HKSAR v. WONG SAI KUI WILSON AND ANOTHER

DCCC 923/2022

[2025] HKDC 1148

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 923 OF 2022

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REASONS FOR VERDICT

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1.  D1 to D3 are jointly charged with a single count of Conspiracy to Deal with Property Known or Believed to Represent Proceeds of an Indictable Offence, contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap 200. It is alleged that they had, between 30 October 2017 and 30 April 2018, conspired together to deal with US$825,946 in the bank account under the name of Funson Trading Limited with Dah Sing Bank Limited, knowing or having reasonable grounds to believe that the said amount of money, in whole or in part, directly or indirectly represented proceeds of an indictable offence.

2.  D1 pleaded guilty before me, and had been called as PW1, pending sentence.  The present verdict therefore only deals with D2 and D3 who had pleaded not guilty to the charge.

Admitted Facts and Areas Not in Dispute

3.  In the Admitted Facts (P35), the arrest of D2 and D3, as well as the voluntariness of the VRIs of D2 and D3 are admitted.  The chain of exhibits is not disputed, which includes that of D2 and D3’s mobile phones and SIM cards.

4.  Although the admissibility of the WhatsApp messages found in D1 and D2’s mobile phones are not challenged, the Prosecution only relies on those in P28 (P28A certified translation).  D2 in his evidence maintains that the messages shown to have been sent by his phone number were not all sent by him, and could possibly be sent when he was outside Hong Kong by his staff who had left service.

5.  D2 and D3’s ID are also not in dispute.  It is also admitted that D1 positively identified D2 as Nam Gor, the responsible person at an ID Parade held on 15 May 2019.

Prosecution Case

6.  The Prosecution called D1 as the only witness.  In her evidence, she states that she is 28 years old, and had received associate degree education but had not been able to complete the course.  She is at the time of the evidence an assistant puppy walker.

7.  She states that in September 2017, she was in debt of about $100,000 from credit card and financial institutions debts and had ceased her studies. She took up part time jobs but the salary was low.

8.  In September or October 2017, she started looking for jobs on Facebook and IG, and through her elder sister Lam Man Sze who was also looking for work.  Her elder sister arranged a meeting with a woman named Lala for a job as wedding witness.

9.  At the meeting between D1, her elder sister and Lala, Lala obtained personal information of the sisters, and came to know that the sisters were in debt.  Lala informed them that there were no more vacancies for wedding witnesses, but she could help them look for other job opportunities from colleagues.

10.  There was also another occasion where Lala and 2 males came to visit D1 and her elder sister in Tuen Mun (hereinafter referred to as ‘the Second Meeting with Lala’).  D1 did not know the purpose of the visit.  The sisters boarded the vehicle driven by the other party.  It was mentioned in the journey that the sisters were in debt.  One of the males said that since the amount of D1’s debt was small, it could be easily settled.  It was mentioned that a job of opening company accounts is available for the sisters, and that $1,000 would be the remuneration for each account successfully opened.  The sisters’ contacts were asked for, they signed on a piece of paper, and their ID card copies were collected by the other side.  Lala did not speak much.  After having a meal, the other party drove the sisters home.

11.  Upon the introduction of the group of people including Lala and the 2 males, a meeting on 3 November 2017 was arranged between the sisters and a male called Nam Gor (D2), who D1 said was the responsible person.  Before the meeting on 3 November 2017, D2 called D1 and confirmed D1’s name and that she wanted to take up the job of opening accounts.

12.  During the meeting, D2 gave a big bundle of documents (including a pile of company names) to D1, saying that they were company information, and asked D1 to read and memorize the information such as the business of the company, for the purposes of opening company accounts.  D2 told D1 that the bank would ask her about the nature of the business and the amounts that would be moved into and out of the company accounts.  Her initial understanding was to open USD company accounts, but later on she came to know that it was in fact accounts that have online banking transfer functions.

13.  D2 mentioned the names of the companies that needed accounts to be opened, one of which was Funson Trading Limited (hereinafter referred to as “Funson”), and said that D2 had to open these accounts, and later on the accounts would be transferred to the companies.  D2 mentioned that D1 would be paid $1,000 for each company account successfully opened.  He also mentioned that there might also be future work opportunities.

14.  After reading the company documents given to her, D1 went to Dah Sing Bank in Wan Chai, and then Dah Sing Bank in Causeway Bay, for the purposes of opening company accounts. One of the accounts was for Funson, and she could not remember the name of the other one.

15.  On 3 November 2017, at the Wan Chai branch of Dah Sing Bank, D1 gave the pile of company documents and her ID card to the bank staff, and was asked by the bank staff to fill in some information, including her email address and mobile telephone number.

16.  On the same day at the Causeway Bay branch of Dah Sing Bank, D1 opened a bank account for Funson.  Documents were given to her by the bank staff, and she passed them to D2, mistakenly leaving her ID card inside the pile of documents.

17.  On that day D1 and her elder sister were opening accounts at different counters of the same branch.  When they had finished the relevant procedure, they would leave the bank and join D2 nearby.  D2 and the sisters discussed about the possibility that the bank staff might call and followup.  D1 understood that she would only receive $1,000 per account as remuneration if the account was successfully opened.  After the discussion, they parted ways.

18.  D1 was involved in similar arrangements for opening of company accounts for a few months.  Every time there would be prior arrangements with the bank before D1 attended the bank for the account opening.  The communication between D1 and D2 after 3 November 2017 took the form of whatsapp, phonecalls and face to face meetings.  She had met D2 not more than 10 times after 3 November 2017.

19.  She had received calls from bank staff concerning the bank accounts that she had opened on the instructions of D2, and passed on messages from banks concerning requests for bank transfer documents, depositing money into accounts and other matters concerning opening of bank accounts.  The documents were all prepared by D2, and she did not have a clear understanding of what they were. She was merely responsible for submitting the documents to the bank.

20.  When D1 realized that she had left her ID card with the documents from the bank with D2, she whatsapped him trying to get the ID card back for work. They arranged to meet the following day.

21.  The meeting took place a few days after 3 November 2017, in either Wan Chai or Causeway Bay.  She got back her ID card.

