HKSAR v. WU YANGJIN

DCCC 916/2014

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 916 OF 2014

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

---------------------
Reasons for Sentence
---------------------

1.  On 6 January 2015, the defendant pleaded guilty to one charge of conspiracy to deal with property known or believed to represent proceeds of an indictable offence. The crime conspired to commit is commonly known as money laundering. The predicate offence was a telephone deception case where the defendant was the legman responsible for collecting the money in the operation.

2.  The facts he admitted reveal that on 3 September 2014, a 79-year-old man, Mr Ho, received a landline call at home from a male who pretended to be his son, saying that he had been beaten as he owed people money.  Another male took over the phone and demanded for settlement of the debt.  Mr Ho reported the case to the police.

3.  Police officers soon arrived and confirmed the safety of Mr Ho’s son, revealing this scam.  An operation was mounted for Mr Ho to deliver a dummy moneybag to the culprits. 

4.  On the following day, a male called Mr Ho again.  Following the instruction of that male, Mr Ho arrived at Po On Road playground where the defendant showed up.  The defendant said to Mr Ho that his boss told him to come to collect the money.  He also asked whether the amount was HK$120,000.  The defendant handed over his phone to Mr Ho.  A male on the phone said he sent the defendant to collect the money.  When Mr Ho handed over the dummy moneybag to the defendant, police officers laying ambush in the vicinity intercepted and arrested the defendant.

5.  Under caution, the defendant said his friend, Ah Sing, asked him to come to collect money from the old man.  Police officers seized from him two mobile phones, a bankcard and cash of HK$779 and RMB52 yuan. 

6.  In his subsequent video-recorded interviews, the defendant further said a friend in the mainland, Ah Sing, owed him about RMB10,000 yuan.  He instructed the defendant to go to the playground to collect from an old man HK$30,000 of which the defendant could take 10,000 to settle the debt.  He said he did not know where the money he collected had come from.

7.  Immigration check reveals that the defendant came to Hong Kong on 1 September 2014 via Shenzhen Bay Control Point. 

8.  As the defendant claimed that he did not know where the money he collected had come from, inquiries were made by the court to clarify the basis of the plea.  Solicitor then representing the defendant, admitting that he had no knowledge of the recent decision of the CFA in Pang Hung Fai FACC No. 8 of 2013 and not being sure of the propriety of the plea, asked for an adjournment of the case for counsel’s advice to be sought.  The adjournment was granted.

9.  In the resumed hearing on 3 February 2015, Mr Yip of counsel now representing the defendant confirms that the defendant maintains his guilty plea which is a proper one in the judgment of Mr Yip on the reasonable-grounds-to-believe limb of the offence.  That basis of plea is acceptable to the prosecution.  The defendant is convicted accordingly.

10.  The prosecution applies for enhancement of the sentence under section 27(2) of the Organised and Serious Crimes Ordinance, Cap 455 on grounds of prevalence and harm caused to community.  The application is opposed to by the defendant. 

11.  To prove the application, the prosecution only relies on the statement of Chief Inspector Lam Cheuk-ho dated 16 December 2014.  Content of the statement is admitted under section 65C of the Criminal Procedure Ordinance, save and except that certain paragraphs being opinions are admitted under section 65B of that ordinance. 

12.  It is submitted by Mr Yip that the information in the statement, though not challenged, cannot prove the grounds for enhancement of sentence.  He argues that the statement of Chief Inspector Lam essentially deals with drop-off-type telephone deception case.  It does not give information of money-laundering cases in general.

13.  Moreover, there is also a slight decrease in the number of cases and the amount of loss in telephone deception cases in 2014 compared to 2013.  Mr Yip relies on the Reasons for Sentence in HKSAR v Ma Jialang(馬加浪) DCCC 749 of 2014.  In that case, the learned judge, having considered a similar statement prepared by Chief Inspector Lam dated 7 October 2014, refused to order enhancement.

14.  Drop-off cases referred to in the statement of Chief Inspector Lam means the category of telephone deception case adopting the modus operandi of physical handover of cash. 

15.  The record of the police shows that there was no drop-off case reported in 2006 and 2007.  The number of drop-off cases, however, gradually increased to 126 cases in 2010, 149 cases in 2011, 169 cases in 2012, 200 cases in 2013 and 160 cases for January to November 2014 (see annex A of Chief Inspector Lam’s statement).

16.  It is also noted that the total number of telephone deception reports received also rose from 1,623 cases in 2007 to 2,314 cases in 2012.  The number dropped slightly to 2,047 cases in 2013 and 2,035 cases for January to November 2014.

17.  I will first deal with the criticism that the information of Chief Inspector Lam only relates to telephone deception cases but not money laundering in general.  In HKSAR v Li Kin Keung CACC 7/2012, the Court of Appeal in paragraph 30 of the judgment had this to say:

“In dealing with the section 27(2)(c) limb of prevalence it is first necessary to identify what it is that is said to be prevalent. As a matter of statutory construction, ‘prevalence’ must refer not to an offence in its generic form such as ‘theft’ but to the specific form of theft, which is said to be prevalent. Here that form is not theft of road signs, manhole covers or other forms of metal but theft of earth electric wires from buildings. The data regarding theft of all kinds of metals is simply irrelevant to the decision the judge had to make in this case.”

