HKSAR v. MAZHAR TAHA AHMED ELMANSOURI

CACC 165/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 165 OF 2012

(ON APPEAL FROM DCCC NO. 1309 OF 2011)

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J U D G M E N T

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Hon Fok JA (giving the Judgment of the Court):

Introduction

1. On 25 April 2012, the applicant was convicted after trial before His Honour Judge Browne (the Trial Judge) of one count of using a false instrument, contrary to s.73 of the Crimes Ordinance (Cap. 200), and sentenced to 5 years’ imprisonment.

2. The applicant filed an application for leave to appeal against conviction and sentence on 7 May 2012.  His application for legal aid was refused on the merits on 6 August 2012 and two re-applications for legal aid were similarly refused.  He therefore appeared in person before Chu JA when his application came on for hearing on 29 January 2013.

3. On that date, Chu JA dismissed his application for leave to appeal against conviction but granted his application for leave to appeal against sentence.  The applicant has, since then, been granted legal aid for his latter application and was represented before us by counsel, Mr Giles Surman, but he appears in person on his renewed application for leave to appeal against conviction.

4. In addition to that renewed application, in which he represented himself, the applicant also made applications, by notices of motion dated 15 and 29 August 2013 and 12 September 2013 respectively, for leave to adduce fresh evidence pursuant to s. 83V of the Criminal Procedure Ordinance (Cap. 221).

The charge

5. The particulars of the offence of which the applicant was convicted were that, on 28 April 2010, he together with Xiao Chufan (Xiao) used a bank draft dated 18 April 2010 in the sum of US$4 million payable to Dolibat Developement Company Limited, which was and which he knew or believed to be false, with the intention of inducing the staff of the Bank of Communications Company Ltd to accept it as genuine and, by reason of so accepting it, to do or not to do some act to her own or any other person’s prejudice.

The facts

6. The applicant, an Egyptian national, and Xiao, a resident of the Mainland, are the sole shareholders of a company incorporated in Hong Kong on 19 November 2008 as DOT.BNS High Tech HK Company Limited.  The name of that company was changed on 7 January 2010 to Dolibat Development Company Limited (Dolibat) and further changed on 6 May 2010 to Dolibat Developement Company Limited (Dolibat Developement).

7. The applicant and Xiao are also joint shareholders of three other companies incorporated in Hong Kong.  The company secretary of those four companies is HK Xing Hong Registrations Ltd (Xing Hong).  The four companies owned by the applicant and Xiao, together with Xing Hong, have the same registered address at Flat/Room B, 8/F Chong Ming Building, 72 Cheung Sha Wan Road, Kowloon.

8. It is common ground that on 28 April 2010, the applicant and Xiao went to the Central Branch of the Bank of Communications (BOC) where they presented themselves as husband and wife and asked to open an account in the name of Dolibat.  They produced a Business Registration Certificate of Dolibat and Certificate of Change of Name showing the name change of the company on 7 January 2010.

9. On that occasion, the applicant presented the bank draft particularised in the charge (exhibit P2) for payment into the account to be opened.  P2 purported to be issued by the Dubai Branch of Samba Financial Group (Samba) and was payable to “Dolibat Developement Company Limited”.  Later that afternoon, the bank manager (PW1) contacted Xiao to inform her that P2 could not be processed because the word “Developement” in the name of the payee was misspelt with an extra “e” after the letter “p”.

10. On 11 May 2010, the applicant and Xiao went to the Wong Tai Sin Branch of BOC and produced a Companies Registry document showing that the name of the company had been changed from Dolibat to Dolibat Developement.  They asked for 12 accounts to be opened, four in the name of the applicant, four in the name of Xiao and four in the name of Dolibat Developement, into one of which the proceeds of P2 were to be deposited.  At that time, however, the only deposit made into the 12 accounts was one of HK$500 in an account of Dolibat Developement.

11. On 19 May 2010, the applicant and Xiao returned to BOC in Wong Tai Sin and chopped the name of Dolibat Developement on the reverse of P2.

12. On 20 May 2010, BOC sought confirmation of P2 from Samba, who subsequently informed BOC that P2 was not genuine and that the original draft had been returned to it for cancellation by its customer, Mr Mohamed Assad Said (Said), between 13 and 26 May 2010.

13. The applicant was arrested on 26 June 2011, when he was entering Hong Kong from Macau.

The prosecution case

14. It was the prosecution case that P2 was a forgery and that the applicant knew or believed it to be false.

15. As to the latter issue of knowledge or belief, it was the prosecution case that this was a matter to be inferred from the above facts and the nature of P2 as a forged instrument.

