HKSAR v. WONG KA FAT AND OTHERS

DCCC937/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 937 OF 2008

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Reasons for Sentence

1.  The first three defendants faced three charges.  The 1st charge against the three defendants was a charge of false imprisonment.  In respect of this charge, the defendants pleaded not guilty and the prosecution invited the court to leave the charge on the court file not to be proceeded with without the leave of the court and the court accedes to that request.

2.  The 2nd charge against D1 to D3 is a charge of theft and the particulars of that offence are that on 6 July in Hong Kong together with a person unknown, they stole a shows in action, namely a debt, in the sum of HK$20,000 owed by the Hongkong & Shanghai bank to a Mr To, who is the victim in this case.

3.  The 3rd charge against the first three defendants was a charge of blackmail.  Again, it is on 6 July and it is alleged that they together with a person unknown, with a view to gain for themselves or with intent to cause loss to another, made an unwarranted demand of HK$650,000 from Hui Yin-man with menaces.

4.  The 4th charge which is a charge which has been preferred against only the 4th defendant and that is a charge of conspiring to deal with property known or believing it to represent the proceeds of an indictable offence.  The particulars of that offence are that between 9 September 2005 and 14 July 2008, the defendant conspired together with persons unknown to use a bank account with the Hongkong & Shanghai Banking Corporation and they used the account to deal with the property knowing or believing or having reasonable grounds to believe it represented the proceeds of an indictable offence.

5.  The victim in the 2nd charge is a young man, he is 23 years of age and a student of a US university.  On 5 July last year, together with a friend of his, he went to Macau for sightseeing.  Shortly after 7 o’clock in the evening, he and his friend were at a gambling table in the Casino Wynn.  Whilst there, they were approached by a man who called himself Ling and he claimed to be a casino promoter and he tried to persuade the victim to join a club for membership for free ferry tickets, hotel accommodation and sauna services.  Shortly afterwards, a second male approached who identified himself as Wah Chai and he told the victim that the Casino Wynn did not offer any promotion and suggested that they go to the Casino Lisbon.  Foolishly, the victim followed Ling and Wah Chai and his friend made the sensible choice and left.

6.  At 10 pm that night, the victim was brought to a restaurant in the Casino Lisbon where Ling obtained details about the victim and his family.  The two conspirators, Ling and Wah Chai, were joined by another man who identified himself as Simon and the three of them took PW1 to a gambling table in the Casino Lisbon.  Simon and Wah Chai claimed that the victim had to bet with the chips provided by them to be eligible for free tickets.  Simon then took out a mud chip worth $10,000 and started placing bets on behalf of the victim.  This, of course, was all part of a well-known scam that operates in Macau. 

7.  Within 15 minutes, Simon allegedly lost the whole of the $10,000, so at that stage Simon took out another $10,000 mud chip and the victim wanted to leave but he was stopped by Ling.  The victim was then in the control of the conspirators.  He wanted to go to the washroom and Ling accompanied him to the washroom.  He was then escorted back to the gambling table where Simon continued to place bets for him and within a very short period another $10,000 was allegedly lost. 

8.  The victim was brought to a restaurant where Simon recorded where Simon recorded his address, phone number, as well as the names, address and phone numbers of his family members including that of his grandmother as a reference person.  They made a photocopy of his identity card and when they demanded that he surrender his mobile phone, he refused and they snatched it from him.

9.  The victim offered to repay the $20,000 and asked to be allowed to leave but Simon refused and told him that his company would advance another $100,000 to him so that he could win back his gambling losses.  The victim was scared.  He dared not leave as there were no other patrons in the restaurant at the time and all the waiters seem to know Simon personally. 

10.  He was taken to another casino and Simon and Wah Chai continued to place bets on behalf of the victim and he kept asking to leave but was refused.  Within a few hours, another $300,000 were allegedly lost and he was taken to a restaurant and told to sign an IOU for $650,000 and the victim said he did not have the money and Simon demanded he repay by instalments of $3,000 and had to pay the first instalment immediately.  The victim withdrew $2,000 from the ATM and together with the $1,000 cash in his wallet, he passed that money to Simon.

11.  It was not until 1 o’clock the following afternoon that Ling escorted the victim back to Hong Kong by ferry.  The victim was placed next to the window so Ling could keep an eye on him.  The victim was too frightened to mention his situation to the Immigration officers because he feared that his family would be harmed.  Ling escorted the victim outside the arrival hall and there he was handed over to D1, D2 and D3.  They took the victim to a nearby restaurant in the Shun Tak Centre where they recorded his personal details and those of his family members. 