22.  After that, when bank staff informed her that further documentation is required, she contacted D2.  D2 asked D1 to send her signature and email address, so that documents can be sent to her.  She had also met D2 during that period of time, but she could not recall the exact date.

23.  In January 2018, D1 was asked to attend Causeway Bay Dah Sing Bank to complete the procedure for setting up online banking or USD account of Funson. After the USD account of Funson was opened, bank staff gave her some information and she in turn passed those to D2 at Hysan in Causeway Bay.

24.  For the first company account opened by her, she wrote her home address as the correspondence address due to inexperience.  She cannot recall the address that she provided for the later company accounts opened by her.

25.  The bank cards of the company accounts opened by her were not sent to her.  Even though she had no idea whether the bank cards were sent directly to D2, D2 called her concerning those accounts and said that the bank cards had been received, so that she would not have to follow up with the bank.

26.  After the said visit in January 2018, D1 did not contact Dah Sing Bank anymore.  She responded once to D2 after the said visit.  In late January 2018, D1’s family members paid off her debts, and she did not want to be involved with D2 anymore, therefore she did not pick up D2’s phonecalls nor respond to his whatsapp message (Counter 942, p 17 of P28, 15 February 2018).  After 15 February 2018, there were no further messages between her and D2.  She did not have any contact with Lala since she met D2.

27.  A few months after the USD account was opened for Funson, D1 received an SMS stating that a large sum of money had been deposited into the Funson account, whereupon she realized that “there might be a problem”.  She was afraid to contact D2, and therefore forwarded the SMS to her sister, asking her elder sister to forward it to D2.  According to her understanding, her elder sister did as requested.

28.  She testified that her telephone number at that time was 54509099, and she had not allowed anyone to use that number.

29.  She was arrested in 2019, and had positively identified Nam Gor at an ID parade in 2019.

D2’s VRI

30.  D2 stated in his VRI that he had met D1 on 2 to 3 occasions in late 2017 in order to provide service to bring D1 to Dah Sing Bank to open 2 company accounts.  She was referred to him by D3 (Petrick/Patrick Chan) from an accounting firm, who had clients wishing to open such bank accounts.  He did not know if it was D3 who asked D1 to open the account.

31.  He arranged a date to meet D1 outside the bank, and bring the company documents to her which would be used for the account opening procedure.  He would wait somewhere and not enter the bank with D1.  After D1 finished opening the bank accounts, he took the company documents from D1, and will bring them to her again if it is required to go to the bank again.  In case supplementary company documents are required, D2 would also provide that to D1.

32.  After the account opening is completed, D2 would pass back the company documents to D1, and would not keep them any further.

33.  He stated that when the bank had vetted and approved the opening of the company account, he would then be paid HK$10,000 per account by D3 as reward. He denied having given money to D1.

34.  In the VRI, he also admitted that he did not ask D1 how she intended to use the company accounts.

D3’s VRI

35.  D3 stated in his VRI that he was a corporate consultant who had set up his company Chong Fung (transliteration) Business Company Limited (hereinafter referred to as “IBBA”) in 2004.  The Company provides secretarial services, and its main business includes assisting clients to open limited companies, receiving phonecalls and letters for clients, providing registered address, some accounting work, tax returns filing, auditing services, trademark registration, applying for financial licences, and referring clients to open company accounts.

36.  Where it is confirmed that clients would like to open a company bank account, IBBA would refer the clients to intermediary companies who can help clients open these accounts successfully, as the intermediaries have direct contact with the bank staff.  For different banks, intermediary companies charge different fees.  On top of that, IBBA would add HK$3,000 as IBBA’s referral fee.  IBBA would charge the clients the full price which includes the intermediary’s fees and IBBA’s referral fee.

37.  The documents will be sent by email or WhatsApp to the intermediary. Then the intermediary will read the documents and decide which client is more suitable for a particular bank.  The intermediary then make an appointment with the bank.

38.  After the company accounts had been successfully opened with the bank, D3 would pay the intermediary’s fee from the fee earlier paid by the clients.

39.  For existing clients of IBBA, application form for opening company accounts would be provided, and they would be forwarded to intermediary companies.  D3 would review the application, and depending on the nature of company business, different kinds of documents would be required by specific banks.

40.  For the present case, a “Mr Tsoi” (referred to as “Mr Choi” in IBBA’s records) called IBBA and said some staff members wants to open company accounts, and he had with him the company information of a dozen companies.  D3 did not know the definition of ‘staff members’.  D3 referred these companies to D2.  He prepared a table with a list of 4 companies with D1’s name listed as director and shareholder, and the registered address of each company, as the information of clients that requested for company account opening services, and sent the table to D2.  After the accounts had been opened, the name of the bank and the date of account opening would be recorded in the table.  The banks were suggested by and appointments were made with the banks by D2.

41.  As Mr Tsoi was not originally a client of the Company, D3 merely referred him to D2, and did not keep any of the company documents, save as glancing through them briefly.  The company documents would be handed over by those with the companies directly to the bank, or to the intermediary D2.

42.  D3 communicated with Mr Tsoi through WeChat.  He did not keep the information of Mr Tsoi, as he did not know if Mr Tsoi was the boss of those companies, and Mr Tsoi was only a contact person at the time.  D3 thinks that there is no need to ask for Mr Tsoi’s ID card, residential proof and other personal documents as Mr Tsoi was not the person who would be opening the bank accounts.  D3 does not know the real boss behind those companies.  He is of the view that it was the owners of the 4 or 5 companies mentioned by Mr Tsoi who wanted to open bank accounts.

43.  He thinks, however, that Mr Tsoi was an important client, as he brought along a large number of companies, and he paid all fees quoted in full and in cash.

44.  He states that due diligence should be performed by the intermediary, and then ultimately by the bank.

45.  D3 stated that for D1 and her sister, whom he referred to as the “Slutty Sisters” in his correspondence with D2, each had 4 company accounts to be opened, and therefore a total of 8 companies as stated in the pdf file sent by him to D2 named Sister8.  He admitted he had sent the ID card copy of D1 to D2.