16. As to the status of P2 as a forgery, the head of internal financial control of Samba (PW12) gave evidence and produced a genuine bank draft (P12) dated 18 April 2010 that had been issued on the application of Samba’s customer, Said, in the amount of US$4 million.  The spelling mistake in relation to the word “Developement” was present in P12 and PW12 testified that the mistake originated from Samba, but was not discovered until sometime in mid- to late-May 2010.  P12 was delivered to a person called Ahmed Mahmoud Elehemily (Ahmed), who was authorised by Said to collect it. When he collected it, Ahmed signed on a carbon copy of P12 (P23), which the bank retained, to acknowledge receipt.  On the reverse of P23, there was a box for “Payee’s endorsement” to enable the beneficiary to further endorse the draft.  In the original draft, this box was left blank.

17. The draft was to be paid by Citibank, through whom it was routed for clearance at that bank in New Castle, Delaware.  Had it been presented for payment by the beneficiary, Dolibat, Citibank would have notified Samba and then debited Samba’s account with it and credited Dolibat’s bank.  On being notified by Citibank, Samba would have contacted Said to authorise payment.

18. PW12 also gave evidence that, on 13 May 2010, Samba received notice of a forgery attempt in relation to P12 in Lebanon and communicated this to Said on the same day.  Sometime between 13 and 26 May 2010, Said returned P12, the original draft, to Samba.  Said also wrote a letter dated 8 May 2010 to request the cancellation of P12.  This request was approved and signature on the draft was cut out and it was marked “liquidated 26 May 2010”.  The money debited from Said’s account was re-credited to it.

19. PW12 was shown P2 and confirmed it to be a forgery by reason to a number of factors including: its size being smaller than the original; the absence of the word “Citi” marked repeatedly through the original; the absence of the contact information for Citibank and the space for the payee’s endorsement present in the original; the absence of the chained watermark present in the original but the presence at the top of P2 of a metallic line or thread and a vertical watermark neither of which were present in the original; the quality of the paper of P2; the presence of some lettering and a signature on P2 in green ink, which was not used by Samba.

20. In relation to the registered address of the applicant’s and Xiao’s companies, PW8 gave evidence that, since 21 March 2007, he rented Room B, 8/F Chong Ming Building, 72 Cheung Sha Wan Road and lived there together with his family.  This was not a company address and he had not consented to its use as such.  PW8 was unrelated to and did not know the applicant or his companies.  It was the prosecution’s case, on the basis of this evidence, that the companies’ registered address was a false address.

The defence case

21. The applicant was interviewed under caution after his arrest and it was not disputed that his video-recorded interview (P1) was voluntary.  In this interview, the applicant claimed he had entered into a business contract with Said’s company for which P2 was issued as payment.  He said that the draft was handed to him in person in Hong Kong by Ahmed, the financial manager of Said’s company.

22. At trial, the applicant gave evidence in his defence but called no other witness.  He testified as to his personal background and commercial experience.  He said he met his current wife in Hong Kong in 2008 and started to invest in a number of businesses in Shenzhen, setting up four companies, one of which was DOTS.BNS High Tech HK Co. Limited. The registration of the companies was done through an agent in Shenzhen.  Xing Hong was his Hong Kong agent responsible for handling correspondence in Hong Kong and forwarding this to his Shenzhen agent.

23. The applicant testified that he had an agent in Saudi Arabia called Emad who knew a person called Yousseif, who was the managing director of the SABB Bank in Saudi Arabia.  At the beginning of 2010, through Yousseif he came to know Said, who was a substantial businessman.  Following negotiations between Emad, Yousseif and Said, Dolibat and Said entered into a contract for the sale of electronic gates and accessories (D6).  P2 was the payment for the contract.  The applicant said P2 was sent to him by Yousseif two to three days before 29 April 2010, on which date he met Ahmed in Hong Kong.  In support of this, the applicant produced a DHL airwaybill dated 21 April 2010 (D7) in respect of “urgent documents” sent to an address in Zhuhai, which the applicant said was his wife’s address.  He claimed the answer in his video-recorded interview that he received the draft from Ahmed in person was a mistake in translation.

24. The applicant testified that PW1 called on 28 April 2010 about the discrepancy in the spelling of the name on the draft and asked them to return to the bank the next day.  When they did so on 29 April 2010, PW1 suggested they could either change the name of the company or get a new draft.  The applicant said he discussed the matter with Ahmed who said it would take a long time to obtain a new draft and, if the goods were not delivered quickly, the contract would be cancelled.  After discussing the matter with his agent in Shenzhen, he decided to change the company’s name as this would be quicker.

25. Accordingly, the applicant returned to the bank on 11 May 2010 after Dolibat’s name was changed to Dolibat Developement. However, the applicant said he later received a letter dated 7 June 2010 from Said (D9) cancelling the contract due to “change in design”.  He said that because the bank draft was not honoured, he did not obtain the goods from his manufacturers.  His evidence was that, after this deal fell through, he continued to have business dealings with Said and entered into another contract for the sale of LED screens for US$5 million.  He said that, in September 2010, he travelled to Saudi Arabia to meet Ahmed and Yousseif and concluded this contract (D10), which he produced, but the deal did not go through.

