HKSAR v. FAN YU HIN

DCCC 717/2023

[2024] HKDC 494

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 717 OF 2023

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REASONS FOR SENTENCE

The defendant faces a charge of "Conspiracy to defraud" (Charge 1)  and a charge of "Money laundering" (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.  Mr. Wong (PW1; aged 85)  had a Chinese medicine clinic situated at Ground Floor, Lung Mun Oasis, Tuen Mun ("the Clinic").

3.  About 11:00 a.m. on 13 March 2023, PW1 received a phone call made to the Clinic.  A male voice (Male 1)  pretending to be PW1's son-in-law claimed that he was in need of $70,000 cash as bail money.  PW1 said he only had $34,000 ("the Cash").  Male 1 told PW1 that someone named "Ming Jai" would go to the Clinic to collect the money.

4.  About 11:50 a.m. on the same day, the defendant appeared at the Clinic claiming to be Ming Jai.  PW1 asked the defendant about his relationship with PW1's son-in-law.  The defendant said PW1's son-in-law was his friend and he was there to collect the bail money.  PW1 then gave the Cash to the defendant.

5.  PW1 later received a phone call from Male 1 asking for a further sum of $100,000 as compensation money. PW1 said he did not have enough money.  PW1 then contacted his daughter and discovered that it was a scam.  The Police was alerted.

6.  DPC 28330 arrested the defendant on 14 March 2023.  Under caution, he claimed that Leung Lung San instructed him to collect the money; the entire sum collected was given to Leung.

7.  In his video recorded interview, the defendant described how he met Leung in a bar about 1 to 2 months ago and how he accepted a "quick cash job" offered by Leung. The defendant explained what Leung had told him to do.  He admitted how he went to the Clinic to collect money from PW1.  As instructed by Leung, the defendant deposited $32,000 into certain Alipay accounts.  He then received $1,000 for completing the job. 

Mitigation & Sentence

8.  The defendant is 23 and single. He has 6 conviction records, which are unrelated to dishonesty.  Defence counsel Ms. Ho informed me that the defendant's parents have passed away in 2010 and 2022 respectively.  He needs to look after a 5-year-old stepsister. The defendant has worked as a waiter and a transportation worker before.

9.  In mitigation, Ms. Ho submitted that the defendant has been remanded in jail custody for a year. During that time, his girlfriend helped looking after his stepsister.  Ms. Ho stressed that the defendant is truly remorseful and is determined to turn a new leaf.  He wants to lead a normal life so that he could look after his stepsister.

10.  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 offences.  Ms. Ho did not object to the application for enhancement.

11.  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]."

12.  I have read the witness statement of DCIP Tang dated 14 March 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.

13.  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).

14.  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.

15.  The defendant claimed that he did not take part in or had any specific knowledge of the underlying phone deception; however, the scam would have been meaningless without a willing "collector".  Given the role played by the defendant, the amount involved and the overall circumstances, I grant the prosecution's application and will enhance the sentence by 20%.

16.  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]

17.  In determining the proper starting point, I have reminded myself of the sentencing principles laid down in HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545 and HKSAR v Boma Amaso [2012] 2 HKLRD 33. 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.

18.  In SJ v Ngai Fung Sin Apple [2013] 5 HKLRD 104, Yeung V-P held :-

Generally speaking, the sentence passed in a "money laundering" case is primarily to reflect the amount of the "illicit/black money" involved. Neither the fact that the "illicit/black money"was actually not derived from an indictable offence nor the defendant's ignorance of the actual source of the "illicit/black money" is necessarily a valid mitigating factor…[3]

19.  In the present case, the defendant admitted that he went to the Clinic to collect the Cash from PW1.  For the purpose of sentencing, I accept that he probably had no specific knowledge of and did not take part in the phone deception against PW1.  To this extent, his culpability is perhaps less than the perpetrator(s)  of the underlying phone deception[4].

20.  I have borne in mind the amount of money involved in   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 20% enhancement, I sentence the defendant to 24 months' imprisonment for this charge.