HKSAR v. LEE LAI MEI

DCCC 859/2021

[2022] HKDC 469

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 859 OF 2021

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Reasons for Sentence

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1.  D1 and D2 each pleaded guilty to a charge with D3 of conspiracy to deal with property known or reasonably believed to represent proceeds of an indictable offence, contrary to sections 25(1)  and (3)  of the Organized and Serious Crimes Ordinance, Cap. 455 and sections 159A and 159C of the Crimes Ordinance, Cap. 200.

2.  D3 pleaded guilty to above two charges and also two charges of conspiracy to defraud, contrary to common law and punishable under section 159C(6)  of the Crimes Ordinance, Cap. 200. 

Charges 1 & 3

3.  On 16 January 2018, WONG Sze-man (“PW1”)  saw a quick money advertisement on Facebook with a contact number 9263 4741 (“Number”)  provided.  PW1 sent WhatsApp messages to the Number and was told that she could earn quick money by (a)  fund relocation; (b)  money transfer; and (c)  applying for a Hong Kong identity card (“HKIC”)  (“3 Jobs”). PW1 chose “money transfer” and was told that money would be deposited into her account and she would be given 15% of the transaction amount as commission but she had to pay 2% of the transaction amount as security money.  PW1 agreed to receive HK$400,000 on her bank account and pay HK$8,000 as security money in order to earn HK$60,000.

4.  On 22 January 2018, PW1 was asked to deposit HK$8,000 into a Bank of China (Hong Kong)  account numbered 012-758-1-014899-8 which belonged to D1 (“BOC Account”).

5.  On 23 January 2018, PW1 deposited HK$8,000 into the BOC Account and sent the deposit advice to the Number via WhatsApp.  PW1 was promised that HK$400,000 would be deposited into her account but the promise did not materialize.  PW1 reported the case to the police.

Charges 2 & 4

6.  On 9 February 2018, CHOW Suet-yi (“PW2”)  noticed a quick money advertisement on Facebook with the Number provided.  She contacted the Number and was offered the 3 Jobs by “Ah Fung”.

7.  On 28 February 2018, PW2 contacted “Ah Fung” for fund relocation.  PW2 provided her personal information including HKIC, address proof, bank passbook, and income proof to “Ah Fung” via WhatsApp.  “Ah Fung” told PW2 to apply loans from 3 financial institutions and transfer the money to the Hang Seng Bank account numbered 780-128633-882 which belonged to D2 (“HSB Account”).  “Ah Fung” claimed that he would arrange the staff at the financial institutions to do some tricks so that PW2 would not be required to repay the loan.  PW2 would be given 60% of the money while the rest would be used to facilitate the matter.

8.  On 16 March 2018, PW2 was notified that her loan applications totalling HK$60,000 were approved.  On 19 March 2018, PW2 received HK$59,915.57 in her bank account.  PW2 then deposited cash of HK$59,800 into the HSB Account but she did not receive any payment as promised.  PW2 reported the case to the police.

ARREST & CAUTIONED STATEMENTS

9.  On 16 July 2018, D1 and D2 were arrested.  With the assistance of D2, D3 was arrested on 17 July 2018.

D1

10.  Under caution, D1 stated that she knew what it was about but she only helped a friend.  A record of interview and a video recorded interview were subsequently taken from D1.  Under caution, D1 stated that:

(a)  She worked as a part time cleaning worker and a warehouse keeper. The BOC Account was her payroll account.

(b)  In January 2018, she added “Ah Fung” on Facebook and they chatted. She did not know the full name of “Ah Fung” nor had she met “Ah Fung”. One day, “Ah Fung” asked if she had an account in BOC for collecting loan from a friend. She then gave the BOC Account number to “Ah Fung”. As soon as she received the money, she withdrew cash and passed the money to a woman aged around 30 as instructed by “Ah Fung”.

(c)  She did not know PW1 or D2. She did not receive any rewards.

D2

11.  Under caution, D2 stated that she did not know anything and she only wanted to help her friend.  A record of interview and a video recorded interview were subsequently taken from D2.  Under caution, D2 stated that:

(a)  In November 2017, she browsed through Facebook and saw a quick money post. Since she was in need of money, she contacted the number 5166 6278 via WhatsApp. The other side introduced himself as “Oscar” and the job was relocating funds for overseas company. Since it seemed complicated, she asked for the other options but was not given any reply.

(b)  In March 2018, “Oscar” messaged her saying that his friend went bankrupt and could not receive salary directly. “Oscar” asked if she could help his friend to receive salary and she would be given remuneration. She then sent her HSB Account to “Oscar”.