Defence Case

D2’s Evidence

46.  D2 elected to give evidence but did not call any Defence Witness.  He testifies that in 2012, he opened a finance company named Power Cash Finance Limited (hereinafter referred to as “Power Cash”).  As the finance company business in 2016 to 2017 was poor, and opening of company bank accounts was difficult at that time, he contacted an agent for opening company bank accounts named Tony in order to get into the business.  Tony had good relationship with many banks and therefore a higher success rate, and he introduced such business to D2.

47.  Tony indicated that most of his clients came from accounting firms. Since Power Cash’s accounts were handled by a person that D2 called “Accountant Chan” (D3), D2 contacted D3 and asked if D3 could refer any clients who wished to obtain services for opening of company accounts.  D3 agreed and indicated that he had been conducting this line of business.

48.  Upon referral by D3, D2 started providing service for opening of 2 company bank accounts for 2 companies with a British client in October 2017. He called Tony for arranging meeting with the bank.  Eventually Tony arranged D2’s client to open 1 account each at Citibank and DBS.  As Tony charged D2 $27,000, D2 added $6,000 as his own fees, and quoted the total figure of $33,000 to D3.  D3 agreed to the quote.

49.  Tony told D2 that bank staff would not allow agent’s presence at the opening of bank account with client, since sensitive information of the company would be asked at the meeting.

50.  D2 therefore accompanied the British client to the vicinity of the bank, and waited for client to come out after finishing the account opening procedure.  He then checked whether the documents taken out of the bank make a complete set, and kept them for the client, in case the bank requests documents to be faxed again, when D2 can help the client as part of his services.

51.  About 3 weeks later, D2 came to know that the client’s company accounts with Citibank and DBS were both successful.  He therefore returned the set of documents to the client.  Payment was made by D3 to D2 on 23 October 2017 (D2-1 Payment Record).

52.  D2 first heard of Mr Choi in about October 2017.  D3 said that Mr Choi had lots of businesses, and needed to open lots of bank accounts.  D2 asked D3 what kind of business Mr Choi was involved in, whereupon D3 said there were many different kinds of businesses, including import and export, luxury watches, bags, and home decoration items, and those require opening of company accounts in order to facilitate normal business operation.  D2 asked to meet Mr Choi, however D3 said Mr Choi was the big boss and was too busy to meet D2.  D3 also mentioned that Mr Choi would ask nominees to open company accounts and D2 could meet those nominees directly.  Since D2 thought at the time that it was normal for nominees to hold companies for their boss, he agreed to take up the business related to Mr Choi.

53.  In order to complete the work relating to Mr Tsoi, D2 called another agent named Chirsty for help in contacting bank staff to open bank accounts.

54.  The nominees involved in the business with Mr Choi were Cheng Chun Ming (“Cheng”) in relation to 2 companies, and Choi Tai Cheung (“Choi”) in relation to 1 company.  He talked to the nominees about the nature of business, and after D3 agreed the quote he prepared based on his fees and Tony’s fees, he and Tony met the nominees at Tony’s office.

55.  Thereafter D2 went to the bank with the nominees on 2 separate occasions, checked that the documents required were there, and gave them the company documents.  He also reminded the nominees the questions that the bank staff would ask, e.g. the annual turnover, nature of business, whether there were insurance or MPF payments made for the employees.  He then waited outside for the nominees to complete the account opening procedure.  Afterwards he checked that all documents had been returned by the bank, and kept the documents as part of his service.

56.  Later on, Tony informed D2 that the said 3 accounts were successfully opened.  D3 paid D2 $47,500 (D2-2 Payment Record).  The documents were returned to the clients.

57.  Between October 2017 to early 2018, D2 worked with Tony and D3 concerning 4 clients unrelated to Mr Choi.  The manner of operation was similar to that mentioned above.  D2 was paid $17,000, $16,000, $20,000 and $20,000 for these 4 clients.  He was paid $17,000, $16,000, $20,000 and $20,000 by D3 for these clients (D2-3 to D2-6).

58.  Concerning Funson Trading Limited (hereinafter referred to as “Funson”), D3 whatsapped D2 on 30 October 2017, and mentioned 2 sisters whom D3 nicknamed “the Slutty Sisters”, who would act as nominees for 5 companies relating to Mr Tsoi.  Company accounts were to be opened concerning these companies.

59.  D2’s understanding was that the sisters were nominees of Mr Choi, and that they would receive payment.  But he has no information concerning the amount of payment to the nominees.

60.  On 2 November 2017, D3 whatsapped D2 with the ID card photos of D1 and her sister, their mobile telephone numbers and a pdf file named sister8company.  The pdf file contained information of the 2 sisters and the 4 companies that each of them would be opening accounts for.  The companies included Funson.  D2 had not heard of the 2 sisters’ names and telephone numbers before.

61.  D2 therefore called D1 using the telephone number stated in D3’s WhatsApp message.  He told D1 that he already had basic information about the companies, and asked if she wished to have company bank accounts opened for those companies.  After D1 replied in the affirmative, D2 confirmed with D1 that Dah Sing Bank is preferred.  A similar conversation between D1’s sister and D2 also took place.

62.  D2 then informed Chirsty of the basic information on the companies, and requested her to arrange meetings with the bank on 3 November 2017, Chirsty called back and said that she had arranged meetings with 4 Dah Sing Bank branches: Funson at Causeway Bay branch (with D1), Samson at Causeway Bay branch (with D1), Gangjin at Wanchai branch (with D1), and Panfoo at Wanchai branch (with D1’s sister Lam Man Sze).

63.  Chirsty charged $3,500 for each company.  D2 then called D3 to make a quote of $16,000 for Causeway Bay branch, and $16,500 for Wanchai branch.  D3 agreed to the quote.  D3 also sent D2 a WhatsApp message on 2 November 2017 (D2-10) asking him to contact a person called “Yin Yer” at a telephone number for the company’s documents for D1 and Lam Man Sze.

64.  D2 then arranged to meet D1 and Lam Man Sze on 3 November 2017 at the MacDonald’s at Causeway Bay.  He also called Yin Yer and arranged to meet at Causeway Bay MTR station the next morning.

