HKSAR v. TSANG TSZ CHUN

DCCC 109/2018

[2019] HKDC 566

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 109 OF 2018

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REASONS FOR SENTENCE

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1.  The defendant was convicted of six charges of theft, contrary to section 9 of the Theft Ordinance, Cap 210 (1st charge, 2nd charge, 3rd charge, 4th charge, 5th charge and 16th charge) and five charges of using a copy of a false instrument, contrary to section 74 of the Crimes Ordinance, Cap 200 (6th charge, 10th charge, 11th charge, 12th charge and 15th charge) on his own plea and agreement to Summary of Facts.

2.  At all material times, Eddie Wang was the Chancellor of New Method College (“the college”) and the defendant was employed by the college.  His job duties included leasing matters of the swimming pool (“the pool”) of the college.

3.  Since 1 September 2012, the college ceased enrolling students and the pool was respectively rented out to Hoi Tin Swimming Consultants Limited (HTSCL) and International (Elite Divers Training Centre Limited) (IEDTCL). 

4.  Since 2014, the defendant had without authority entered into further leasing agreements with Penguin Swimming Club (PSC) and Win Tin Swimming Centre Limited (WTSCL).

5.  The college held various accounts with Hang Seng Bank.

6.  Amongst them, there is an account number 024-242-128866-007 specially assigned for the pool’s expenses and collection of rental payments.  In order to facilitate the daily operation of the college and the pool, a Mr Hui was appointed as one of the signatories of the college account.

7.  At all material times, HTSCL holds an account at DBS Bank, account number 016-208-08-307-45578 (HTSCL’s account) and PSC holds an account at Shanghai Commercial Bank in the name of Penguin Swimming Club, O/B Kingrich Consultants Limited, account number 025-330-82-086580-001 (PSC’s account). WTSCL holds an account at Hang Seng Bank, account number 024-210-228227-001 (WTSCL’s HSB account) and Bank of China (Hong Kong) Limited account number 012-925-00069723 (WTSCL’s BOC account).

8.  At all material times, the defendant was the sole signatory of three bank accounts respectively held at the Hongkong and Shanghai Banking Corporation Limited, account number 568-8-033520, Citibank (HK) Limited, account number 46400265, and Hang Seng Bank, account number 242-315471-882.

9.  In the year 2011, the defendant incorporated Power Creative Development (CDC) which held a bank account at Hang Seng Bank, account number 789-634748-883 (CDC’s account) and the defendant was the sole signatory.

10.  The defendant was arrested on 20 August 2015.  Under caution at the scene he confessed having suffered from loss in his investments and hence stole the college money for his credit card payments.

Charge 1

11.  Ms Liu Ka Ying (“Liu”) was the clerk of HTSCL.  Since year 2000, HTSCL had been renting the pool and all along rental payments were made to the college account.

12.  On 16 July 2013, Liu received a call from the defendant informing her that pool rentals should be paid to CDC’s account from September 2013 onwards. The defendant said such arrangement was made as a result of the college’s cessation of student enrolment. 

13.  On the same day, the defendant confirmed the correct spelling of the CDC via email.  Subsequently, Liu received another call from the defendant asking her not to mail the cheque to the college but to bank in directly.

14.  From then onwards, Liu made payments to CDC’s account directly.  Between July 2013 and October 2014, HTSCL made 12 payments totalling HK$260,820 by way of cheques as the pool’s rental payments to CDC’s account.  The cheques were deposited and the sums of money were withdrawn from HTSCL’s account.

15.  Wang confirms that CDC was not authorised to collect the pool’s rental payments on behalf of the college.  Liu confirms that had she known CDC was not authorised to collect the pool’s rental payments on behalf of the college, she would not have arranged the cheques to be issued according to the defendant’s instructions.

Charge 2

16.  Mr Leung Chun Kin Edmond (“Leung”) is a swimming coach of PSC.  In November 2013, Leung entered into an agreement with the defendant to rent the pool for January 2014.  Through WhatsApp messages, the defendant instructed Leung to pay the pool’s rental payments into CDC’s account.

17.  On or about 15 November 2013, a cheque of $7,440 was drawn from PSC’s account in favour of CDC.  The cheque was deposited and the sum of money was withdrawn from PSC’s account.

