HKSAR v. LEE CHEUK HO

DCCC 1116/2021

[2023] HKDC 385

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 1116 OF 2021

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REASONS FOR SENTENCE

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1.  The D pleaded guilty to a charge of theft, between March 2012 and June 2015, he stole $2,843,998.6 belonging to his employer’s companies.

Summary of facts

2.  Since late 2011, D has been employed as an accounting clerk to manage the accounts of PW1’s 3 companies.  In December 2014, PW2 was employed to assist D.

3.  On 23 June 2015, PW1 instructed PW2 to take over the duty of D.  The D failed to show up on the next day.

4.  In early July 2015, the D called PW1 and confessed that he had stolen more than HK$1 million from the companies.

5.  After inspection from all the records and according to PW3’s calculation, the D had stolen some HK$4,493,422.77 from the companies between March 2012 and June 2015 by practicing the following modus operandi:-

(a)  Falsely inflating his monthly salary and used the company’s computer system to give false instructions to the banks for effecting transfers of money into his own bank account.

(b)  Falsely induced PW1 to endorse crossed cheque by claiming those relate to MPF contribution of staff. The cheque were then transferred to D’s HSBC credit card account.

(c)  Falsely induced PW1 to endorse uncrossed cheque by claiming those relate to reimbursement of the staff (eg salary payment and payment of goods). The cheque were then presented at the bank counter by D and were cashed.

(d)  Writing his own name as the payee on various cheque pre-signed by PW1, and depositing the same into D’s own bank account.

6.  Later, PW1 received a letter dated 24 July 2015 from D by post. D admitted the offence and apologized for the embezzlement of about HK$3,287,099.08. In the letter, D promised to repay the remaining sum by way of instalments.

7.  After making a repayment of about HK$2,619,000, D failed to honour the undertaking.  On 13 October 2015.  PW1 accompanied D to the police station. The case was reported and D surrendered to the police.

Arrest & Cautioned Statements

8.  D was arrested on 13 October 2015. Under arrest and caution, he admitted stealing money of about HK$2 million from PW1’s companies.

9.  In six subsequently conducted cautioned VRIs, D said inter alia: -

(a)  He was employed by PW1 to work as an accounting clerk in PW1’s companies since September 2011

(b)  He volunteered himself to the police to bear the responsibility for the present case. He admitted stealing money from PW1’s companies between early 2012 and June 2015. He did so out of greed and due to his heavy gambling debt.

(c)  He had spent all monies to repay his gambling debt (soccer gambling via Hong Kong Jockey Club)  as well as payment of personal expenses (eg Mortgage payment of his residence, shopping, food or entertainment)  etc.

(d)  He admitted having confessed to PW1 on 6 July 2015 that he had stolen the money from PW1’s companies. He had already repaid PW1 a total of about HK$2,610,000.

(e)  Later, he learnt from PW2 that the total stolen amount was about HK$4.1 million. He knew by then he would never be able to settle the remaining balance.

(f)  The relevant records of fraudulent transaction were shown to him. He admitted making the relevant fraudulent transactions amounting to a total of HK$2,294,279.22 (using the modus operandi in para 5(a)-(c)  above).

Other evidence

10.  Bank records and computer records showed that a total of HK$549,719.38 has been stolen by D using the modus operandi in para 5(d)  above.

11.  At the material time of the offence, D stole from PW1’s companies HK$2,843,998.60.

Criminal record

12.  The D has a clear record.

Mitigation

13.  The D is 46 years old.  He worked for PW1’s companies as an accounting clerk from September 2011 to June 2015 with his last monthly salary of $17,500.

14.  He committed the offence due to his gambling debts and overspending.

15.  When the D confessed to PW1 that he had stolen the companies’ fund, his son was just one week old.  Because of this incident, his wife divorced him without access to his son.

