HKSAR v. FU WAI SHUN

DCCC 591/2023

[2024] HKDC 885

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 591 OF 2023

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REASONS FOR SENTENCE

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The defendant faces a charge of "Conspiracy to defraud" (Charge 1)  and a charge of "Attempting to deal with property known or believed to represent proceeds of an indictable offence" (Charge 2; alternative to Charge 1). He pleaded guilty to Charge 2 (and accepted by the prosecution). I made no order as to Charge 1.

Summary of Facts

2.  About 9:30 a.m. on 7 March 2023, Mr. Siu (PW1; aged 90)  received a phone call.  A male voice (Male A)  pretending to be PW1's son-in-law claimed that he had injured someone and needed to pay compensation in several hundred thousands of dollars.  PW1 said he only had $100,000 or so.  Male A told PW1 that he would collect the money at PW1's home in about an hour.  PW1 went to the bank to withdraw $140,000 cash.

3.  About 11:00 a.m. on the same day, an unknown male (Male B)  went to PW1's home to collect the money.  PW1 gave Male B $140,000 cash.  After counting the banknotes, Male B told PW1 that it was not enough and asked PW1 for more money.  PW1 said he still had tens of thousands of dollars in his bank account.  PW1 searched for more cash at home and gave an additional $20,000 to Male B.  Before he left, Male B told PW1 to withdraw the remaining cash from PW1's bank account; he would come back to collect the money.

4.  Following Male B's instructions, PW1 went to the bank to withdraw $91,000 cash.

5.  About 4:00 p.m. on the same day, PW1 called his son, who confirmed that he was not involved in the incident as alleged by Male A.  PW1 alerted the Police.

6.  About 9:30 a.m. on 8 March 2023, PW1 received a phone call from an unknown caller.  A male voice (Male C)  told PW1 that he had not given enough money on the previous day.  PW1 asked Male C if he was to pay Male C $90,000.  Male C said $80,000 were enough and he would ask someone to collect the money later on.  PW1 informed the Police of this phone call from Male C.

7.  About 10:45 a.m. on the same day, PC 21902 (PW3)  and his team arrived at PW1's home.  Between 11:27 a.m. and 2:00 p.m. on that day, PW1 received 7 phone calls from unknown callers asking for his address and appearance; as well as telling him to bring the money to the Ground Floor of Hin Wan House, Hin Keng Estate, Tai Wai.

8.  About 2:00 p.m. on the same day, PW3 gave PW1 a brown paper bag which contained blank paper pretending to be banknotes ("the Dummy Cash").  PW1 then went to Hin Wan House alone.  CCTV footage captured the defendant approaching PW1 outside Hin Wan House.  He asked PW1 if he was going to give him the remaining $80,000.  PW1 said yes and the defendant told PW1 to follow him.

9.  About 2:07 in the same afternoon, PW1 followed the defendant to a nearby pavement.  The defendant collected the Dummy Cash from PW1 and put it in his backpack.  A minute later, PW3 intercepted the Defendant.  Upon search, the Dummy Cash was found in the backpack carried by the defendant.  PW3 arrested him.  Under caution, the defendant admitted that someone had asked him to go to the Ground Floor of Hin Wan House to collect $80,000 bail money from an uncle.

10.  In his video recorded interview, the defendant claimed that on 8 March 2023, a friend named "Siu Gai" asked him to go to Hin Wan House to collect "sneakers money" in return for a reward in the sum of $1,500.  Upon arriving at Hin Wan House, an unknown male approached the defendant asking him if Siu Gai had sent him to collect money.  He then told the defendant to pretend to be "Mr. Chan" and to collect $80,000 bail money from an uncle, whose mobility was impaired.  The uncle would give the bail money to the defendant at the Ground Floor of Hin Wan House.  Following his instructions, the defendant collected a brown paper bag (i.e. the Dummy Cash)  from an uncle (i.e. PW1).

