HKSAR v. LIN CHING HUNG

HCCC 69/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 69 OF 2016

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REASONS FOR SENTENCE

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1.  The defendant was committed for sentence to this Court on 29 January 2016, having pleaded guilty to the charges he faced at the earliest opportunity in committal proceedings at Eastern Magistrate’s Court.

2.  The charges to which he pleaded guilty all occurred on 8 February 2015 and consist of one count of trafficking in a dangerous drug, namely 101.4 g of a crystalline solid containing 99.4 g of methamphetamine hydrochloride (Count 1), one count of possession of equipment for making false instruments, namely one tipping machine, one card embossing machine, one card encoder, one roll of silver colour tinfoil, one roll of gold colour tinfoil, 17 plastic cards each with a magnetic stripe (14 white cards and 3 semi-finished cards purportedly issued variously by the Bank of Montréal, Citibank and the Hong Kong and Shanghai Banking Corporation Ltd) and 27 UnionPay bankcards (Count 2), and one count of possessing false instruments, namely two plastic cards purported to be MasterCard cards genuinely issued by Bank of Montréal and one TransForex MasterCard card encoded with data purportedly authorised by Visa International (Count 3).

3.  Sentencing of the defendant was adjourned because an offer of assistance from the defendant to the authorities had yet been evaluated for consideration by this Court when sentencing the defendant for these offences.  It appears that the assistance proffered was of no value and will not have a bearing on the sentencing of the defendant.

4.  The brief facts to which the defendant agreed upon pleading guilty to the charges he faced are as follows. 

5.  At around 22:04 hours on 8 February 2015, police officers conducted an operation in the vicinity of the defendant’s village house which was located in Wai Loi Tsuen, Tung Hing Road, Sheung Shui.  He had been intercepted by the police as he was about to enter his house.  At the time, he was holding a bag of potato chips in his left hand and after it was examined by the police it was found to contain two packets of Ice as specified in Count 1.  An examination of his wallet by the police uncovered a TransForex MasterCard card as specified in Count 3. 

6.  A search was then conducted by the police of the defendant’s house.  Inside the defendant’s bedroom, which he shared with his younger brother, the police found near his bed the cards as specified in Counts 2 and 3.  The other items as specified in Count 2, namely the tipping and card embossing machines, the encoder and rolls of tinfoil, were found in a cabinet outside the bedroom.  The roll of silver tinfoil was found in the tipping machine.

7.  A forensic examination of the items seized disclosed that the three semi-finished cards were false; the two cards encoded with credit card account data and purported to be MasterCard cards issued by the Bank of Montréal were false; the TransForex MasterCard card was a genuine card but with a Visa account encoded on its magnetic stripe; the tipping and embossing machines and the card encoder were all functioning properly; the embossing machine was able to emboss alphanumeric and symbol entries on control cards; the tipping machine was able to heat transfer the colour foil to the embossed entries on control cards; the silver tinfoil found in the tipping machine showed some previous records of particulars that did not match with the particulars embossed on the cards seized; the encoder was able to write or overwrite data to, read data from or erase the stored data in the magnetic stripes of the seized white cards; and the embossed marks on some of the cards seized were found prepared by the embossing machine that was seized or by a machine of similar make.

8.  The MasterCard seized from the defendant’s wallet was encoded with Visa account data and was confirmed to be non-genuine. Upon an examination of the UnionPay bankcards, it was found that the magnetic stripes were rewritable and could store credit card account data with the use of the card encoder that was seized.

9.  In relation to these matters, the defendant was arrested and cautioned by the police.  He remained silent in relation to the drug offence but in relation to the credit card offences he stated that he had used the equipment found in his house for making false credit cards; that the cards seized from his bedroom were false which was bought for him by his friend from TaoBao; and that the card seized from his wallet he had taken from a basket on a bicycle and intended to use it for making a false credit card. 

10.  In subsequent interviews under caution the defendant elaborated about the circumstances of the credit card offences.  He said a friend of his obtained the equipment for him from TaoBao in December 2014 for which he paid $13,000 cash.  His friend also bought for him 20 false credit cards from mainland China at a cost of $1,500.  He said he threw away 15 of them because they were of poor quality and the remaining 5 were seized by the police from his bedroom.  He bought 10 sets of credit card account data from the Internet at around $3,000 and entered about four sets of data to the cards he bought by using a computer and the encoder.  He used the embossing machine to emboss the numbers and words on the card and the tipping machine to colour them.  He said the 14 white cards were complimentary when he purchased the equipment from TaoBao.  Of the 27 UnionPay cards, 24 belonged to him which had been found by his brother in a lane near a restaurant and the other 3 belonged to his friends who had left them in his room after visiting him.