Renewal of application for leave to appeal against conviction

26. The Trial Judge accepted the evidence of PW1 and PW12 and concluded that P2 was a forgery.  He found the applicant to be a “glib and resourceful liar” and did not believe his evidence as to how he came by the draft.  He considered that the applicant produced documents to create a misleading impression that he was a businessman of substance.  He took into account the applicant’s unusual step of changing the name of Dolibat to Dolibat Developement in order to get around the difference between the name of his company and the name of the payee of the draft.  He also took into account the material discrepancy between the applicant’s account in his video-recorded interview of how he came by the draft and that given in his oral evidence and rejected the explanation that this was a misunderstanding or mistranslation. Further, the applicant’s evidence of his dealings with PW1 was very different to the case put to her in cross-examination.  Accordingly, the Trial Judge concluded that the applicant knew that P2 was a false instrument when he presented it to BOC and that he did so intending to induce the staff of the bank to accept it as genuine and by so doing, to act to the prejudice of the bank.

27. As Chu JA noted in her judgment (at §24), the applicant wrote a number of letters to the court and adopted the contents of various letters written by his wife.  The grounds of appeal sought to be advanced were summarised as follows, namely that (1) the Trial Judge was wrong in his evaluation of the applicant’s evidence and credibility as to how he came to be in possession of P2; (2) there was an abuse of process by the prosecution and there should have been a permanent stay of the prosecution; (3) there were reasonable doubts in the case; (4) PW12’s evidence that P2 was a forgery was hearsay evidence and should have been rejected; and (5) the Trial Judge failed to give adequate reasons for the conviction and it was not proved the applicant knew P2 was a forgery.

28. We have reviewed the various grounds of appeal sought to be advanced by the applicant against his conviction.  These five grounds were each separately considered by Chu JA and rejected in her full and carefully reasoned judgment of 31 May 2013 at paragraphs 25 to 33, with which we are in complete agreement and which we respectfully adopt, likewise rejecting those grounds of appeal.

29. Subject to one point, to which we shall return below after considering the application to adduce new evidence, we would not grant leave to appeal on the renewed application for leave to appeal against conviction on the grounds of appeal advanced by the applicant.

Application to adduce new evidence

30. The applicant filed three notices of motion respectively dated 15 and 29 August 2013 and 12 September 2013 seeking leave to adduce fresh evidence pursuant to s. 83V of the Criminal Procedure Ordinance.  Under that section, the conditions to be satisfied before the Court of Appeal will exercise its discretion to receive fresh evidence are that: (i) the fresh evidence was likely to be credible; (ii) it would have been admissible in the courts below; (iii) it was relevant to an issue in the appeal; (iv) there was a reasonable explanation for the failure to adduce it in the courts below; and (v) the court is satisfied it would afford a ground of appeal.[1]

31. The applicant’s affirmations in support of the notices of motion to adduce fresh evidence do not explicitly identify the fresh evidence sought to be adduced or the basis on which it is said the conditions of s. 83V are satisfied in respect of that evidence.  Some of the exhibits to the applicant’s affirmations are clearly documents that were available below and, in some cases, adduced in evidence at the trial.  In his submissions in the hearing before us, the applicant therefore identified and addressed the various items of fresh evidence which he was seeking to adduce in support of his appeal.  To these we now turn.

32. The first document was a certificate from a legal consultant in Saudi Arabia purporting to certify the existence of a genuine commercial agreement between Said’s company and Dolibat and the fact that the draft was delivered to the applicant by DHL.  This was accompanied by a witness statement of the agent Emad, stating that he saw the draft being placed in a DHL envelope by the Saudi Arabic British Bank in Riyadh to be sent to the applicant.  He also stated that he contacted Samba after the applicant called to inquire about the draft in May 2010 and was told that Said had cancelled the contract with Dolibat and the draft and that, on behalf of Said’s company, Ahmed apologised for the cancellation of the draft.

33. Leaving aside questions as to their reliability, neither of these documents is admissible in evidence since the statements in them sought to be relied upon are hearsay statements.  That being the case, there is no basis for admitting these documents pursuant to s. 83V.

34. The next document the applicant sought to admit as fresh evidence is a message dated 3 May 2010 from Samba to Citibank in New York apparently to notify the latter of the fact that an amount of US$4 million was reserved to meet the draft in favour of Dolibat.

35. This document was served on the applicant’s legal advisers at trial as unused prosecution material and was part of exhibit P25, to which the Trial Judge referred in his Reasons for Verdict (at §49).  In the circumstances, the applicant would appear to have had the opportunity to adduce this document in evidence at trial.  There being no good explanation for the failure to do so, there is no basis for admitting this document pursuant to s. 83V.

36. The third category of fresh evidence was an e-mail from the police in Hong Kong to PW12 dated 4 October 2011 in which a detective inspector wrote asking PW12 for clarification of certain matters in his witness statement (which was dated 22 September 2011).  This led to a further witness statement of PW12 dated 14 December 2011, which was served on the applicant.  The applicant claimed that he was only provided with the first page of the e-mail but not any further pages.  At the hearing, the respondent therefore produced a full copy of that e-mail which consisted of three pages in total and also an earlier e-mail exchange of 25 and 26 September 2011.  The particular points about which the detective inspector was seeking clarification from PW12 begin at the bottom of the first page of the 4 October 2011 e-mail and continue on the second page.