Mitigation & Sentence

11.  The defendant is 22 and has a clear record.  Defence counsel Mr. Lam informed me that the defendant is single and resides with his mother, maternal aunt and 2 younger siblings.  The defendant started working after completing Form 3.  He was a sales person prior to his arrest.  In mitigation, Mr. Lam submitted that the defendant wanted to earn some quick money because of his financial difficulty.  He is not a sophisticated person, but was cooperative with the Police and made full and frank admissions.  The defendant was not the mastermind of the phone scam; he only did what he was told, hoping to earn a reward.

12.  The prosecution has applied for an enhanced sentence pursuant to section 27(2)(c), (d)  and (e)  of the Organized and Serious Crimes Ordinance (Cap.455)  on the basis of prevalence; the nature and extent of harm caused to the community; and the nature and extent of the total benefit gained by anyone from the present offence.  Mr. Lam did not object to the application for enhancement.

13.  I bear in mind the Court of Appeal's decision in HKSAR v Xu Mai Qing CACC 464/2005, whereas Yeung JA (as he then was)  held "Under section 27(11)  of OSCO, what the prosecution has to prove is the prevalence of the offence, not the increase in the number of such offences[1]."

14.  I have read the witness statement of DCIP Tang dated 26 February 2024.  I am satisfied that in 2023, telephone deception cases were prevalent in Hong Kong in terms of the number of cases as well as the total value of monetary loss.

15.  The "By Hand" mode phone deception cases always involve someone picking up the money left behind by the victim at a public place or collecting the money directly from the victim.  Hence, the money collection portion is part and parcel of any type of phone deception ("Guess Who", "Pretend Officials" or "Detained Son").  Although the "collector" may not have knowledge of the underlying phone deception, the circumstances under which he/she picks up or collects the money are usually peculiar and would thus arouse his/her suspicion about the legality of his/her collecting act and/or the nature of the money collected.  That is the reason why the "collector simpliciter" is often charged with a money laundering offence (instead of deception).

16.  There is clear and cogent evidence before me that the "By Hand" mode phone deception is still widespread and commonly being practised in Hong Kong today.  The court must send a clear message to the general public that people who play the role of "collector" will receive severe punishment, so that there is a deterrent effect.  When there are fewer or no willing "collectors", the "By Hand" mode phone deception method would fail.

17.  There seems to be no evidence suggesting that the defendant had any prior knowledge of the underlying phone deception; however, the scam would have been meaningless without a willing "collector".  Given the role played by him, the amount involved and the overall circumstances, I grant the prosecution's application and will enhance the sentence by 25%.

18.  The Court of Appeal in SJ v Wan Kwok Keung [2012] 1 HKLRD 201 held :-

Generally, the sentence for "money laundering" offences should mainly reflect the amount of "black money" laundered and not the benefit obtained by the defendant or others. The reason being that it is very difficult to prove the benefit concerned, and in most "money laundering" cases, there may not be evidence to show from what indictable offence the "black money" are in fact derived. Of course, if there is information to prove that the "black money" is originated from serious crimes, including drug trafficking, kidnap and blackmail, illegal human trafficking, other organized crimes, etc. or the defendant's benefit is huge, then the sentence should be adjusted upward.[2]

19.  In determining the proper starting point, I have reminded myself of the sentencing principles laid down in HKSAR v Cen Huakuo [2015] 2 HKLRD 951.  I have also borne in mind the amount of money involved, the duration of the offence, the defendant's role in relation to the movements of funds as well as his personal circumstances.  A marked difference between the defendant in the present case and the applicant in Cen Huakuo is that the defendant is not a mainland resident who came to Hong Kong to commit crimes.

20.  For the purpose of sentencing, I accept there is no evidence showing that the defendant was involved in or knew about the details of the phone scam against PW1.  His culpability is perhaps less than the perpetrator(s)  of the underlying phone deception[3]. Hence, for Charge 2, I adopt a starting point of 2.5 years' imprisonment.  With the timely guilty plea, the sentence is reduced to 20 months.  Apart from this, I see no other mitigating factors which warrant any further reduction.  With the 25% enhancement, I sentence the defendant to 25 months' imprisonment.