65.  On 3 November 2017, D3 whatsapped D2 and asked D2 to take a photo of the signature of the sisters, so that the share transfer could be dealt with (Counter 1885 of P28).

66.  On 3 November 2017, D2 met Yin Yer and obtained company documents of the 8 companies.  Then he met D1 and Lam Man Sze at MacDonald’s near Percival Street.  After sitting down, he confirmed the identity of D1 and Lam Man Sze. Then he gave the documents that he had obtained from Yin Yer (ie the documents relating to Funson, Samson and Gangjin) to D1 and Lam Man Sze to read.

67.  D2 then reminded D1 and Lam Man Sze the questions that the bank staff would ask, ie nature of business, number of employees, any turnover, whether the companies made MPF and insurance payments for staff.

68.  D2 then went with D1 and Lam Man Sze to the Causeway Bay branch of Dah Sing Bank.  He gave the documents of Funson and Samson to D1, and D1 went inside the bank to deal with the account opening on her own.

69.  D2 then went to the Wanchai branch of Dah Sing with Lam Man Sze, and gave her the documents of Panfoo for the same purpose.

70.  D2 then went back to the Causeway Bay branch to meet D1, and checked with her outside the branch to confirm that all documents had been returned, whereupon D2 kept them for her as part of the service.  The 2 of them then went to the Wanchai branch together.  Outside the Wanchai branch D2 gave the documents of Gangjin to D1, and asked her to go inside the bank to open the company account.

71.  About 1 hour later, Lam Man Sze called D2 and said that she and D1 had finished the business at the bank.  D2 then went to the doorway of the bank to meet them, and checked if all documents had been returned.  He then kept the documents for the sisters, and told them that he would call them when there are further arrangements for other bank accounts.  He then left.

72.  On 7 November 2017, D1 whatsapped D2 and said that she had left her ID card inside the documents and requested to get it back for work.  They met and it was passed back to her. (D2-11 & D2-12)

73.  On 8 November 2017, D1 called D2 and stated that the bank called and said the share transfer agreement was not clearly printed. D2 called D3 about it, and D3 sent clearly printed documents to D2, for which D2 emailed them to D1 for onward forwarding to the bank.

74.  On 8 November 2017, D3 and D2 dealt with the manner in which share transfer documents of 6 companies relating to the sisters were to be emailed by D3 to D2.

75.  On 15 January 2018, D3 called and said that the USD account and online banking was not opened for Funson, and that Mr Choi would not pay.  D2 therefore called D1 and asked her to call Dah Sing Bank to open the USD account and activate the online banking function.  D1 said she had already called the bank about that.

76.  On 30 January 2018, $48,500 was paid by D3 to D2 for the opening of the Funson account. (D2-18).  From that amount, D2 paid Chirsty in February 2018.

77.  After 14 or 15 February 2018, D2 tried to contact D1, as only 3 out of 4 company accounts had been opened.  As the attempts were unsuccessful, D2 called Lam Man Sze to have D1 contact D2.

78.  On 30 April 2018, Lam Man Sze sent through WhatsApp a screen capture of a bank SMS concerning an online transfer of USD245,740 from the Funson account to an unregistered bank account.  D2 was happy as that meant the account was successfully opened and in use.  Lam Man Sze asked if salary was paid for the Funson account.  D2 replied not yet.  This is so even though $48,500 had been received, yet it only relates to 3 accounts, so payment for the 4th account had not been received.

79.  D2 has no idea why D3 whatsapped him on 7 May 2018 about the security device of D1 being blocked.  D2 stated that he had not received any security device concerning the accounts that he had assisted in opening.

80.  On 8 May 2018, in counters 6159 of P28 onwards, in the WhatsApp conversation between D3 and D2, D3 started with “So scary”, and D2 didn’t know what D3 was talking about.  In counter 6160, D2 mentioned that the sisters had not been paid yet, as he was afraid that they would reveal to Mr Choi that they had not been paid, and that might mean D2 and D3 would lose business. He did not think that there was anything suspicious in the messages, and he did not hear anything else about Funson or Mr Choi after that day.  He thought that was the end of the matter and there was nothing that aroused his suspicion.

81.  In counter 6161 of P28, the name Ah Hei was mentioned by D3.  D2 testified that he did not know Ah Hei.

D3’s Evidence

82.  D3 elected to give evidence but did not call any Defence Witness.  He testified that he owns a secretarial company named International Business Brokerage Advisory Limited (IBBA) providing services to companies.  IBBA’s licence issued by the Companies Registry, and copies of the audited accounts for the years 2017-2018 and 2018-2019 are exhibited as D3-1 to D3-2; D3-3 and D3-4 respectively.  Other people refers to him as “Accountant Chan”, but he is not an accountant.

83.  IBBA promotes business, inter alia account opening services, through its website, and advertisements on google and magazines (D3-21, D3-24 to D3-28). It also provides pricing tables on its website and flyers including the minimum referral fee for account opening services. (D3-20 and D3-22)

84.  IBBA has a list of clients for account opening services.  Mr Choi’s employees asked IBBA to open company accounts number 1 to 30 on the list.  No. 22 in the list is Funson.  The company address of Funson was its registered address, and not the address of IBBA, as Funson was not a company set up by IBBA.

85.  D1 became director of Funson on 1 November 2017, as can be seen in P20 Funson’s Companies Registry documents filed on 7 November 2017.  D1 was also the director and shareholder of the companies listed as no. 21 to 24 of the said list.

86.  IBBA had employed a part time staff Ching Cheung Tung (hereinafter referred to as “Ching”) for account opening services.  Ching was referred by Mr Choi’s, and started working for IBBA on 4 September 2017.  He was dismissed on 1 May 2018 with one month’s notice, and his last day of work was 31 May 2018. Ching was responsible for liaising with agents and picking up calls to D3’s mobile phone number when D3 was outside Hong Kong.

87.  When D3 was outside Hong Kong, Ching followed up on matters relating to account opening.  D3 was not in Hong Kong when the messages the Prosecution alleges to have been sent by him were made, except for 19 November 2017, when the messages were sent shortly before 7 pm, and he had left for mainland China at 9:30 pm.

