HKSAR v. FOO CHUN PONG

DCCC 648 & 948/2017 (Cons)

DCCC 715/2018

(Heard together)

[2020] HKDC 45

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 648 & 948 OF 2017

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IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 715 OF 2018

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Reasons for Sentence

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1.  Two defendants today. The 1st defendant in respect of two separate cases. The first case being two indictments which are consolidated, that is namely 648 and 948 where he faces totally 11 charges relating to theft and fraud committed over a period between 21 February 2013 and 9 December 2014 relating to various thefts and frauds committed at fitness centres and gyms that he was working at and relating to payment for such items as membership fees and obtaining of loans.

2.  The second indictment is number 715.  That involves again the 1st defendant and the 3rd defendant.  This indictment contains two charges of conspiracy to defraud and five further charges relating to possession of identity documents both genuine and forged which were used as part of the frauds set out in Charges 1 and 2.

3.  The 1st charge in 715 represents a conspiracy to defraud carried out by the engine of a company called Compass Capital Trading and Universal Hong Kong Industrial Limited.  And the basis of the frauds is they would offer low interest financial arrangements from the local registered banks.  These would be extended to the victims.  Various false representations were made to obtain security monies from the victims which were used to collateralise the loans, the basis being that the low interest rates would be given to the victims and the security monies would be refunded to them.

4.  The 2nd charge of conspiracy to defraud relating to the 1st defendant here involving companies of Jumpstart Business Trading, Capital Trading and WanTat Capital Trading.  Again, the same modus operandi of falsely representing low interest loans and financial arrangements could be made from various registered banks.  Various sums of security money had been obtained to collateralise the loans on the basis that they would be repaid once the loans had been obtained, and this of course caused a number of victims, whose identities are set out in the indictment, to pay the security monies.

5.  The remaining charges relating to the identity cards are formed on the basis of evidence obtained during searches.

6.  And there are highly detailed Summaries of Facts in relation to both sets of cases.  I do not propose to set them out in any detail at all, but I do refer to them and the full facts I am sentencing on can be obtained from reading them.

7.  I am primarily concerned with the sophistication of the frauds, the length of time they operated over, the amounts of monies obtained during the course of these fraudulent activities and the extent and size of the operations.

8.  Just in summary, from the information helpfully provided to me by the prosecution, the total amount found within the fraud charges of 648 and 948 is $1,284,696.  For the theft charges in that case, the total is $477,917.  The loss for each victim can be found from the indictment.

9.  As far as the second case, which is 715/2018, is concerned, the total losses of the victims in the 1st charge is $16,900,250. The total loss in the 2nd charge is the sum $20,019,450.  Thus, the total amount in both of the first two charges is in excess of 38 million combined with the earlier figure I had given in relation to the other case of 648 and 948.  That would set out the overall total financial losses for the theft, fraud and conspiracy to defraud charges in these two different cases, and that of course would be the figure that the court will be looking at when looking at the overall total sentence in respect of these, certainly the theft, fraud and conspiracy to defraud charges.

10.  I am informed in fact that the total amount in 715 for the 1st defendant is $38,682,313.  The 3rd defendant was also involved in the 1st charge of 715/2018.  He was involved in introducing a victim to the scheme during the course of a 15‑minute-odd long conference.  The losses to that victim were HK$790,000.  There are of course a number of other victims in relation to the 1st charge, but the 3rd defendant’s involvement in the 1st charge on 715/2018 is limited to that victim.  There is no evidence of his wider involvement in that conspiracy.

11.  Now turning to what I know about the individual defendants.  The 1st defendant at the time of the preparation of antecedents was 29 years old, educated I am told to Form 5 level.  The defendant has the history of driving offences.  They bear little relevance to these offences.

12.  As far as the 3rd defendant is concerned, what I know about him is he was, at the time of the preparation of his antecedents statement, was 24 years old.  He has previously worked as a construction site worker and he had been convicted in the past, in 2013, for the offence of trafficking in a dangerous drug for which he was sentenced to 3 years and 6 months’ imprisonment.  Again, an offence of a completely dissimilar character to the one I am dealing with today.

13.  Mitigation has been submitted on behalf of both defendants.  In essence, I am asked to approach their cases with leniency.

14.  As far as the 1st defendant is concerned, it is submitted he acknowledges his wide criminal involvement in these offences between 2013 and 2017.  It is said that he has admitted the full extent of his criminality in these matters and shown remorse.

15.  As far as the 3rd defendant is concerned, he was convicted after trial but it is asked that his sentence reflect the involvement proved in this conspiracy to defraud and is limited to the preparation of a victim for entry into the fraudulent engine as it were.