18.  The college had no knowledge of PSC’s rental agreement with the defendant, nor did it receive any payment in relation thereto.  And Wang confirms that CDC was not authorised to collect the pool rental payments on behalf of the college.  Leung confirms that had he known CDC was not authorised to collect the pool’s rental payments on behalf of the college, he would not have arranged for cheques to be issued according to the defendant’s instructions.

Charges 3 to 5

19.  Mr Chung Ka Bo is the human resources manager of WTSCL.  In April 2014, he entered into an agreement with the defendant to rent the pool.  The defendant did so without authority.

20.  Between 24 March 2014 and 14 May 2014, four cheques totalling HK$185,650 issued in favour of CDC were drawn from WTSCL’s HSB account. (Charge 3)

21.  Between 1 September 2014 and 25 November 2014, five cheques totalling HK$105,800 issued in favour of CDC were drawn from WTSCL’s BOC account were issued. (Charge 4)

22.  On or about December 9, 2014, a cheque of $24,050 issued in favour of CDC was drawn from Chung’s personal bank account, account number 012‑925-00086959 (Charge 5).

23.  The college had no knowledge of WTSCL’s rental agreement with the defendant, nor did it receive any payment in relation thereto. 

24.  Wang confirms that CDC was not authorised to collect the pool’s rental payments on behalf of the college.

25.  Chung confirms that had he known CDC was not authorised to collect the pool’s rental payment on behalf of the college, he would not have arranged for cheques to be issued from WTSCL’s account or issue the cheque from his personal account according to the defendant’s instructions.

26.  Under caution, the defendant admitted to having requested swimming clubs to issue cheques payable to CDC since September 2013 up till June 2015.  He also admitted to have deceived HTSCL.

Charges 6, 10, 11, 12 and 15

27.  Administrative arrangement at the college required the defendant to submit photocopies of collected cheques from HTSCL to Ms Ho Shuk Yin (Ho).

28.  In order to conceal the pocketing of the pool’s rental payments from HTSCL, the defendant prepared false photocopies of cheques for the college’s accounting purposes.

29.  Between 2 April 2014 and 6 May 2015, five false photocopies of cheques, purportedly drawn by HTSCL from Standard Chartered Bank accounts number 003-971-8-935432-0 (SCB Account 1) and 003-971-8-934907-0 (SCB Account 2), were submitted by the defendant to college.  In the belief that the cheques were genuine, PW2 made entries in the college’s accounts accordingly.  On each occasion, the college’s account was credited with the amounts stated in the false photocopies of the cheques.

30.  Bank inquiries revealed that SCB Account 1 was the account of a man called Chan Ching Nam, Varro (Chan), whereas SCB Account 2 was jointly held by the defendant and Chan. 

31.  Further inquiries revealed that the money purportedly received from four of the five cheques, namely the cheques numbered 091397, 091405, 100845 and 100850, were in fact payments made by IEDTCL, which was one of the renters of the pool, and the money purportedly received from the remaining cheque, namely the cheque number 091403, actually was a payment made by CDC.

32.  Under caution, the defendant admitted to having prepared the five false photocopies of cheques and submitted them for the college’s annual audit.

33.  HTSCL has no relationship with IEDTCL and/or CDC which could have led these parties to pay for HTSCL’s rent.  HTSCL does not hold SCB Account 1 either.

34.  On or about 2 April 2014, the defendant used a copy of a cheque number 091397 bearing an amount of HK$1,600 purportedly issued by HTSCL and drawn on SCB Account 1, which was, and which he knew or believed to be false, with the intention of inducing PW2 to accept it as genuine and by reason of so accepting it, to do or not to do some act to the college’s prejudice (Charge 6).

35.  On or about 18 July 2014, the defendant used a copy of a cheque number 091403 bearing an amount of $5,000 purportedly issued by HTSCL and drawn on SCB Account 1, which was, and which he knew or believed to be false, with the intention of inducing PW2 to accept it as genuine and by so, accepting it to do or not to do some act to the college’s prejudice (Charge 10).

36.  On or about 26 August 2014, the defendant used a copy of a cheque number 091405 bearing an amount of $4,000 purportedly issued by HTSCL and drawn on SCB Account 1, which was, and which he knew or believed to be false, with the intention of inducing PW2 to accept it as genuine and by reason of so accepting it, to do or not to do some act to the college’s prejudice (Charge 11).