88.  IBBA was the company secretary for D2’s company Power Cash.  D2 later became one of the agents engaged by IBBA for account opening services.  From the very start, D3 instructed D2 to open multi currency accounts for clients without exception, therefore he assumed that when he gave instructions to D2 to open Funson’s company account, it would be a multi currency account.

89.  D3 testified that he never had the security device, password or any form of access over clients’ company accounts.  The WhatsApp message that he had sent to D2 on 7 May 2018 (at counter 6139 of P28) refers to the security device of D1 being blocked, and that he had called customer service hotline.  In fact it was Mr Choi who contacted him about the blocking of the security device, and in order to provide better service so that there might be future business opportunities, he took up the responsibility to sort out this matter with D2 and D1.

90.  Concerning the WhatsApp messages between himself and D2 at counter 6157 of P28, he sent “So scary” as there was a phone call from D2 earlier, where D2 said there was big trouble, the agent told D2 that many police officers went to Dah Sing Bank to investigate a case related to the accounts opened by D1 and her sister.  D3 hung up the call to pick up another call from a client, after which he sent this message “So scary” to D2.

91.  Concerning the WhatsApp message with D2 at counter 6158 of P28, D2 forwarded a photo originally from Lam Man Sze to D2, showing money had been transferred out of the Funson account.  As the message also showed that the 2 sisters had not been paid yet, D3 thought the 2 sisters had stolen money from their boss, and he suspected that was the reason that the police went to the bank for investigations.  From his understanding, Ah Hei was someone under Mr Choi, and Ah Hei was responsible for paying the employees.

92.  For the messages that followed, D3 was making guesswork about what might happen afterwards.  He thought that if it was Mr Choi who had reported to the police, it might be troublesome to himself and D2 when the nominee status of D1 and her sister had to be proved.

93.  D3 stated that he did not conspire with D1 and D2 to deal with the amount of money specified in the charge, and that he did not know that amount of money would be transferred into the Funson account.  For the rest of the 30 bank accounts that he had helped Mr Choi to open, there were no complaints or problems.

Case Analysis

D1’s Credibility and Reliability (as PW1)

94.  I have carefully considered the evidence of D1 and her demeanour while giving evidence.  I bear in mind that she was one of the persons jointly charged with D2 and D3, and that by giving evidence against the other Defendants, she stands a chance for a reduction of sentence.   I have therefore considered her evidence with the utmost care.

95.  I find that the material part of D1’s evidence is clear and logical, and there are no material inconsistencies or material inherent improbability.  I find her an honest witness, and shall accept the material parts of her evidence as credible and reliable.

96.  Under cross examination by D2’s counsel, D1 stated that she forgot to mention in her 1st witness statement made on 28 April 2023 that there was a second male (“a fat guy”) at the Second Meeting with Lala, as the fat male was less involved in the conversation.

97.  She also agreed that Lala expressed sympathy towards her indebtedness, and that Lala also mentioned the more the work, the more the returns.  Lala mentioned that the ID card copies received from D1 and her sister were for preparing documents.  She could not recall some details due to lapse of time.

98.  When D2’s counsel showed her 1st witness statement during cross examination, D1 agreed that she made mistakes in recollecting certain aspects of the 2nd Meeting with Lala: in fact the job of opening account was explained by the male in the car, that the accounts would be transferred to others to do business, and that for every account opened by D1, she would be given $1,000 reward.  Lala also asked D1 if she was interested in this job.

99.  She also agreed that due to the lapse of time, she had mixed up the content of her conversation with Lala and the 2 males, and the conversation between herself and D2.  Despite that, she insisted that at the first meeting with D2, D2 explained the job nature and also mentioned the remuneration to her being $1,000 for every account successfully opened.

100.  D2 also challenges D1’s credibility on the basis that D1 did not mention in her witness statement that D2 had asked her to sign on a document.  D2 replied that she cannot remember regarding the witness statement.

101.  D2’s counsel also put to D1 that on 3 November 2017, D1’s sister only opened bank account at the Wanchai and not the Causeway Bay branch of Dah Sing Bank.  D1 replied that they went to the bank together, but cannot recall if her sister’s bank account was successfully opened.

102.  I find that the above challenges to her evidence by the Defence can be fully explained by lapse of time.  The events unfolded from October 2017 to 2018, and the 1st witness statement made sometime in 2023, and her evidence in Court in 2025.  As the events spanned a number of months, with meetings, whatsapp and telephone calls with different people, it is easy to confuse the exact content of each and every conversation.  The Court does not expect a witness to remember each detail, and makes suitable allowance for memory becoming less accurate with the lapse of time.

103.  Although she admitted in Court that she had mixed up some of the things said at the meeting with Lala and the males, and those said by D2 at their first meeting, what is material in the case is whether D2 was the person who instructed her to perform the steps required in the opening of the bank account, and who had provided the company documents for her to read, and briefed her on the kind of questions that would be asked by the bank staff.

104.  Although the pdf file containing the company information was not exhibited, it is common ground that it contains basic information about Funson and its business nature, and Companies Registry documents, and proof of business being conducted, in order to be viewed as sufficient supporting documentation to the bank for opening a company account.  Although the Prosecution case is unclear about who had prepared the documents, it is also common ground that D2 was the person who brought the documents to D1.  There seems to be little dispute as to the factual basis of the dealings between D1 and D2, save as the part about the discussion about remuneration to D1 and the introduction of the job nature by D2.

105.  I find that it is understandable that while giving evidence in 2025, D1 had forgotten certain things that were discussed at the meeting with Lala and the 2 males in 2017 due to lapse of time, despite being able to recall those events in her 2023 witness statement.

106.  But despite the cross examination along those lines, she was adamant that D2 did mention the job nature and the amount of remuneration at their first meeting.  From this observation, it is clear from her evidence that the so called “mix up” between the meeting with Lala and the males, and the first meeting with D2, was in fact a slip of memory mainly concerning the meeting with Lala and the males.  I find that her evidence concerning the first meeting with D2 as unshaken, clear and logical.