18.  In my view, what is to be deterred in the application for enhancement is telephone deception cases, in particular, the drop-off category.  Information relating to money-laundering in general is irrelevant and unnecessary in considering application for enhancement of sentence in this case. 

19.  On the other hand, I notice the overall number of telephone deception cases appears to have reached a plateau.  However, the overall number remains unacceptably high and number of detected cases is still rising.  I am of the view that the number of telephone deception cases remains so high that the crime cannot be tolerated.

20.  With respect to my learned brother judge in DCCC 749/2014, I hold a view different from him.  In my judgment, telephone deception and related money-laundering activities are still prevalent crimes in Hong Kong. 

21.  Police record also proves that the majority of victims in telephone deception cases tend to be more senior members of our community and retired persons.  The Court of Appeal in HKSAR v Hung Yung Chun CACC 453 of 2009 endorsed the following comments made by Deputy District Judge J Chan as he then was in HKSAR v Yang Cheng Lin DCCC 494/2009 Unreported:

“18. ...compared to street deception, victims of phone deceptions believed that their children were being detained, so that they, like victims in kidnapping cases, were under far greater fear and stress than those in street deception cases. Of course, in terms of monetary loss, just as in street deception cases, if the swindlers in phone deception cases were successful with their scam, the victims would lose all or most of their life savings. Therefore, the court is of the view in a phone deception case where the facts are such as those in the present case, the sentence imposed should be higher than that in a common street deception case.”

22.  With respect, I share the same view.  A slight decrease in the total loss in this kind of offence in 2014 is not evidence that the offences are no longer causing great harm to the community. 

23.  Both telephone deception and money laundering are specified offences.  I am satisfied beyond reasonable doubt that telephone deception associated with money-laundering activities are still prevalent crimes in Hong Kong and causing very great harm to our community by their recent occurrences.  The offences still need to be deterred by enhanced sentences.  I therefore grant the prosecution’s application for enhancement of sentence.

24.  The defendant is aged 32.  He is a visitor from the mainland.  He has no criminal record in Hong Kong. 

25.  In mitigation for the defendant, Mr Yip informs the court that the defendant is married, living with his parents, wife and two children in the mainland, working as a construction worker.  Earning RMB5,000 yuan a month, he was the sole breadwinner of his family. 

26.  Referring me to three Court of Appeal cases and two District Court Reasons for Sentence¹, Mr Yip submits that the usual starting point for this type of offence is 2½ years to 3 years’ imprisonment.  He asks the court to take a starting point lower than 3 years.

27.  Money laundering is a serious offence. Sentences should generally reflect the amount of black money.  It is also relevant to consider the degree of participation by the defendant, whether the offence was organised and sophisticated, and whether it involved an international element (See HKSAR v Boma Amaso).

28.  In this case, the defendant was the legman in a telephone deception case.  The evidence cannot prove that he was a party in the deception case.  However, in the circumstances of the case, while he might not know the exact details of the deception, he ought to have known the illicit source of the money he was collecting. 

29.  I do not find the two Reasons for Sentence referred to by Mr Yip helpful as they were decided on the specific facts and background of the defendants in the two cases. 

30.  In HKSAR v Wu Jianbing, a case referred to by Mr Yip, the Court of Appeal indicated that a person committing this crime of offence in those circumstances can expect a starting point of 3 years’ imprisonment even with a clear record.  In HKSAR v Cen Huakuo CACC 21/2014 and HKSAR v Lin Zhongyue CACC 141/2014, the Court of Appeal adopted similar approach in this kind of legman case. 

31.  In this case, the ransom amount asked for was $120,000.  It is a very significant sum of money, if not the whole life savings of the 79-year-old victim.  There was also a cross-border dimension.

32.  Having considered all the circumstances in this case and the mitigation made on behalf of the defendant, I am of the view that the appropriate starting point for the present case is 3 years’ imprisonment.  The defendant will have one-third reduction for his plea of guilty.  There is no other effective mitigating factor in this case.  The fact that he has a clear record in Hong Kong carries little weight. 

33.  I am satisfied that the drop-off-type telephone deception cases and the associated money-laundering activities are specified offences and prevalent crimes in Hong Kong and that they are causing great harm to the community by their recent occurrences.  The requirement and necessity for enhancement of the sentence is proved.  I will adopt the proportion of enhancement set out in the aforesaid Court of Appeal cases by one-third, ie 8 months. 

34.  The final sentence is therefore 2 years and 8 months’ imprisonment.

1.- HKSAR v Boma [2012] 2 HKLRD 33

- Secretary for Justice v Wan Kwok Keung [2012] 1 HKLRD 201

- HKSAR v Wu Jianbing CACC32/2011

- 香港特別行政區 訴 鄭榮軍 DCCC246/2013

- HKSAR v Rong Jianming DCCC1133/2013