37. We were informed by counsel for the respondent that the e-mail was not served on the applicant because it was part of the investigation process but there was no information available as to whether a decision was made not to disclose it, whether by the Department of Justice or by counsel prosecuting the case on fiat.

38. In our view, the better practice would have been for the prosecution to disclose the e-mail exchange between the police and PW12, including in particular the e-mail dated 4 October 2011.  However, having considered the substance of the points on which clarification was sought and the content of the further witness statement made by PW12, we are satisfied that there was no prejudice to the applicant in the omission to disclose this material since no point of substance, either favourable to the applicant or by way of discrediting the prosecution case, could have been made of it.  We do not therefore consider that the further evidence would provide a ground of appeal and we would not admit it pursuant to s. 83V.

39. The fourth category of documents sought to be admitted as fresh evidence was a letter from the Complaints Against Police Office (CAPO) dated 27 August 2013 concerning a complaint lodged by the applicant on 10 June 2013 regarding the failure to disclose the e-mail to PW12 dated 4 October 2011 and the manner in which the further witness statement of PW12 was prepared.  There is also a letter from the police to the Consulate General of Egypt dated 23 August 2013 regarding an intended complaint by the applicant against “a bank in United Arab Emirates” and inquiring as to the proper procedures for the police to obtain an official statement from bank staff in Dubai and whether the police has the right to contact bank staff directly or has to go through certain diplomatic channels.

40. These new documents are not, in our view, relevant to any issue in the proposed appeal.  Although the applicant complained that PW12 had given dishonest testimony against him and that this was not discovered due to shortcomings in the police investigation, we are satisfied that the further evidence sought to be adduced would not provide a ground of appeal since they are not probative of the matters of which the applicant complains.  There is, in short, nothing to suggest that the Trial Judge was wrong to accept PW12’s evidence as truthful.  Accordingly, we would not exercise our discretion to admit these documents under s. 83V.

41. The fifth category of further evidence consists of a statement made to the applicant in prison by the police, and recorded by him in a statement dated 19 June 2013, to the effect that police inquiries led them to visit the registered address of the four companies owned by the applicant and Xiao, namely Flat/Room B, 8/F Chong Ming Building, 72 Cheung Sha Wan Road, Kowloon.  This visit confirmed the existence of the address and the police recorded that Ms Kam, the landlord and person-in-charge of Xing Hong confirmed that the four companies were registered by that company.

42. It was an admitted fact that the four companies each had their registered address at Flat/Room B, 8/F Chong Ming Building, 72 Cheung Sha Wan Road, Kowloon.  It was also an admitted fact that Xing Hong was the corporate secretary of those companies.  In his Reasons for Verdict, the Trial Judge referred to PW8’s evidence that a “Mme Kam Yung is the landlady” and that she told him to take letters not addressed to him to the management company.

43. Given those admitted facts and that state of the evidence at trial, we do not think that the further evidence sought to be admitted gives rise to a ground of appeal since the facts which it supports are already in evidence.  Insofar as the applicant’s complaint is that Ms Kam was not called as a witness, the applicant’s legal representatives at trial were clearly aware of her existence and the decision not to call her to give evidence must be taken to have been deliberate.  For these reasons, we do not think this further evidence satisfies the conditions of s. 83V. We shall, however, return in a moment to the question of the “false address”.

44. The sixth and last item of further evidence identified by the applicant in the course of his submissions to the court is a letter dated 8 May 2010 from Said to Samba requesting the latter to cancel the draft and return the US$4 million to his company’s account.  The applicant contended that this was inconsistent with PW12’s evidence which was that the cancellation of the draft was on a later date and that this went to undermine the credibility of PW12’s evidence.

45. This item of evidence is not new.  It is in fact exhibit P20 to which the Trial Judge referred in his Reasons for Verdict (at §37). It therefore does not satisfy the conditions of s. 83V.

46. For the above reasons, we dismiss the applicant’s three notices of motion applying for leave to adduce fresh evidence.

The “false address” point

47. As already mentioned, the prosecution opened its case on the basis of, amongst other matters, the contention that the address of Dolibat at Flat/Room B, 8/F Chong Ming Building, 72 Cheung Sha Wan Road, Kowloon was “false”.  This was also the basis on which the prosecution made its closing submissions.

48. This contention was reflected in the Trial Judge’s Reasons for Verdict (at §2) where it is recorded that the registered address of Dolibat “was later found to be false”.  In addressing the defence evidence, the Trial Judge noted (at §§72 & 73) that the registered address of the four companies of which the applicant and Xiao were directors and shareholders and of Xing Hong was “the same false address”.