107.  She denied under cross examination that D2 provided services to assist her in opening accounts for companies.  She insisted that D2 was the person who asked her to open accounts, and that she had followed D2’s orders.

108.  She also denied knowing anyone named Ah Hei or Mr Choi.  She also testified that she did not know the meaning of ‘nominee’, and she did not act as a nominee in the opening of the bank accounts.  She stated that she only knew she became the director of Funson on 1 November 2017 and that she had signed in the Notice of Change of Company Secretary and Director when the police took the VRI with her.

109.  I find that it is credible that she would not understand the meaning of nominee.  She is a young woman in her 20s without having completed her associate degree course.  Her present occupation is puppy-walker and is not related to financial or corporate fields.  The concept of nominee is not a concept so commonly known by the general public as to raise eyebrows when a person displays ignorance of it.

D2’s Credibility and Reliability (Evidence in Court and in VRI)

110.  I have carefully considered the evidence and demeanour of D2.  D2 has voluntarily disclosed his record in his evidence.  In Chief, and I shall not draw any adverse inference against him due to the said disclosure.  I shall further note that his record is not of a similar nature as the present charge, and is neither of a dishonest nature.

111.  Concerning the VRI of D2, I have considered the inculpatory and exculpatory parts independently.  I find that the inculpatory part, the parts consistent with the Prosecution case, and those supported by documentary proof, as logical and credible, and I therefore accept those parts as the truth.  For the exculpatory part, I find that it is incredible and self serving, and I shall therefore not give any weight to this part.

112.  As D2’s evidence is largely in line with the content of his VRI, I shall proceed with analyzing both at the same time, save the parts that are specifically dealt with separately below.

113.  During his evidence In Chief, D2 said that he did not know what D3 was talking about being “So scary” in the WhatsApp message.  Yet he was able to respond by saying he had called the elder sister and found out that the sisters had not been paid yet, and that he wanted them to receive money first, then if something happens they would know what to say, otherwise they would disclose whatever she likes.  As the conversation continued on WhatsApp, D2 mentioned in counter 6166 of P28 WhatsApp messages between himself and D3 about going to the police station.  I am of the view that it would not be possible for the several messages to go back and forth between them without D2 knowing or asking what D1 was talking about in the first place.

114.  The suggested scenario put forward by D3’s counsel in cross examination of D2 is more convincing, that D3’s message of “So scary” was as a result of a telephone call between the 2 of them, where D2 mentioned his friend Chirsty informed him that the police went to Dah Sing Bank being concerned about the sisters’ bank accounts.  To this, D2 replied that he had no recollection of having said that to D3, and that there was no phone call with D3 as alleged.  I am of the view that D2 was lying in the witness box, and nothing that he said could explain the absurdity of the relevant whatsapp messages on 8 May 2018.

115.  I am also of the view that the explanation given by D2 about ‘wanting the sisters to be paid’ is unconvincing.’  Under cross examination by the Prosecution and also in his evidence In Chief, he explained that he was concerned that if the sisters had not been paid, they might reveal or report matters to Mr Choi and therefore affect his business.  Yet all that was done by Lam Man Sze at that juncture was sending the SMS that D1 had received concerning money being transferred out, indicating that the USD account was functioning.  Nothing was mentioned about the account running for some time and yet payment was not made to D1, and Lam Man Sze was not chasing for remuneration for herself or D1.  It was a far cry from the SMS and the conversation between Lam Man Sze and D2, to D2 claiming that he was afraid the sisters would reveal the outstanding payment matter to Mr Choi and causing problems with future business.

116.  D2 also explained under cross examination by the Prosecution that he referred to the police station in the whatsapp messages with D3, as Mr Choi was a businessman, so if anything happens, and the account is unclear, Mr Choi would report to the police.

117.  According to counter 6161 of P28, D3 mentioned that the money had already been given to Ah Hei, apparently as the person who was responsible for paying the sisters.  Yet D2’s reference to the police station was later in the conversation.  According to D2’s evidence, there was at that point not even the slightest suggestion that there were unclear accounts, or Ah Hei delaying payment to the sisters.  To connect that state of affairs to Mr Choi making report to the police simply does not make any sense.

118.  D2‘s version of how D1 and Lam Man Sze came to become nominees of the companies is also unbelievable.  He talked about the nominees’ contact being provided by Mr Choi to D3, and from D3 to him, yet in counter 1897 of P28, D3 asked D2 whether the sisters could open more than the existing 4 accounts.  He agreed under cross examination that D3 was asking for his opinion.  Yet according to his version, the nominee for each company was not his nor D3’s decision.  I find that his evidence in this respect inconsistent with contemporaneous whatsapp evidence.

D3’s Credibility and Reliability

119.  I have carefully considered the content of D3’s evidence and his demeanour when giving evidence.  Except the parts not disputed or supported by IBBA company documents, Companies Registry documents or bank documents, I find D3’s evidence incredible, and rife with inherent improbabilities and inconsistencies both within his evidence in Court and with his VRI which he stated as containing the truth.

120.  The Court however accepts the part of D3’s evidence concerning D2 making a call to D3 about the news that police officers had visited Dah Sing Bank about the accounts opened by D1, as the precursor for the WhatsApp messages in P28 starting with counter 6157.

121.  Concerning D3’s VRI, I have considered the inculpatory and exculpatory parts independently.  I find the inculpatory part, those parts consistent with the Prosecution case or supported by IBBA company documents, Companies Registry documents or bank documents, as logical and credible.  I shall accept such parts as the truth and shall give them absolute weight.  For the exculpatory part, I find them incredible and illogical, and I shall therefore refuse to accept them as the truth, nor to attach any weight to it.

122.  For avoidance of doubt, the Court accepts that D3 owned a secretarial company IBBA, which deals with account opening services apart from other usual secretarial company services. It is also accepted that IBBA engaged D2 as its agent in account opening services.  These would apply equally to the Court’s assessment of D2’s evidence and his VRI.

123.  As D3’s VRI is largely in line with his evidence in Court, I shall deal with both in one go, save as the points specifically dealt with separately below.