16.  I turn to the approach to sentence.  In respect of the charges of theft, fraud and conspiracy to defraud, there is no guideline sentence.  The sentence imposed by the court is broadly given to the court in a wide discretion.  The offences themselves are too widely varied for there ever to be a guideline sentence.  Nevertheless, the sentence should reflect the sophistication and the size of the scheme, the length of time over which it is perpetrated, the amount of money obtained by the fraudulent schemes and thefts and the defendants’ involvement.  The 1st defendant also faces some charges in relation to immigration offences and I will deal with him when I come to sentencing for those matters.

17.  At this stage I will proceed to sentence now on the charges firstly for the 1st defendant.  As I said before, this defendant faces a large number of charges to be dealt with.  He is entitled, from his early indicated plea of guilty, to a full one-third discount in respect of each charge.  What the court is obliged to do is to ask what is considered to be a correct sentence on each charge, then calculate what the overall totality of sentence should be for all the offences and then adjust the way in which the sentences are served by running them consecutively or concurrently, or partly consecutively, or partly concurrently to arrive at the correct overall total. That would obviously involve at some point a calculation of the correct overall starting point for sentence.

18.  Given the extent and amount of money involved in all these offences, it is clear that that starting point may well exceed the jurisdictional limit of this court.  The court is entitled to adopt a starting point that is in excess of its jurisdictional limit, but the court must ensure that the defendant receives a significant discount from the jurisdictional limit of the court and it has been said that that must be at least 1 year from the jurisdictional limit.

19.  What I am going to do in respect of the 1st defendant is indicate the sentences I will impose on each charge separately.  I will briefly mention the amount of money involved in these charges and then I will indicate the sentence after deduction of the one-third discount, and then finally I will do the calculation in relation to the overall sentence.

20.  Turning to 648 and 948, the fitness centre thefts and frauds committed between 21 February 2013 and 9 December 2014.  The amounts obtained in each of these 11 charges differ and obviously the starting points and finishing points of sentence will differ according to the amounts obtained, but the overall total must reflect the 1.7-odd million obtained in the course of those thefts and frauds.

21.  After deduction for the plea of guilty, the sentences will be as follows: Charge 1, 10 months’ imprisonment; Charge 2, 12 months’ imprisonment; Charge 3, 10 months’ imprisonment; Charge 4, 20 months’ imprisonment; Charge 5, 14 months’ imprisonment; Charge 6, 14 months’ imprisonment; Charge 7, 20 months’ imprisonment; Charge 8 and Charge 9, 8 months’ imprisonment each; Charge 10, 10 months’ imprisonment; and Charge 11, 14 months’ imprisonment.

22.  I have decided for these offences the total overall sentence should be one of 28 months’ imprisonment and I will order that by ordering that Charges 1 to 10 run concurrently and that 8 months of Charge 11 runs consecutively to 1 to 10.

23.  As far as the second case, that is 715, this involves the two conspiracy to defraud charges and the other charges related to the immigration offences, these frauds taking place between 31 July 2017 and 16 December 2017.

24.  On Charge 1, where 16.8-odd million was obtained, I will take a starting point of 60 months’ imprisonment, reduce that to 40 months’ imprisonment for a plea of guilty.

25.  On Charge 2, where some 20-odd million was obtained, I will take the same starting point of 60 months’ imprisonment, reduce that to 40 months’ imprisonment for the plea of guilty.

26.  As far as the remaining five charges are concerned, these relate to possession of identity cards and forged identity cards.  Sentences can range between 12 to 15 months’ imprisonment for these charges.  So on Charge 3, he will be sentenced to 8 months’ imprisonment; on Charge 4, a sentence of 8 months’ imprisonment; Charge 5, a sentence of 10 months’ imprisonment and Charge 6 a sentence of 10 months’ imprisonment; and on Charge 7, a sentence of 8 months’ imprisonment.  I have got to determine the overall total for all these offences. 

27.  Having regard to the sophistication of the offences and the time over which they were completed, I have determined that a starting point in excess of my jurisdictional limit will be used.  I will take an overall starting point of 7½ years’ imprisonment which would lead to - and after deduction for the plea of guilty, a one-third deduction - would lead to a final sentence of 60 months or 5 years’ imprisonment.

28.  I would achieve that by making the following order: I am going to order that on 715, Charges 1 to 7 be served concurrently, but that would require then that 32 months of the sentences on 715 be served consecutively to 648 and 948.  I will also order that the criminal bankruptcy orders sought by the prosecution are properly sought and will be made.

29.  I turn now to the 3rd defendant’s sentence.  He simply faces sentencing on one aspect of the 1st charge of conspiracy to defraud in the case 715.  As I said, his role is limited.  The total amount of money was $790,000.  What I should do is impose a sentence of 15 months’ imprisonment on the 3rd defendant on that charge.