence under section 27 of OSCO. It is submitted that this offence is prevalent and extensive harm is caused to the community.

37.  I accept that the power under section 27 of OSCO is an extraordinary power which ought to be used sparingly and only when the Court is satisfied that exceptional circumstances do exist warranting the exercise of such power^[8]. Also, it is prevalence at the time of the sentence is imposed which counts, not prevalence at the time when the offence arose^[9].

38.  The basis of the application by the Prosecution is that D committed the offence by lending her own bank account to others, i.e., as a “stooge”. The use of “stooge” account in committing money laundering offence has long been accepted by the Court as the basis for enhancement of sentence^[10]. It is not money laundering in its generic form and does not infringe the principle as stated by the CA in Li Kin Keung. I do not accept Mr Young’s submission that the principle in Li Kin Keung only refers to the “Particulars of Offence”, not modus operandi as, e.g., the use of stooge account.

39.  The statistics provided by CIP Li covers periods from 2020 to 2025. It is obvious that deception and money laundering cases involving stooge accounts have been on the rise, both in terms of the number of cases reported and monetary loss. The number of stooges arrested and the amount of money loss in relation to these cases have slightly dropped from 2024 to 2025 but is still very prevalent. The harm caused to the community of money laundering offences involving stooge accounts as stated in the statement speaks for itself.

40.  These statistics and statement of harm caused to the community related to offenders having minimal or no involvement in, or minimal or no knowledge on, the predicate offence. As such, the principle in Fong Chi Yam is not engaged.

41.  The fact that D was suffering from functional impairments due to her mental condition and was vulnerable to exploitation has been taken into account when assessing the appropriate starting point. I do not agree that this factor alone should create a special category of offenders making it not “fit” for the Court to exercise the discretionary power to order enhancement of sentence.

42.  Taking all relevant matters into consideration, I am satisfied the Prosecution has made out a case under section 27 of OSCO. I allow the application for the enhancement of sentence in the present case.

43.  As to the quantum of enhancement, although there are signs of easing off in 2025 as compared to 2024, the situation is still highly unsatisfactory. The enhancement must be sufficient to achieve its purpose, i.e., to deter future potential offender in committing the specified offence, i.e., committing money laundering offence by acting as a “stooge”. I order that 6 months (about 23%) be added to the sentence.

Conclusion

44.  For the offence D has pleaded guilty to, she is sentenced to 32 months imprisonment.