HKSAR v. ZHOU JIANLIN

DCCC 435/2020

[2020] HKDC 1090

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 435 OF 2020

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REASONS FOR SENTENCE

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1.  This is a case of money laundering. The proceeds of crime, as the prosecution put it, originated from a romance scam; the role played by the defendant, a Mainlander, was setting up stooge accounts under his name through which the proceeds were to be laundered.

2.  What is a romance scam? Put simply, it is when a criminal tricks someone into parting with their money after having built a relationship with them online.

3.  Here in the instant case there are at least four known persons, all women of different nationality (Pilipino, Thai, USA and Taiwanese), falling victim to such a scam. They were deceived into sending money (in some cases over a million) to different bank accounts, some of which found their way into the two bank accounts held by the defendant with the local banks (the Industrial and Commercial Bank (ICBC) and Hong Kong Bank), each account formed the subject matter of charges 2 & 3 respectively of conspiracy to deal with proceeds of an indictable offence[1].

4.  As it turned out when the defendant opened the bank account with ICBC, he had used a false credit card statement of China Construction Bank as a supporting document, which formed the subject matter of charge 1 of using a false instrument[2].

5.  The defendant, aged 45, pleaded guilty before me to all three charges.

6.  The defendant opened the two bank accounts on the same day, i.e. 30 May 2018. Within a period of 11 weeks between 30 May 2018 and 22 August 2018, there were a total of 21 deposits into the ICBC account totalling HK$255,114, USD$351,463, AUD$23,489 and SGD$26,867 (equivalent to approximately HK$ 3.29 million) and 22 withdrawals totalling HK$ 19,300 and USD$394,779 (equivalent to approximately HK$ 3.13 million). All withdrawals were conducted by way of online transfer on the same day or next day of deposit.

7.  Insofar as HSBC account was concerned, within the same period of time, there were a total of 15 deposits into the account totalling HK$15,939, USD$43,950 and CAD$164,994 (equivalent to approximately HK$ 1.33 million) and 13 withdrawals totalling HK$ 5,400 and USD$170,210 (equivalent to approximately HK$ 1.34 million). Again, the money deposited was transferred out of the account within a relatively short period of time, namely on the same or next day.

8.  As a matter of fact, most, if not all, of the monies from the scam were quickly siphoned off out of the jurisdiction via telegraphic transfers or by way of online transfers.  

9.  The defendant was arrested by the police at the ICBC branch in North Point for money laundering on 22 August 2018, and he was arrested again when he was entering Hong Kong about one year later on 5 September 2019.  Apparently, he was allowed to move in and out of Hong Kong during this time despite the fact that he once failed to answer police bail.

10.  He told the officers that sometime in May 2018 in Shenzhen, someone called Chen had asked him to come to Hong Kong to open bank accounts to obtain loans by pretending to be a rich businessman to which he agreed.  As he needed money to start his own business, he was promised a big loan of 1 to 2 million if everything went well.

11.  He was then accompanied by two men, whose names were particularised in the conspiracy charges, to the banks and after the establishment of the accounts, he handed over to them all documents relating to the accounts such as ATM card, online token and the password.

12.  Basically, what he was saying was that he allowed others the use of his accounts for whatever tricks they were up to. He told the officers that he had never used those accounts himself and did not know about any of the transactions going on in the accounts.   

13.  In mitigation, the court heard that the defendant, who had never had any trouble with the law before, worked as a car cleaner at a motor vehicle service centre in the Mainland earning about RMB$4,000 a month.

14.  The defendant is single and lives with his father (78) who had a stroke about a year ago, and during the current year he lost both his mother and elder brother one by one to cancer.

15.  In his letter to the court, the defendant put it down to his lack of education and poor legal awareness for the commission of the offences, and expressed his remorse for what had happened. He emphasized that he benefited nothing from the whole scenario.

16.  Mr Leung, a friend of the defendant, described him in the letter as someone who would not haggle for every penny but value relationship over personal gain.

17.  Pastor Lam from Christian Prison Pastoral Association said in his letter that based on his observations, the defendant after committing the offence did not give up, and took the initiative to seek assistance from the church and pastor, and determined to make a change. The defendant also promised to firmly trust in the Lord in the days to come. Pastor Lam said the defendant proved to them with his actions that he was really determined to correct from his mistake. 

18.  Finally, counsel for the defendant, Mr Cheng, submitted that all three offences were committed during a relatively short period of time and for the same purpose which may be viewed as being “part and parcel” of one crime, so that the court may consider a concurrent sentence.  

19.  True to say that there is no evidence to suggest that the defendant knew about the predicate offences, but surely he must have known these people using his accounts were up to no good.

20.  It may be argued that his role was minor in the scammers’ scheme of things, but it was in my view significant for without him setting up the accounts in the first place, the scammers’ plans could never get started.

21.  The money passing through the ICBC account and HSBC account amounted to approximately 3.13 million and 1.34 million respectively. Clearly these monies came from different parts of the world as evidenced by the deposit of different currencies and the involvement of victims of different nationality, and this international element aggravated the matter.

22.  Additionally, it is worth mentioning here that the various victims in the instant case have suffered substantial losses because most of their money have not been recovered.  

23.  There are no tariffs for offences of money laundering, but the higher court did provide a list of factors to be considered on sentencing such as those expressed in the case of Boma CACC 335/2010 (it is not meant to be an exhaustive list), the key factors include the amount of money laundered, whether or not the defendant knew about the predicate offences, the frequency and the duration of laundering activities etc.  

24.  Coming back to the instant case, the defendant, a Mainlander, who came to Hong Kong clearly for no purpose other than committing crimes.

25.  Given the facts of the case and based on what was said above, I take as the starting point 9 months, 3 years and 2 years for charges 1, 2 and 3 respectively, and reduce each by one-third to reflect his timely pleas, the sentence for each charge is as follows:

Charge 1: 6 months;

Charge 2: 2 years;

Charge 3: 16 months.

26.  Defence counsel, Mr Cheng, contended that the three offences were part and parcel of the same transaction and therefore asked the court to pass wholly concurrent sentences. It might well be said that was part of the same scheme, but certainly in terms of overall criminality, it was more serious than that of a single offence situation. For example, two offences of money laundering must involve more money than that of a single one in the same case, and the amount to be laundered is one of the key points in the determination of the sentence.

27.  Now turning to the totality principle, I order that charge 2 be run consecutively to 8 months of charge 3, and one month of charge 1, the rest concurrently. The total term is one of 33 months’ imprisonment.