49. In the Trial Judge’s evaluation of the evidence in the Reasons for Verdict (at §125), he said:

“The registered address of Dolibat was false. It was the residential address of PW8 who had no connection with the company. He had lived at the address with his wife and 5 children for 5 years. The same false address was registered for all four Hong Kong companies owned by the defendant and Xiao.”

50. In the section of the Reasons for Verdict addressing the applicant’s knowledge of the forgery of P2, the Trial Judge said (at §163):

“I took into account that Dolibat and the other three Hong Kong companies of which the defendant and Xiao were equal shareholders and directors all used the same false registered address. I took into account that Xing Hong, the corporate secretary of the four registered companies (Admitted Fact 10) was also registered at that same false address.”

51. We have been troubled by these references to the false address of Dolibat and the other companies.  The admitted facts included the fact that the registered address of those companies was at Flat/Room B, 8/F Chong Ming Building, 72 Cheung Sha Wan Road, Kowloon.  That is an actual address, as PW8 testified, since he was living there with his family and received mail addressed to companies there from time to time which he had been directed to pass to the management office.  It was therefore not a false address and the bare assertion of the prosecution that it was should not have been accepted.

52. We are satisfied that this mistake is an irregularity in the Trial Judge’s reasoning since it was a factor he took into account in rejecting the applicant’s credibility and in determining his state of mind when committing the offence.  This was in the face of a submission by counsel for the defence in his closing that the address had “no possible relevance to the state of mind of the Defendant on 28^th April 2010”.

53. On the other hand, although the Trial Judge did not explain the basis for his accepting the prosecution’s assertion that the address was false, we are satisfied that the Trial Judge could have characterised the registered address as being questionable, not because it was a false address, but because it was a residential address of a person wholly unconnected to the applicant and was therefore merely an address of convenience which was not a business address.

54. Moreover, given the overwhelming evidence from which the Trial Judge would have been entitled to infer guilty knowledge on the part of the applicant concerning the status of P2 as a forgery, in particular the change of Dolibat’s name to Dolibat Developement and the inherently incredible story that PW1 suggested this as an option to resolve the discrepancy in the name on P2, we are sure that inevitably the Trial Judge would have convicted the applicant of the charge.  Accordingly, we are satisfied that no miscarriage of justice has actually occurred by reason of the false address point.  This is because the false address point (at §163) was a relatively minor point relied on by the Trial Judge at the very end of his analysis in the Reasons for Verdict on the issue of knowledge of the forgery (from §153 to §162).  Also, as we have already stated, the point could have been put in terms of the address, whilst not being false, being questionable.

Conclusion on renewed application for leave to appeal against conviction

55. Therefore, whilst we would grant leave to appeal against conviction on the ground that the false address point was an erroneous element in the Trial Judge’s reasoning, we would apply the proviso to s. 83(1) of the Criminal Procedure Ordinance and dismiss the appeal.

Appeal against sentence

56. Upon conviction of the applicant for the offence, the Trial Judge imposed a sentence of 5 years’ imprisonment.  In his Reasons for Sentence, having noted the facts relevant to the applicant, the Trial Judge said:

“15. … this court remains ignorant of the true circumstances in which the defendant came by this draft. There is obviously an international dimension to this case. Not only does it involve a middle-Eastern bank; there were foreign nationals involved.

16. In connection with the draft itself there was a genuine draft issued by the Samba Bank. Clearly, what drew attention to this draft was the misspelling of the word ‘Development’, which was a mistake made by the Samba Bank.

17. The instrument used was a banker’s draft, and this was an attempted fraud on the bank. I found the defendant to be a glib and resourceful liar. He is a confidence trickster. Had this been a case which involved a breach of trust for cases involving sums in excess of 15 million, the appropriate sentence is in excess of 10 years.

18. Counsel has pointed out this is not a breach of trust case and there is no tariff for this particular case. But, in my view, given the significant aggravating features which were present in this case, a substantial sentence of imprisonment is called for.

19. Having considered all the circumstances of the offence I have decided to impose a sentence of 5 years’ imprisonment.”

57. The maximum sentence upon a conviction for using a false instrument under s. 73 of the Crimes Ordinance is 14 years’ imprisonment.  There is no tariff for sentences under this provision since there are myriad ways the offence may be committed and the appropriate sentence in each case must depend on the particular facts of each individual case.

The grounds of appeal against sentence

58. The perfected grounds of appeal against sentence set out four grounds of appeal, namely that (1) the Trial Judge erred in giving insufficient consideration to the lack of sophistication of the applicant’s modus operandi; (2) the Trial Judge attached excessive weight to the sum of money involved; (3) the Trial Judge attached excessive weight to the international dimension of the offence; and (4) the sentence of 5 years’ imprisonment was manifestly excessive, especially in light of the authorities.

59. Although these grounds were separately addressed in the skeleton submissions in support of the appeal, in Mr Surman’s oral submissions, he rightly focused on an analysis of various authorities in support of the ground of appeal that the sentence was manifestly excessive. This was a sensible course since it cannot be in doubt that the sum of money involved and the international element in the offence are relevant factors for a judge to take into account in determining the appropriate sentence on a conviction under s. 73 of the Crimes Ordinance. Similarly, the modus operandi of a crime is generally a matter to be taken into account, so the gravamen of the appeal in the present case is essentially that the sentence imposed was manifestly excessive in all the circumstances.