(c)  Later on, “Oscar” said that there would be salary of about HK$60,000 deposited into her account in the coming two days and asked her to withdraw HK$59,800. She did so and passed the money to a woman aged around 25. The woman asked her to keep HK$3,000.

(d)  She received salary for “Oscar” on four more occasions and she was asked to keep HK$500 to HK$1,000 as handling fee. She received a total of HK$22,000 and she passed HK$12,000 to the woman. HK$10,000 was yet to be passed.

D3

12.  Under caution, D3 said that she did that for other for money.  Suspicious messages were found on D3's mobile phone.  D3 stated under caution that she only acted upon instruction to deceive others.  In the subsequent video recorded interviews, D3 stated inter alia that:

(a)  The person who instructed her was called “Ah Ho” who was aged around 27-28. In mid-2017, she noticed some quick money post on Facebook. She was asked to take out loans given the understanding that no repayment was required. It turned out to be a scam which arose her interest. She searched on Facebook and saw another post claiming that one could earn several ten thousand dollars a month. She reached out and got to know “Ah Ho”.

(b)  In around August 2017, “Ah Ho” said that there was a job of collecting money but the pay was only several thousand dollars. “Ah Ho” gave her a Facebook account and passed her the contacts of people who were interested in making quick money. Those referred by “Ah Ho” usually took the bait. She told the victims to take out a loan and deposit the money into HSB Account or BOC Account. She told them that they would not be required to make any repayment because the record would be erased, and in return they could share half of the money. She also told the victims that there would be money deposited into their accounts but they had to pay security money first. She would pass the money to “Ah Ho” and her rewards varied from HK$500 to HK$2,000. She had successfully deceived a total of HK$100,000 to HK$200,000 from 10 odd people. Her total reward was HK$10,000 to HK$20.000.

(c)  PW2 added her on Facebook. After seeking instruction from “Ah Ho”, she told PW2 to borrow a total of HK$60,000 from 3 financial institutions and deposited the money into HSB Account. She then collected the money from D2 whom she knew on Facebook. D2 got HK$3,000 and she kept HK$2,000. The rest was given to “Ah Ho”. She did not know D1.

(d)  She had two phones. IPhone 7 plus was for personal use while iPhone 5s (“D3's Mobile Phone”)  was for this scheme.

Mobile Phone of D3

13.  The following WhatsApp messages between D1 and D3 were

retrieved from D3's Mobile Phone (Charge 1):

(a)  On 5 September 2017, D1 asked D3 if there was any part time job. D3 proposed inter alia “money transfer” which could earn HK$10,000 to HK$70,000 per transaction but a bank account was required. D3 said that D1 could get HK$500 if HK$7,000 was deposited into her account. D1 agreed.

(b)  Between 7 September 2017 and 7 March 2018, D3 on 17 occasions told D1 that there would be money deposited into her account and D1 could keep HK$500 to HK$1,000 as a reward each time. D1 handed over the money to a female after she had withdrawn the money.

14.  The WhatsApp messages between D2 and D3 showed that (Charge 2):

(a)  On 15 November 2017, D2 messaged D3. D3 introduced herself as “Oscar” or “Ah Fung” and asked how much D2 wanted to earn. D2 replied HK$40,000 to HK$50,000 per month. D3 proposed inter alia “money transfer” which could earn commission of HK$10,000 to HK$70,000 each time, but added that the bank account should have been opened for over 2 years and each person could only do this job twice.

(b)  D3 asked which bank account D2 was using, how often she used her bank account and what the largest deposit was. D3 told D2 those were relevant in considering whether she was qualified for the job.

(c)  On 17 March 2018, D3 asked whether D2 would lend her account including bank card and password to the bankruptee for salary payment. The reward would be HK$3,000 per month. D2 agreed.

(d)  Between 20 March 2018 and 16 July 2018, D3 on 6 occasions told D2 that money had been paid into D2's account and that the bankruptee would send his friend to come to collect the money.

15.  Photos of 23 deposit advices were retrieved from the WhatsApp records of D3's Mobile Phone.  The deposit advices showed that:

(a)  16 deposits totaling HK$88,500 were deposited into BOC Account between 16 October 2017 and 7 March 2018.

(b)  5 deposits totaling HK$84,800 were deposited into HSB Account between 28 April 2018 and 16 July 2018.

(c)  2 deposits totaling HK$12,000 were deposited into a Hang Seng Bank account numbered 363-817792-668 which belonged to D3.

(d)  Names and signatures were appended on most of the deposit advices, and a figure was written on 3 of the deposit advices. The money deposited into the account constituted 2% of the amount written thereon, e.g. the money deposited was HK$4,000 and it was written “$200,000” on the deposit advice.