11.  Also found by the police inside the defendant’s room were one electronic scale and 17 empty resealable plastic bags.  The defendant admits that he was trafficking in the dangerous drugs seized from him.

12.  By way of mitigation, the most that can be advanced on behalf of the defendant is his early pleas of guilty.  The defendant is now 21 years old.  He was 20 when he committed these offences.  He was born in Taiwan but grew up in Hong Kong.  He attended school in Hong Kong up to Form 4.  He is single and at the time of the offence lived with his parents and was unemployed.  Although, I am told he previously had a job as a mechanic which he lost just before these offences.  He has three previous convictions.  He was first convicted of assault and theft in April 2010 and was put on probation initially for 12 months but it was extended to 30 months. Later in March 2014, he was convicted of criminal damage and ordered to attend a drug addiction treatment centre.  He was discharged from the centre on 12 October 2014.  It was not long after this that he committed these offences.

13.  I will address the sentence to be imposed in relation to each count before I address them collectively by applying the totality principle.

14.  For the drug trafficking offence, Count 1, the narcotic content of drugs involved was 99.4 g of methamphetamine hydrochloride, otherwise known as Ice.  The guideline tariffs for trafficking in Ice, on conviction after trial, are contained in HKSAR v Tam Yi Chun [2014] 3 HKLRD 691.  The guideline starting point for this quantity of drugs is 11 years and 6 months’ imprisonment.  This will be reduced by one third for the defendant’s guilty plea to 7 years and 8 months’ imprisonment.

15.  Counts 2 and 3 are offences generally described as credit card fraud.  In the case of R v Chan Sui-to and Anor [1996] 2 HKCLR 128, the Court of Appeal set out relevant factors that a sentencing court will need to consider when sentencing for credit card frauds.  Whilst the list of factors was not exhaustive, they included the size of the operation; the planning that had gone into perpetrating the fraud; any international dimension involved in the offence; and the role played by the defendant.  The Court went on to suggest that a defendant who plays an active but not necessarily a key role in a medium-size operation involving between $50,000 and $150,000, with no elaborate planning and equipment, and without an international dimension, should receive a sentence of 5 to 6 years after trial.  The sum of money related to the value of the property obtained through the fraudulent use of credit cards.  The Court noted as to this factor that it was only one of the factors to be taken into account and not the most significant one.

16.  The case of Chan Sui-to was considered and elaborated upon in HKSAR v Ng Swee Thiam and Ors [2001] 1 HKLRD 772.  There the Court of Appeal felt that Chan Sui-to needed amplification on the question of the amount of losses which it said may pale into insignificance when consideration is given to the potential for losses in the future.  The Court went on to explain that in that case the only limit on the extent of losses to be incurred was the capacity to produce and use the false credit cards and the amount of time before the miscreants were caught. The Court noted at 778C-D that:

“It is this potential for losses which is the most important consideration. It may well be the case that it is not a simple matter to lay down any hard and fast rule of thumb in determining appropriate sentences in individual cases.”

17.  With these sentencing remarks in mind I will address the sentence is to be imposed on Counts 2 and 3.

18.  For the possession of equipment for making false instruments offence, Count 2, there is no doubt in the present case that the operation conducted by the defendant was for the manufacture of false credit cards.  Mr Philip Chau, counsel for the defendant, submits that this was a “one man band” with no other persons involved.  This therefore means that the defendant did everything in the manufacture of false credit cards.  In terms of his manufacturing operation he played the principal and only role.  It is hard to accurately ascertain the potential losses but it is safe to say that they would have been substantial given the manufacturing operations of the defendant and the cards that were found there either ready to be processed or having been processed as false credit cards.  This offence warrants a starting point of 6 years’ imprisonment which I will reduce by one third for the defendant’s guilty plea to 4 years’ imprisonment.

19.  For the possession of false instruments offence, Count 3, this concerned three false credit cards that had been produced and were ready to be used.  This offence warrants a starting point of two years imprisonment which I will reduce by one third for the defendant’s guilty plea to 1 year and 4 months’ imprisonment.

20.  I will now consider the sentences imposed in relation to each Count collectively by applying the totality principle.  As to Counts 2 and 3, given that they arose out of the same set of circumstances, I make the sentence on Count 3 concurrent to the sentence on Count 2.  As Count 1 concerned an entirely different form of criminal misconduct from Counts 2 and 3, I will make the respective sentences for these two different criminal offences partially consecutive.  I will make the concurrent sentences of Counts 2 and 3 of 4 years’ imprisonment partially consecutive as to 2 years on the sentence of Count 1 of 7 years and 8 months’ imprisonment.  Accordingly, I impose on the defendant a total sentence of 9 years and 8 months’ imprisonment.