The submissions in support of the appeal against sentence

60. The first point that Mr Surman sought to emphasise in his submissions were that the modus operandi of the offence in the present case was rudimentary and, from the beginning, unlikely to succeed.  He referred to the fact that the name of the payee of the false instrument presented, Dolibat Developement, did not even match the name of the applicant’s company, Dolibat, so that there was no likelihood of the presentation being accepted.  He described the change of name of the company from Dolibat to Dolibat Developement in an attempt to have the false draft accepted as “similarly inept” given the obvious difficulties of such a course identified by the Trial Judge.  He submitted that the false draft was noticeably a poor quality forgery and stressed that the only other conspirator was Xiao.  Thus, he described the offence as “a simple, quick and ineffectual ‘one-off’ attempt at fraud”, such that the risk of loss to the bank and danger of damage to the integrity of the banking system of Hong Kong was “slight” since from the outset it was very probable that the BOC would have noticed that the draft was not authentic and made inquiries of the issuing bank.  This is in fact what happened and no money was paid out to the applicant.

61. Mr Surman also submitted that, given the rudimentary attempt at cashing the false draft, the Trial Judge should not have placed the weight he did on the amount of the draft and treated it as an aggravating factor.  He again emphasised what he described as the amateurish nature of the applicant’s attempt and submitted that the prospects of the bank paying out were slim, such that “[i]t could almost be said that the plan was doomed from its inception.”  Ultimately, the bank discovered the falsity of the draft and no money was transferred.  Mr Surman referred, in this context, to the case of HKSAR v Lim Ban Hoong, unrep., CACC 465/2007 (16 July 2009) which was an attempt to defraud a bank of the extremely large amount of US$108 billion plus interest of 8% per annum and where the sentence imposed was 39 months’ imprisonment.

62. Mr Surman similarly submitted that the Trial Judge had placed excessive weight on the international dimension since international transfers of money between banks are a matter of course even in routine banking transactions.  He also submitted that the involvement of foreign nationals in the attempted fraud was “distant and indirect”.  He relied on HKSAR v Leo Yee Sang Patrick, unrep., CACC 494/2004 (28 July 2005) at §26 where it was held that “there is no valid distinction to be made between ‘local’ LC fraud and ‘international’ LC fraud” as both could lead to a worldwide loss of confidence in Hong Kong’s banking system.

63. As already noted, the gravamen of the submissions in support of the appeal was that the sentence was manifestly excessive in the light of the authorities.  Counsel noted that the Trial Judge did not consider other similar cases and that, compared to analogous cases, the sentence was manifestly excessive.  Those cases, which Mr Surman addressed in his oral submissions and to some of which we shall return below, were HKSAR v Anofi Hamid Tunde, unrep., CACC 248/2000 (8 September 2000), Lim Ban Hoong (supra), HKSAR v Tarazona Edgar Henry and Another, unrep., CACC 346/2003 (8 April 2004), HKSAR v Song Chang Moo, unrep., CACC 235/2010 (4 July 2011), HKSAR v Dai Chi Wai [2011] 4 HKLRD 534, HKSAR v Tse Ching Ng and Others, unrep., CACC 361/2004 (6 September 2005), Leo Yee Sang Patrick (supra) and HKSAR v Hui Po Keung and Another, unrep., CACC 240/2011 (29 November 2012).  In the light of those authorities, it was submitted that the Trial Judge in the present case should have taken a starting point of 3 to 3½ years’ imprisonment, which would already take into account the sum of money involved, the risk to which the bank was put and the fact the applicant and Xiao came to Hong Kong as visitors.

A consideration of the submissions

64. We are not persuaded by Mr Surman’s submission that the applicant’s modus operandi in committing the offence was simple and unsophisticated and that his attempt to obtain the proceeds of the false instrument was, in effect, doomed to failure from the outset.

65. On the contrary, this was a crime which involved careful planning and the taking of a number of calculated steps before the presentation of the false draft on 28 April 2010.  It would have involved the applicant obtaining information that Said had business dealings with a company called “Dolibat Development Company Limited”.  The applicant then took the step, as early as 7 January 2010, of changing the name of the applicant’s company “DOT.BNS High Tech HK Company Limited” to match that company’s name.  He must then have obtained information that Said had arranged for the issue of a bank draft in the sum of US$4 million by Samba in favour of Dolibat in early April 2010 and that the genuine draft had in fact been issued to Said but not used by him.  This must have involved the applicant obtaining information as to the appearance of the genuine draft, thus leading to the copying on the false draft of the spelling mistake in the original draft of the word “Developement”, and the manufacture or procurement of the false instrument containing material entries, as to the names of the drawer and drawee and the amount, which were the same as on the genuine draft.  Finally, the scheme involved the applicant and Xiao coming to Hong Kong to open bank accounts in the name of Dolibat and to present the draft for payment of the US$4 million.