Bank Records

16.  Bank records showed that there were 20 deposits totaling HK$106,500 deposited into BOC Account between 7 September 2017 and 7 March 2018; and 7 deposits totaling HK$102,800 deposited into HSB Account between 20 March 2018 and 16 July 2018.  The deposits tallied with the WhatsApp conversations and deposit advices retrieved from D3's Mobile Phone.

17.  At the material time, D1 and D2 respectively conspired with D3 to deal with the property as particularised in charges 1 and 2, knowing or having reasonable grounds to believe that the said property represented the proceeds of an indictable offence.  D3 also conspired with “Ah Ho” to defraud such persons as might be induced to contact D3 or “Ah Ho” by making the false representations as particularized in charges 3 and 4.

18.  D1 aged 50, D2 aged 24, D3 aged 29, all of clear criminal record. 

19.  Mr Leung for D1 submitted that D1 worked as a cleaner at a hospital at the material time.  D1 was in debt and needed extra money, out of stupidity and greed, she committed the present offence.  From the mitigation letters submitted, her friends and colleagues described D1 as a diligent and dependable worker.

20.  Mr Leung further submitted that D1 was herself a victim of another fraudulent scheme where she suffered loss around $62,000, which was far more than what she earned, about $10,000 in the present case, and that matter had also been reported to the police.  As to the present offence, it is submitted that D1 had learned a harsh lesson, she only played a minor role and she did not know the underlying offence.  The amount involved was about $100,000 which was relatively small in similar cases.

21.  Mr Leung referred to similar cases like HKSAR v Liu Pong Hei DCCC 332/2019, HKSAR v Fong Chi Yam CACC 411/2017, HKSAR v Shamsudeen Syed Ahmed DCCC 947/2013 and HKSAR v Xie Jianwen DCCC 105/2014, whereupon in the range of 12 to 15 months’ imprisonment was imposed for cases involving similar figures.  D1 pleaded guilty at the earliest opportunity and she hoped for a lenient sentence. 

22.  Mr Wong for D2 submitted that D2 cohabits with her boyfriend and has a three-year-old daughter to look after.  Her father had been obsessed with gambling and the family financial conditions kept deteriorating.  D2 worked as a part-time saleslady and earn about $10,000 per month, yet she still insisted to give her mother about $6,000 to improve the tightened financial condition due to father’s heavy debt problem.  This also made D2 in difficult financial state herself where she needed to borrow money and in debt, which leading to the commission of the present offence.

23.  Similar to D1, D2 did not know the underlying offence and she received deposits on 7 occasions and was instructed to deal with them accordingly, she received only $6,000 in total where she is now willing to make compensation of that amount to PW2. 

24.  Mr Wong further submitted that after her arrest, D2 had attended a controlled delivery operation which successfully led to the arrest of D3.  D2 has since worked very diligently and had got promoted to assistant manager in a restaurant.  It is hoped that a second chance may be given to her where a community service order may be considered. 

25.  And further, as also submitted by Mr Leung for D1, Mr Wong also said that there may be undue delay on the prosecution, where the arrest was made in about mid-2018, it took about 3 years till July 2021 that they were all charged of the present offences.

26.  As to the appropriate sentence, Mr Wong referred to HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545, which stated that the starting point of 3 years’ imprisonment may be appropriate where the sum involved about 1 to 2 million.  Then Mr Wong tried to make simple arithmetic calculation to say that the present case for an amount about $100,000, therefore about one-tenth equivalent, maybe say about 3 to 4 months could be imposed.  Mr Wong also referred to HKSAR v Shek Man Ho DCCC 1114/2016, which CSO and probation may also be imposed for the similar offences. 

27.  Finally, her boyfriend and mother also submitted a mitigation letter saying that D2 is a very responsible and great mother and very hardworking staff, D2 had fully rehabilitated and if a noncustodial sentence may be imposed. 

28.  Ms Li for D3 submitted that D3 had worked as a waitress and also a saleslady, but then unemployed about 8 months before committing the present offence.  As she had used up her savings and tried to earn quick money, by then she was recruited by “Ah Ho” to deal with all these transactions.  In total, she profited about $100,000, but she had already used up all for her living expenses. 

29.  Ms Li further submitted that the scheme was not sophisticated and no international element involved, D3 was not the mastermind but only acted as instructed.  Ms Li also referred to a number of cases and suggested that for the total amount involving about $200,000 and perhaps not more than 3 years’ imprisonment should be imposed in aggregate. 