124.  D3 testified that he guessed the 2 sisters had stolen the amount of money specified in the SMS forwarded to D2 by Lam Man Sze.  In fact that SMS only indicates that sum of money being transferred out through online banking from the Funson account to an unregistered account.

125.  The photo of the SMS also shows the conversation between D2 and Lam Man Sze, where Lam Man Sze mentioned that the account opened by D1 is now in operation, and asked D2 whether he had been paid the fees.  From all appearances, even taking into account the information and knowledge of the events of D3, the messages appear to be sharing of the account opening result and obtaining of information concerning the payment status to other related parties.  It is absolutely illogical to guess that the sisters have embezzled the funds of Mr Choi, when they disclosed without compulsion or duty the fact that a very large amount of money had been transferred out of Funson’s account, which would inevitably draw suspicion on themselves.

126.  I am of the view that D3’s explanation above as to his ‘guesswork’ was an attempt to make his discussion with D2 subsequent to receiving the forwarded photo containing the SMS less suspicious, bearing in mind that the said discussion between himself and D2 related to an assessment of whether blame would be placed on the 2 of them based on whether money had changed hands, and whether they had to go to the police station.  I therefore do not accept D3’s explanation concerning the messages on 8 May 2018.

127.  Although D3 did not contest the admissibility of the WhatsApp messages between his phone number and D2, he explained in the witness box that for all the WhatsApp messages sent from his phone number and relied on by the Prosecution, all but one day’s messages were sent when he was outside Hong Kong and not by him.

128.  Under cross examination by the Prosecution, he claims that he had lent the phone number to Ching when he was outside Hong Kong.  When confronted by his answer in his VRI that he had not ever lent this phone number to anyone, he initially replied that the police did not ask.  When fiat counsel pressed him by asking whether his answer in the VRI to the specific question by the police about whether he had lent his phone number to anyone was true, he replied with “I had not lent it to anyone at that time.”  Fiat counsel then put to D3 that he had not been lending the phone to his employee, and then came the answer from D3 “Yes, because employees are employees, they are not other people.”

129.  During Re-examination, he referred to counter 1188 of his VRI, which mentions the specific phone number “is the phone Number of my company.  (It) is my phone Number”, and explained that he chose that as his phone number, and that any employee of the company can use it.

130.  The Court notes that during the questioning in the VRI, some if not all of the whatsapp messages from his phone using the specified phone number and which are related to the present case were shown to D3 for his comment.  He had never mentioned that some of the WhatsApp messages might not have been sent by him as he might not be in HK, or that he would lend the phone number to his staff for follow up purposes.  Although he is not obliged to provide information to the police, it is too much of a coincidence for the lending of phone number and sending of WhatsApp by staff to come up for the first time during evidence in Court.

131.  The above account of the cross examination of D3 by fiat counsel and his Re-examination also demonstrates very clearly the evasiveness and sneakiness in which D3 approaches his evidence.  When faced with the fact that his evidence is contrary to his earlier statements in the VRI, he tries to blame the police, and then to twist the meaning of everyday plain words.

132.  Although D3 does not have the burden to prove his innocence, his claim that the majority of the WhatsApp messages were sent not by himself, and that he had lent his phone number to Ching, a part time staff who had since been dismissed by IBBA for reasons of work ethics, for handling calls in his absence from Hong Kong is easy to make, and is one which the Court must take great care to assess.  Based on the inconsistency with the content of the VRI on the use of the phone number, coupled with the uncanny coincidental first appearance of such a claim in Court, I find that the said claim is incredible and I shall reject it.

133.  Concerning the identity and role of Mr Choi, D3 stated under cross examination by Prosecution that Mr Choi was his company’s client, and he understood him to be the boss.  When fiat counsel confronted him that in his VRI counter 1023, he said Mr Choi might just be an errand boy, to which D3 answered he might be.  Eventually he agreed that he did not care whether Mr Choi was the boss or the errand boy, as long as Mr Choi brings in the business. When this Court clarified this with him, he stated that Mr Choi said his employees wished to open company accounts.

134.  The above shows his evasive attitude concerning a very simple question about his impression of someone that according to his VRI he considered as an important client who brought in lots of business and made advance full payment in cash for 8 companies.

WhatsApp Messages

135.  As stated above in the analysis of D3’s evidence, I reject D3’s evidence that save as one of the days, the messages sent from his phone number on all other days relied upon by the Prosecution were not made by him.  Despite accepting the Immigration records of D3 (which are agreed under s65C Criminal Procedure Ordinance), I reject his evidence that he had lent his telephone number to Ching.

136.  136.   I find that the messages in P28 are consistent with the roles of D2 and D3, and I therefore accept that all messages sent from D2 and D3’s telephone number were in fact made by D2 and D3 respectively.

Legal Principles

137.  The Prosecution has indicated that the co-conspirator’s rule is relied on.  From the PTR until Closing Submissions, defence counsels and the Court had repeatedly enquired with Prosecution as to the factual basis which must be proved by the Prosecution before the co-conspirator’s rule can be invoked.  It is imperative upon the Prosecution to make a clear indication so that the Defence will know how to meet the Prosecution case, and to make submissions as to whether the rule can be successfully invoked.  I have been unable to ascertain from the representations of fiat counsel as to what those facts are. The Court must not be left in a position of having to guess at which facts are relied on as the prerequisite for the application of the rule.  I am therefore of the view that the Prosecution has failed to demonstrate, let alone prove, the facts that have to be proved as the basis for the co-conspirator’s rule to apply.

138.  Before I may convict D2 and D3, I must be sure that there was an agreement to deal with property known or believed to represent proceeds of an indictable offence, that they had joined in the agreement with D1, that they intended to make that agreement, and that, when D2 and D3 did so, they intended that they or some other party to the agreement would carry out the agreement.

139.  In HKSAR v Harjani Haresh Murlidhar [2019] HKCFA 47, CFA reformulated the relevant legal tests of money laundering in the following manner:

“(i) What facts or circumstances, including those personal to the defendant, were known to the defendant that may have affected his belief as to whether the property was the proceeds of crime (“tainted”)?