66. In short, we do not accept that this was a fraudulent scheme that was as simple and rudimentary as submitted.  On the contrary, we agree with the respondent’s submission that the scheme involved careful and meticulous planning and preparation on the part of the applicant. Although doubtless he would have had to be assisted by others, the applicant was a principal, if not the principal, player in this scheme.  He and Xiao were the only shareholders and directors of Dolibat.  In addition, when the scheme was initially stymied by the mistake in the spelling of “Developement” in the name of the payee of the draft, the applicant then took an additional calculated step to change the name of Dolibat to Dolibat Developement in order to achieve the success of the fraud.

67. Thus, given the existence of the genuine bank draft, when the BOC checked with Samba, as was to be expected, the bank in Hong Kong might well have been informed that there was such a draft so that payment could be made on it.  Had it not been for Samba contacting Said about the draft, which was fortuitous, the fraud might well have succeeded.  We therefore do not agree that the chances of the fraud succeeding were as meagre as the applicant would have us accept.  In our view, and contrary to Mr Surman’s submission which was to the opposite effect, this case, like HKSAR v Chu Wai San [2008] 4 HKLRD 18, was “not some slight, opportunistic scheme which was adopted and put into play; to the contrary it was planned and systematically executed”: see ibid at §189.

68. Nor do we accept that the international element in the present case was distant and indirect.  The scheme involved two non-Hong Kong residents coming to Hong Kong to open bank accounts with a bank in Hong Kong, presenting an Egyptian passport and a two-way permit respectively, and using a Hong Kong company which had no other genuine business to do so, in order to deposit a bank draft drawn by a Middle Eastern bank on a bank in the United States of America for a sum of US$4 million.  This was clearly a case of a foreigner coming to Hong Kong to commit a crime.  In the recent case of HKSAR v Aguilar Garcia Milner Javier, unrep., CACC 485/2012 (11 June 2013), Lunn JA held (at §19) that “[t]he fact that the applicant was a visitor to Hong Kong was a factor to which the judge was entitled to have regard, as being in aggravation of the commission of the offence” and also that a finding that a defendant has come to Hong Kong in order to commit the specific offence (which was not the case in Aguilar Garcia Milner Javier) is a “much more serious element of that factor of aggravation”.

69. As to the amount of the draft, there can be no doubt that this is a relevant factor for a judge determining the appropriate sentence for this offence and Mr Surman accepted this.  However, he submitted that, when one examined the cases to which he referred, frauds involving potentially much greater amounts did not attract higher sentences than that imposed here.  Indeed, the sentences in those cases were generally much lower. He referred to the sentence of 39 months imposed in HKSAR v Lim Ban Hoong involving an attempt to defraud a bank of over US$108 billion and the sentence of 3 years imposed in HKSAR v Anofi Hamid Tunde, a case involving the same offence as that charged in this case and a similar modus operandi but where the amount of the false instrument was HK$450,000, in order to support the submission that the amount of money in cases involving false instruments does not appear to be a factor of much weight.

70. We do not propose to address each of the various authorities relied upon by Mr Surman in support of the submission that the sentence was manifestly excessive.  As has often been said before, the citation of individual cases for the purposes of comparing sentences is of limited assistance since the particular sentence in any one case must depend on the individual facts of that case.

71. There is nothing in the Reasons for Sentence to indicate whether the Trial Judge was referred to or considered any of the authorities which were cited in this appeal.  When leave to appeal was granted, Chu JA referred to the case of HKSAR v Ng Jit Man, unrep., CACC 137/2005 (3 July 2006), in which the defendant was convicted at trial of three charges of using a copy of a false instrument and two charges of using a false instrument.  These false documents were used to open accounts and secure financial advantages from three banks over a course of two years.  No actual loss was suffered by the banks.  The total sentence, which the court considered appropriate, was 4½ years’ imprisonment.  Chu JA rightly, in our view, considered that, in light of the sentence in Ng Jit Man for conviction on a number of separate charges, it was arguable that the sentence of 5 years’ imprisonment in the present case on conviction for one charge was manifestly excessive.

72. Amongst the cases cited in argument, the case of Anofi Hamid Tunde bears the closest factual similarities to the present case.  In that case, the applicant came to Hong Kong and used his passport to open a personal bank account in Hong Kong for the purpose of depositing a false bank draft drawn in his favour in the amount of HK$450,000.  He was charged with one count of using a false instrument (the same offence as here).  The Court of Appeal considered the sentencing judge’s starting point of 3 years neither wrong in principle nor manifestly excessive.

73. Although there are similarities between Anofi Hamid Tunde and this case, the principal differences are that here there was a greater degree of planning and preparation in the change of name of the applicant’s company to Dolibat, the opening of an account in the company name rather than a personal account, the obtaining of information of the existence and format of the genuine draft (containing the misspelling), the attempt to meet the difficulty posed by the misspelling by the further change of name of the company to Dolibat Developement and, of course, the considerably greater amount of the draft (US$4 million between approximately HK$31 million and therefore about 70 times the value of the draft in Anofi Hamid Tunde).