12.  The victim was then taken to another restaurant where the 2nd defendant telephoned the boss, a Mr Cheung, and passed the phone over to the victim.  Mr Cheung told the victim to pay as much as he could afford and the victim was scared and offered to pay $20,000.  He was ordered to pay it into a bank account at a nearby ATM.  The 2nd defendant scribbled a bank account number on a piece of paper and passed it to the victim.  The 2nd defendant told the 1st defendant to keep an eye on the victim while he brought the victim to the ATM and at the ATM, $20,000 was transferred into the bank account.  The 1st defendant told the victim to be co-operative and reminded him that he would not be able to get away because they had the details of his family members.  The first three defendants then escorted the victim to his home by taxi. 

13.  They arrived at the victim’s home at about 4 pm in the afternoon.  When they arrived there, his mother who is a housewife aged 52, was watching television.  D1 and D3 followed the victim into his home whilst the 2nd defendant waited outside.  D1 and D3 told the victim’s mother that the victim had lost $650,000 whilst gambling in Macau.  She asked to see their identity cards but they refused. 

14.  D3 phoned his boss and passed the phone to PW2.  Over the phone the boss identified himself as Mr Cheung and demanded that the victim’s mother pay $650,000.  His mother told Mr Cheung that she did not have so much cash and to wait until her husband returned from overseas.  Mr Cheung refused and threatened to take away the victim if his mother did not pay immediately.  Not surprisingly, the victim’s mother was very scared and asked Mr Cheung how much she needed to pay.  She was told to pay as much as she had.  She asked that Mr Cheung send away the 1st defendant and the 3rd defendant but Mr Cheung refused.  The victim’s mother offered to transfer cash of $10,000 and pay the rest later but Mr Cheung refused and threatened that D1 and D3 would stay in her home to wait for her husband.  PW2 then offered to write a cash cheque in the sum of $100,000 and after some negotiation that was agreed to provided that D1 and D3 use the family car.  The victim’s mother again told D1 and D3 to leave but they refused in a fierce tone.  As she was afraid that they would harm her son, so she told the 1st and 3rd defendant she would go to her bedroom and write out the cheque and she used the opportunity to call the police.

15.  Soon afterwards, the police arrived and the 1st and 3rd defendant were arrested.  Later that day, the 2nd defendant attended the police station for investigation and after enquiry all three were released. 

16.  Notwithstanding that the police were involved, the harassment of the family continued.  The victim’s grandmother lived with her goddaughter, PW3.  At about 8 pm on 6 July they answered 10-odd phone calls from a male identifying himself as a Mr Cheung urging for repayment of the victim’s debt.  Cheung claimed to be a loanshark and said he would keep calling until the debt was repaid. 

17.  Two days later on 8 July at quarter to 11 in the evening, the victim and his mother were at home when they heard a loud bang and they found some red paint and glass fragments outside the main door of their home.  They received threatening SMS messages threatening to harm the family members unless repayment was made.  The sender also said his life was worth nothing and he was ready to bet his life and play the game to the end and he hoped PW2 would return the call to discuss and resolve the issue. 

18.  The first three defendants were arrested on 10 July and under caution D1 to D3 admitted having escorted the victim to his home but claimed that it was address verification only.  The 2nd defendant claimed he was employed by a Mr Cheung to confirm the debtor’s address and earns $500 each time.  On the 6 July, he said that he, D1 and D3 went to the Shun Tak Centre and took over PW1 from the male who escorted PW1 back from Macau.  He said that male gave him $500.  He said that eventually they escorted the victim to his home but he left early.  He said he did not know how much debt the victim owed or the repayment terms.

19.  Further police investigation revealed that the 4th defendant was the holder of the bank account into which the money had been paid.  The account was opened in September 2005 and bank records show that a total sum of $6,537,498.83 was deposited into the account since its opening mandate, including the $20,000 deposited on 6 July 2008.  At the time of the police investigation, there was a balance of $31,077.18 in the account.

20.  The 4th defendant was arrested on 11 July and claimed that he opened the bank account in 1998.  He told the police that he had met a man called Ah Wah in 1999 and they worked in an industrial building selling pornographic DVDs.  He said by 2005 he had accumulated credit card debts totalling $40,000.  He met Ah Wah on the street by chance and Ah Wah asked him to sell his bank account to make quick money.  He said that Ah Wah was unable to open a bank account but needed one for trading in pornographic DVDs and D4 agreed to sell the bank account in return for $30,000 and gave the ATM card and PIN code to Ah Wah.  He said he never used the bank account after he had sold it.  However, he regularly updated the bank book, he claimed that was out of curiosity to find out if it was still active.  He claimed not to have paid attention to the transactions which went through the account and he would update the bank book so that he could use the bank account to obtain loans.  He denied having withdrawn $20,000 from the bank account.