16.  His own family also cut ties from him.

17.  He is currently living with his girlfriend and they have a 6 months old baby girl.

18.  The D just resigned from his job as second head chef of a fast food restaurant this month as he is aware that he is going to face a period of sentence.

19.  Today, the defence submitted 2 letters of mitigation to this court.  One from his current girlfriend who asked for leniency on his behalf.  The other one was from the D himself.  In a gist, he admitted that he was wrong, the price to pay for was the loss of his immediate family members, however, he has rehabilitated himself by working as a chef.  He sincerely apologized to PW1 for his wrong doings.

20.  The D asked for a lenient sentence, in view of the facts that:-

(a)  He made confession to PW1 and police, fully cooperate with the police, indicate his remorse by pleading guilty;

(b)  The delay in prosecution;

(c)  92 % of restitution;

(d)  The D has rehabilitated himself during this period of time, see Secretary of Justice v Hui Siu Man [1992] 2 HKLRD 236

Sentence

21.  The defence accepted that this a case of breach of trust which involved about 2.8 million.  According to HKSAR v Ng Kwok Wing [2008] 4 HKLRD 1017, it falls into the sentencing bracket of 3 to 5 years for the amount of 1 to 3 million.

22.  The D was an accounting clerk in the victim’s companies, he abused his position and the trust that PW1 had placed upon him to embezzle the 2.8 million over a period of 3 year 3 months by practicing the modus operandi as stated in paragraph 5 of the summary of facts.

23.  The D deliberately and methodically embezzled about 2.8 million from his employer over a long period of time.

24.  It is a grave breach of trust.

25.  Accordingly, I consider that a starting point of 4 years and 9 months is appropriate in the present case.  I reduce the sentence to 3 years 2 months because of his guilty plea.

26.  It is accepted that the D had repaid some 2.6 million to PW1 by borrowing money from his family.  That accounts for 92% of the total sum that he was charged for. 

27.  It was a swift and substantial payment after the D had confessed to PW1 of his stealing.

(a)  6 July 2015 – confession made;

(b)  13 July 2015 – repayment of 2 million;

(c)  21 July2015 – total payment of 2.6 million.

28.  As to the remaining balance of about $225,000, the D has no financial resources to pay.  He earned $19,800 in his last job.

29.  In the case Hui Siu Man, the court said that voluntary restitution is something which “must be encouraged and that this can only be done if real weight is given to it as a factor of mitigating in sentence.”  However, it can never be viewed as an exceptional circumstance to justify a suspended sentence.

30.  As such, I reduce the sentence by a further 6 months.

31.  As to the point of delay, the Prosecution has properly prepared a time line of events, from that I can see there were a huge amounts of bank records and documents, totaling to 4000 pages.

32.  This case involved 3 companies accounts covered a period of 3 years and 3 months, there were numerous cheque that the police needed to investigate.  It takes time to know the full extent of the total amount that the D had embezzled over the years.

33.  It was a complicated investigation as the police also needed to interview and take statements from witnesses, including the former staffs of the companies.

34.  When the D was temporarily released with bail sum returned to him between 7/2019 to 8/2021, the police was still conducting investigation.

35.  The ambit of those enquiry was extensive.

36.  When the D was re-arrested and charged in 10/2021 and subsequently set down for hearing in 9/2022, this period of time cannot be counted as delay as the case has entered into the normal operation of the criminal justice system.

37.  I accepted that the police had conducted an active investigation in the present case, I ruled that there is no inordinate delay on their part.

38.  On the other hand, the D in his own letter tells me that he has been subjected to mental pressure for the last 8 years.  He also works hard to re-establish himself.

39.  I further discount the sentence by two months.

40.  The usual 1/3 discount covers his guilty plea, his cooperation with the police and his confession to PW1.  He is not entitled to any further discount. (S J v Lee Chun Ho Jeff [2009] 6 HKC 471 refers)

41.  The D is to serve a period of 30 months’ imprisonment (3 years 2 months – 6 months – 2 months = 30 months).