74. We do not consider Lim Ban Hoong to be of particular assistance.  The offence in that case was a conspiracy to defraud involving the presentation by the defendant of a false agreement and other related false documents showing that the bank had received the sum of US$108 billion from a customer in 1948.  The Court of Appeal considered the sentence of 39 months to be appropriate.  However, the facts of that case were nothing short of remarkable in that the brazen attempt to extract so large a sum of money from the bank was, in our view, most unlikely to succeed.  Although we note that the court there considered that there might be a temptation for the bank to offer settlement for a lesser sum and so rejected the submission that there was only a notional risk to the bank, the reality is that the bank would be bound to examine the documents and circumstances of the claim very closely before making any payment and therefore the chances of success were, we think, materially lower than in the present case.

75. Tarazona Edgar Henry was a case of possessing false instruments, the defendant being found to have in his hotel room documents purporting to be 750 US$500 million US Treasury Bonds printed with a picture said to be of President McKinley.  The sentence of 3 years’ imprisonment was held to be appropriate.  However, we do not think that case assists the applicant since the facts are very different: the charge did not involve the use of the instruments and, again, the vintage and sheer size of the instruments suggests they would be carefully scrutinised and the likelihood of success of a fraud involving their use would be low.

76. Similarly, the case of Song Chang Moo does not, we think, point to a manifest excess in the present sentence.  That case involved a conviction for conspiracy to use two bank drafts (one for US$2.8 million and the other for US$10 million) and a letter of confirmation.  The sentence imposed after conviction was 3 years.  However, there was no appeal against sentence so the Court of Appeal did not express any view on its appropriateness and there is no indication of whether the sentencing judge had Anofi Hamid Tunde cited to him, which might have caused him to impose a higher sentence.  Moreover, we agree with the respondent’s observation that the fraud relating to the deposit of the two false drafts was doomed to failure because of the fact that the defendant sought to deposit the drafts into a company which was not the beneficiary of the drafts and the bank to whom they were to be presented had already indicated they could not be paid because of this.

77. Dai Chi Wai was one of a number of letter of credit fraud cases cited on behalf of the applicant, which also included Leo Yee Sang Patrick and Tse Ching Ng.  We agree with the respondent’s submission that this type of case is distinguishable from the present case and that, generally, in frauds involving letters of credit, the manner of perpetrating the fraud is materially different to the present factual situation.  Furthermore, the banks may only be at risk for the outstanding amount drawn under the letter of credit at any given time and that this will not necessarily be as high as US$4 million, which was the risk in the present case.  In any event, Tse Ching Ng in particular, where the Court of Appeal substituted for a sentence of 4 years’ imprisonment one of 2½ years is an unusual case since it involved the sentence of an 80-year old man where there were what the court described as “mitigating factors of an exceptional kind”.

78. Returning to Ng Jit Man, it is true, as Chu JA observed, that there the applicant was convicted of five charges whereas the applicant here faced only one charge.  However, we observe that the circumstances of that case were very different to those of the present: the offences there essentially involved the use of false instruments to obtain a loan and the opening of securities accounts and bank accounts, and no loss was actually suffered by the banks.  On charge 1, for which the defendant received a sentence of 18 months’ imprisonment, the judge accepted that the defendant “was not to directly benefit from the use of the false documents” in charge 1 but had instead acted as he did to help a friend to obtain a bank loan.  On charges 2 and 3, for which the defendant received a sentence of 3 years’ imprisonment, the judge found that the offences had been committed by him in order to open a security account through which, if successful, he would have obtained the benefit of credit facilities.  The presentation of the false draft in that case (for US$5 million) was not done in order to cause the bank to pay over the proceeds of the draft to the defendant, which was the design of the scheme in the present case in relation to P2.  Finally, we would add that the totality of the sentence imposed in that case, 4½ years, does not lend strong support for Mr Surman’s submission that the benchmark sentence for an offence of using a false instrument is between 3 to 3½ years.

79. We have carefully considered the sentence imposed in the present case.  We agree with Mr Jonathan Man’s, Assistant Director of Public Prosecutions, description of the sentence as being “on the high side”.  However, in all the circumstances, given the serious nature of the offence, including its careful and meticulous planning, the various steps taken in preparation for the fraudulent use of the false instrument, the seriously aggravating factor of the international element of this offence, the additional attempt to get round the initial problem of the misspelling and the significantly large amount of the draft and the real risk that, if the scheme had succeeded as it very well might have, there would have been a theft of US$4 million, we are not persuaded that the sentence is manifestly excessive.

Conclusion on appeal against sentence

80. For these reasons, we dismiss the appeal against sentence.

[1] See Mahabobur Rahman v HKSAR (2010) 13 HKCFAR 20 at §13.