37.  On or about 16 September 2014, the defendant used a copy of a cheque number 100845 bearing an amount of $1,200 purportedly issued by HTSCL and drawn on SCB Account 2, which was, and which he knew or believed to be false, with the intention of inducing PW2 to accept it as genuine and by reason of so accepting it, to do or not to do some act to the college’s prejudice (Charge 12).

38.  On or about 6 May 2015, the defendant used a copy of a cheque number 100850 bearing an amount of $6,400 purportedly issued by HTSCL and drawn on SCB Account 2, which was, and which he knew or believed to be false, with the intention of inducing PW2 to accept it as genuine and by reason of so accepting it, to do or not to do some act to the college’s prejudice (Charge 15).

Charge 16

39.  PW1 requested for an audit check of the college’s account and realised that on 37 occasions, for reasons unknown to him, money totalling $276,540.44 had been paid into CDC’s account or the defendant’s bank accounts.

40.  Under caution, the defendant admitted to preparing cheques with an erasable pen and presenting them for Hui’s signing.  After Hui had signed on the cheques, he erased the payees and replaced them with either CDC or himself.  When shown with the copies of the cheques, he admitted to pocketing some of them.

41.  Between 30 September 2013 and 8 May 2015, both dates inclusive, the defendant stole choses in action, namely, debts in the sum of $276,540.44 owed by Hang Seng Bank in the college’s account to the college.

Criminal record

42.  The defendant has previous convictions relating to causing wasteful employment of police in year 2002.

Mitigation

43.  The defendant is aged 35.  He is single and resided with his parents and elder sister until the death of his grandfather, and since then he lives with his grandmother. 

44.  He was educated up to Form 4 level. 

45.  It is submitted by defence counsel that the defendant is a filial son. It is submitted also that his father is a driver for the hospital and the mother is suffering from cancer and she is a housewife.

46.  Since the defendant left school, he had worked as a motor car sales before he joined the New Method College, at first as a sports department assistant and after two years of hard work, he was promoted and was assigned to be responsible for assisting in the sports department and office work.  Because he was told that the school would no longer admit new students, the defendant started investing in London Gold and lost a lot of money.  He therefore started committing the present offences.

47.  It was submitted the defendant regretted what he has done to a school which he has loved.  It is also said the defendant frankly admitted his guilt when questioned by police and has pleaded guilty at the earliest opportunity.

48.  Mitigation letters were presented to this court, including that from the defendant.  In the defendant’s letter to this court, he said he was deeply remorseful as to what he had done to the school, a disgrace to the family that he has suffered a lot of stress since he was arrested and he asked this court for a chance to turn a new leaf and vowed not to commit any further offence in future.  He knew the offences committed by him were really serious and he was willing to bear the consequence.

49.  The other letters from relatives, alumni of New Method College, say in essence that the defendant was a caring person, that he was not a greedy person by nature and that he must be encountering great difficulty leading to his commission of the present offences.

50.  Defence counsel also further informed this court that the defendant is a charitable person and that he donated to charities.  Receipts during the period from year 2012 to year 2015 were presented to this court. 

51.  It is said that the money involved in the present case total $860,300.44 and that the defendant had returned $5,000 to the college leaving the net loss to the college to stand at $855,300.44.

52.  This court is also referred to cases, HKSAR v Wu Ching, DCCC 8/2017 and HKSAR v Cheung Mee Kiu, CACC 99/2006. 

53.  It is submitted on behalf of the defendant that the sentencing starting point in this case should fall within the band of 2 to 3 years range.

Discussion

54.  The defendant is at all material times the employee of the college entrusted with the leasing matters of the pool.  The case involved a breach of trust.

55.  In relation to the theft charges, defence counsel had referred this court to the Cheung Mee Kiu case where a guideline was set by the Court of Appeal for theft cases involving breach of trust.  It is submitted by defence counsel that the guideline set out is not a straitjacket which this court agrees.

Charge 1

56.  The money involved in this charge is the sum of $260,820.  The offence was committed over a period of 15 months.  It is a breach of trust case. Considering the guideline laid out in Cheung Mee Kiu and considering the offence being perpetrated over a long period of time, the sentencing starting point for this offence would be 2 years and 3 months.

57.  This court has further considered all that was being advanced in mitigation and find that the most valid mitigating factor was his own guilty plea, of which the defendant is entitled to a full one-third sentencing discount.  He is therefore sentenced to 18 months’ imprisonment for this charge.