21.  Ling was arrested on 15 July by the police and inexplicably was given police bail and absconded.

22.  As regards the records of the defendants, in respect of the 1st defendant, he has one matter recorded on his record and that was for possession of dangerous drugs in 1998 for which he was placed on probation.  The 2nd defendant has three court appearances on his record.  For dangerous drugs and possession of obscene articles, in 1998 he received a suspended prison sentence.  The 3rd defendant has a conviction for affray in 2003 for which he was sentenced to 3 months’ imprisonment.  The 4th defendant has got four previous court appearances.  They include offences of infringing copyrights and sale of obscene articles, and in 2003 he was sentenced to 8 months’ imprisonment.

23.  The 1st defendant is 28 years of age and educated to Form 3 standard.  He has worked previously as a delivery worker, construction worker and an electronic technician and he has been unemployed since 2008.  I am told that he is single, he lives with his family, his father is aged 50 and his mother is a housewife.

24.  The 2nd defendant is 31 years of age.  He was educated to Form 5 standard and has worked as a construction worker and also as a salesman.  I am told he is single and he lives alone on the mainland.

25.  The 3rd defendant has been educated to Form 1 standard.  He has been unemployed for two years.  He worked in a hair salon and as a delivery worker and lives with his girlfriend in a public housing estate.

26.  I am told that in relation to the 4th defendant that he is 44 years of age, he is married, his wife lives on the mainland, he lives in a public housing estate, his parents live in Hung Hom.  He has worked previously as a casual delivery worker and as an office assistant.

27.  I was told by counsel who represented the first three defendants that clearly the main mitigation is the fact that they have pleaded guilty and they appreciate the seriousness of the offence. 

28.  In relation to the 2nd defendant, it was pointed out that he had attended the police station voluntarily for investigation, he was not arrested with the other two defendants at the home of the victim.  It was urged upon me that no triad threats were made against the victim or his mother and the defendants were not involved with what occurred in Macau or what occurred after they had been arrested.

29.  Clearly, this is part of a triad operation.  It is the usual scam that is operated on many people who visit Macau.  It is quite an extensive network that is involved in perpetrating these scams.  You have to have people involved in Macau and then people who take over the operation when they come over to Hong Kong.  I am quite sure that the people in Hong Kong know exactly what is happening, how the scam has been operated and how these victims have been duped and threatened. 

30.  D2 in his cautioned interview speaks in terms of the victim owing a debt but there is no debt in these cases, it is straight extortion.  In this case it is $650,000.  The victim and his mother must have been terrified.  When the victim returns to Hong Kong, he is in the company of D1 to D3 for a few hours before they return to his home.  If they were in any doubt as to what had occurred in Macau, they had ample opportunity to find out from the victim exactly what had happened to him in Macau.  I was sure there is no need to make any enquiries because they knew exactly what the scam was all about.  The courts have said in relation to offences of this kind is that this type of activity simply will not be tolerated.  If you involve yourselves with thugs like these, you can expect serious consequences.

31.  As counsel for the three defendants has quite rightly said, the only real mitigation in this case is the guilty plea and also, as counsel has rightly said, that the 2nd charge and the 3rd charge are really part and parcel of the same criminal enterprise.

32.  In relation to the 2nd charge, I take a starting point of 2 years for that offence and reduce that by one-third to reflect the guilty plea.  The sentence on that case will be one of 16 months’ imprisonment.

33.  In relation to the 3rd charge, the charge of blackmail, I take a starting point of 3½ years’ imprisonment for that offence and reduce that to 28 months to reflect the guilty plea, and I order that those sentences run concurrently.  D1 to D3 can sit down. 

D4

34.  In relation to D4 he is charged with a different offence.  I am told that the 4th defendant has been educated to Form 5 standard and he is living with his parents who are over 70 years of age and retired and they live in a public housing estate.  I am told that he has a wife and daughter who he gives $3,000 a month to for household expenses.  His last conviction was recorded in 2003.

35.  Counsel on his behalf reiterated what was said under caution, that the defendant had accumulated credit card debts and that is how he became involved in this offence.  I am told that the only money he made out of this was the $30,000 he got for the use of his account.  It was also urged upon me that this was not a sophisticated or well planned money laundering scheme.

36.  However, the money laundering aspect is an important part of these operations.  A considerable amount of money went through his account, $6.5 million.  He had access to the account at the time and knew how much money was going through the account.  Money laundering is a very serious offence, it is an attempt to legitimise proceeds from criminal activities and in relation to this, I am told that the defendant simply turned a blind eye to what was going on.

37.  The courts have said previously that the nature of the indictable offence from which the money was derived should be of no particular significance.  Having looked at all the features of this case, I have decided that, again, a starting point of 3½ years is appropriate in this case.  I reduce that by the third to reflect the guilty plea and the sentence will therefore be one of 28 months’ imprisonment.