30.  As to the charge of conspiracy to defraud, although D3 was actively involved, the plan was not complicated nor in large scale, and perhaps 3½ years’ imprisonment could be adopted as starting point for all these cases. 

31.  Lastly, Ms Li also stated that there was undue delay on the part of prosecution and maybe a further discount could also be made accordingly. 

Discussion

32.  Money laundering and conspiracy to defraud are both serious offences.  The Court of Appeal in HKSAR v Boma [2012] 2 HKLRD 33 stated that the following matters should be considered by the court when sentencing, such as the nature of the predicate offence; the state of the offender’s knowledge; whether there is international dimension; the sophistication of the offence including the degree of planning; whether the offence was committed by or on behalf of an organised criminal syndicate; whether there was one transaction or many and the length of time over which the offence was committed; whether the offender continued to launder after discovering the nature of the funds; and the role of the offender in the acts performed by him. 

33.  And as stated above in Hsu Yu Yi case, starting point about 3 years were imposed for amount of money laundering between 1 million to 2 million.  However, Mr Wong made simple arithmetic approach to suggest that maybe about 3 to 4 months’ imprisonment be appropriate for the amount of about $100,000.  That simply cannot be accepted, especially comparing to quite a number of other cases where the range of about 12 to 15 months’ imprisonment may be more appropriate for the sum of money involved. 

34.  Having considered the respective roles played by D1 and D2 in charges 1 and 2, the amount involved on each was about $100,000, the period of charges 1 and 2 were about 6 to 8 months and in fact quite a number of transactions had been done by D1 and D2 actively in each charge.  Despite the fact that there is no evidence that D1 or D2 knew about the underlying offence, their involvements were crucial.  I therefore assess that for D1 and D2 in charges 1 and 2, starting point of 12 months’ imprisonment should be imposed which can then be reduced to 8 months upon guilty plea. 

35.  However, D2 actively attended a controlled operation leading to the arrest of D3, where an overall 50% deduction may be made.  So therefore, for D2 on charge 2, that may be further reduced to 6 months’ imprisonment. 

36.  The circumstances, of course, are different to D3 who knew about the overall arrangement, and I will adopt 18 months’ imprisonment for each charge 1 and charge 2 for D3 and that be reduced to 12 months’ imprisonment upon guilty plea for these two charges. 

37.  As to the offence of conspiracy to defraud, no doubt D3 had been actively involving in arranging the whole transaction, which can be seen from the WhatsApp messages between D3 to D1 and D2 respectively.  I adopt a starting point of 3 months’ imprisonment for each charges 3 and 4, and that be reduced to 2 years’ imprisonment upon guilty plea.

38.  As to the delay, there have been about 3 years since the arrest in July 2018 till all defendants be charged in July 2021.  Prosecution has submitted a chronology of events for the court’s consideration.  No doubt the investigation involved ID parade by victims, bank and computer work were to be taken and investigated, that would be quite time consuming.  Understandably all work may also be lengthened given the enormous social events happened in those years. 

39.  However, I take the view that an overall 3 years before charge to be laid down would be quite a delay and I accordingly assess that a deduction of about 2 months of the overall sentence for each defendant is appropriate. 

40.  Finally, for D3’s overall sentence, considering the totality principle, I assess that an overall sentence of 2½ years’ imprisonment be appropriate after all the deduction be made. 

41.  So therefore, for charge 1, D1, 8 months’ imprisonment minus 2 months’ delay discount, so the final sentence for D1 on charge 1 is 6 months’ imprisonment.  D3, 12 months minus 2 months’ delay discount, that will come to 10 months’ imprisonment. 

42.  For charge 2, D2, 6 months’ imprisonment minus 2 months for deduction, so the final sentence is 4 months’ imprisonment.  And D3, 12 months’ imprisonment minus 2 months’ discount, so 10 months’ imprisonment for charge 2 for D3. 

43.  And for charge 3 and charge 4, D3, each 2 years’ imprisonment minus 2 months’ discount, so each 22 months for D3 on charge 3 and charge 4 accordingly. 

44.  And finally, considering the totality principle for D3, charge 1 and charge 3 be run concurrently; charge 2 and charge 4 also be run concurrently, of which 8 months be made consecutive to charge 1 and charge 3.  The overall sentence for D3 be 22 months plus 8 months, so 2½ years’ imprisonment.

45.  And lastly, by consent of D2, a compensation order be made for D2 to pay PW2 $6,000, that could be made within 1 month and could be deposited to the court for further transfer to PW2. 

46.  So for D1, final sentence, 6 months’ imprisonment.  For D2, 4 months’ imprisonment.  For D3, overall sentence 2½ years’ imprisonment.