Charge 2

58.  From the agreed Summary of Facts it is also apparent that the modus of the defendant involved a certain degree of planning.  Firstly, without authority and knowledge of the employer, he entered into the agreement with Leung renting the pool of the college.  And further, he had provided Leung with CDC’s account.  Further, he asked Leung to pay the rental into the CDC’s account.  The amount involved in this case was $7,440.  The appropriate sentencing starting point in this case would lie at 9 months and of which again he is entitled to a full one-third sentencing discount and he is sentenced to 6 months’ imprisonment for this charge.

Charge 3

59.  The amount involved in Charge 3 is a total sum of $185,650.  The offence was committed over a period of approximately 14 months between the period 24 March 2014 and 14 May 2015.  Again, considering the sentencing starting point in the Cheung Mee Kiu case and the fact that prolonged period of commission of the offence, the appropriate sentencing starting point would be 21 months.  After the one-third sentencing discount, the same is reduced to 14 months’ imprisonment.

Charge 4

60.  The amount involved in the 4th charge in total a sum of $105,800 and this offence was committed over a period of approximately three months, between 1 September 2014 and 25 November 2014.  For this charge, the sentencing starting point would lie at 15 months, and after one-third sentencing discount, the same is reduced to 10 months.

Charge 5

61.  The appropriate sentencing starting point again lies at 12 months and after the one-third full sentencing discount the defendant is sentenced to 8 months’ imprisonment for the 5th charge.

Charge 16

62.  The defendant has stolen $276,540.44 from the college under this charge.  The scheme devised by him involves him causing Hui to sign the cheques of the college using the erasable pen and thereafter changing the payee of these cheques.  The act itself is very dishonest.  The period over which this offence was committed was approximately 19 months involving 37 occasions. The commission of this offence by the defendant involved a high degree of planning and sophistication.  The criminality of this offence far exceed those of the former theft charges in this case.  The appropriate sentencing starting point lie at 3 years and after the one-third sentencing discount the same is reduced to 2 years’ imprisonment.

Charges 6, 10, 11, 12 and 15

63.  Charges 6, 10, 11, 12 and 15 are basically attempts by the defendant to cover up the offences committed by him under Charge 1.  The defendant had prepared false photocopies of cheques allegedly issued by HTSCL and when actual payments was made via bank accounts of which the defendant was interested.  The amounts in each of these cheques were respectively $1,600 (Charge 6), $5,000 (Charge 10), $4,000 (Charge 11), $1,200 (Charge 12) and $6,400 (Charge 15).

64.  The criminality of the defendant in each of these charges, in my view, are the same. 

65.  Section 74 of the Crimes Ordinance, Cap 200, says that upon conviction or indictment of this offence, the maximum sentence is 14 years of imprisonment. 

66.  There is no sentencing tariff for this offence. 

67.  Considering the circumstances under which the offences were committed, for each of these offences the sentencing starting point is 12 months’ imprisonment and after the full one-third discount, the same is reduced to 8 months’ imprisonment.

68.  The total amount involved for the six theft convictions total $860,300.44, of which the defendant has repaid $5,000, leaving net loss to the employer at $855,300.44. These offences were committed within the period from 29 July 2013 to 8 May 2015, ie over 22 months, involving numerous transactions. 

69.  As for the five convictions involving using a copy of a false instrument, they were committed within a period of 14 months, ie between 2 April 2014 to 6 May 2015.

70.  Considering the totality principle, the just and proportionate sentence in this case, having regard to the defendant’s overall culpability, would lie at 4 years.  The same is reduced to 2 years and 8 months after the full one-third discount.

71.  Accordingly, 1 months’ imprisonment in the sentence in each of the Charges 1, 2, 3, 4 and 5 are to run consecutive to the sentence in Charge 16. The rest of the sentence in each of these charges are to run concurrent to the sentence in Charge 16, making a total sentence of 2 years and 5 months. 

72.  The sentences for Charges 6, 10, 11, 12 and 15 are all to run concurrent with each other, of which 3 months’ imprisonment are to run consecutive to the sentence for the theft charges and the other 5 months’ imprisonment shall run concurrent with the sentence in the theft charges, making a total sentence for the defendant in this case to 2 years and 8 months’ imprisonment.