(ii) Would any reasonable person who shared the defendant’s knowledge be bound to believe that the property was tainted?

(iii) If the answer to question (ii) is “yes” the defendant is guilty. If it is “no” the defendant is not guilty.

27. Thus the first issue that the judge or jury (“the court”) must address is what matters the defendant knew of that might have affected his belief as to whether the property was clean or tainted. This question is subjective only in as much as it requires the tribunal to make findings as to the knowledge of the defendant at the time of the relevant transaction. Where the defendant gives evidence of facts and matters that affected his belief about the nature of the property, the court has to decide whether he is, or may be, telling the truth about the existence of these facts and matters.

28. The second issue is whether any reasonable person who shared the defendant’s knowledge would have been bound to believe that the property was tainted. This question is objective. Where the court finds that the defendant was, or may have been, telling the truth about the existence of facts and matters that he claims affected his belief, the court must take those facts and matters into account when answering the question, would any reasonable person with knowledge of those facts and matters have believed that the property was tainted? If the answer to the question is “yes” the defendant is guilty. If it is “no” the defendant is not guilty.”

140.  I will make my deliberations on the application of the legal principles on each defendant independently.

Case Analysis Based on Evidence Accepted by the Court

141.  As stated in these Reasons, I have accepted the material part of the evidence of D1 as the truth.  What has been proved is that in or about September to October 2017, D3 received instructions and payment from a Mr Choi, who requested that company accounts be opened for a number of companies already in existence, some of which had D1 becoming the shareholder and director shortly before the opening of company accounts.  D3 received the company documents from Mr Choi, and forwarded them to D2 on 2 November 2017.

142.  D3 engaged D2 as the agent for the account opening procedure.  D2’s involvement included contacting and arranging D1 for a meeting, where the job nature and remuneration were mentioned, and company documents required for account opening were passed to D1 for studying.  D2 instructed another agent with bank contact to arrange the account opening meetings at the bank.

143.  On 3 November 2017, D2 accompanied D1 to the vicinity of the bank, handed over company documents for the account opening to D1, and waited outside while D1 dealt with the procedure.  After completion, D1 checked and kept the company documents.  Then D1 and D2 repeated the same procedure at another branch of the same bank.  1 out of the 3 accounts opened by D1 that day was the Funson account.

144.  When the bank came back to D1 with request for company document with a clearer print, D1 passed on the request to D2, and D2 contacted D3 for the better copy and forwarded to D1 for sending to the bank.

145.  In May 2018 D3 came to know that the security device for company accounts opened by D1 had been blocked, D3 called Customer Service, and thereupon approached D2 on 7 May 2018 to ask D1 to call the bank to unblock. D2 did as requested.

146.  On 8 May 2018, D2 called D3 and informed D3 that his agent Chirsty said that police had visited Dah Sing Bank concerning the accounts opened by D1. Thereupon D2 and D3 engaged in a series of WhatsApp messages as recorded in counters 6157 to 6161, 6164 to 6166 of P28 and P28A (see Appendix 1)

147.  There is unarguably an agreement between D1, D2 and D3 to open a company bank account for Funson.  The question is whether there was an agreement to deal with property known or believed to be proceeds of an indictable offence.

148.  There is no direct evidence that D2 or D3 knew that the amount specified in the Charge and as transferred into and away from the Funson account was the proceeds of an indictable offence.  In fact there is no evidence at the trial of D2 and D3 that the amount was in fact the proceeds of an indictable offence, or that an indictable offence had occurred.

149.  According to HKSAR v Harjani Haresh Murlidhar, a two stage test had to be adopted.  I have already conducted independent analysis on the credibility of the facts and matters within D2’s and D3’s knowledge separately that might affect their respective belief.

150.  The matters that the Court accepts as within D2’s knowledge within the period of the Charge (ie from 30 October 2017 to 30 April 2018) which might have a bearing on his belief are:

(i) he intended to start a company account opening agency business in 2017;

(ii) previously he was in the finance company business;

(iii) He approached D3 who ran a secretarial company (IBBA) for referral of business for company account opening;

(iv) His finance company accounts were handled by IBBA;

(v) D3 told him that IBBA provided company account opening service;

(vi) He was informed by D3 that a Mr Choi had a number of companies for which he wanted his staff to open company accounts as nominees;

(vii) D3 sent the pdf file with information of 8 companies, including Funson, to D2. The file contained documents required for nominees of Mr Choi to present to the bank for opening company accounts;

(viii) D1 was the director and shareholder of Funson but as a nominee;

(ix) That as part of the services to the client, D2 reminded D1 of the questions the bank staff would ask at the account opening meeting. D2 also brought the original company documents to the nominee D1 near the bank, and kept the documents for the client after the procedure in case the bank wants to have document copies sent again;

(x) the bank was in contact with D1 for clarification of matters for the opening of the Funson account;

(xi) The original company documents were returned to Funson; and

(xii) On 30 April 2018, D2 came to know through Lam Man Sze that USD245,740 had been transferred out of the Funson account by online banking to an unregistered recipient account.

151.  The matters that the Court accepts as within D3’s knowledge within the period of the Charge (ie from 30 October 2017 to 30 April 2018) which might have a bearing on his belief are:

(i) D2 approached him and his secretarial company (IBBA) for referral of business for company account opening;

(ii) D2’s finance company’s accounts were handled by IBBA;

(iii) IBBA had all along advertised and provided company account opening service;

(iv) A man named Mr Choi approached IBBA and stated that he had a number of companies with different lines of businesses for which he wanted his staff members to open company accounts as nominees for business operations. D3 referred the business of Mr Choi to D2;

(v) D3 received from Mr Choi, and sent the pdf file with information of 8 companies, including Funson, to D2. The file contained documents required for nominees of Mr Choi to present to the bank for opening company accounts;

(vi) Mr Choi was an important client to IBBA, as he paid for the company account opening fee for the many companies involved in advance full payment and by cash.

(vii) D1 became the director and shareholder of Funson shortly before the opening of company account but as a nominee;

(viii) It was D3’s understanding that as part of the services to the client, D2 would remind D1 of the questions the bank staff would ask at the account opening meeting, and bring the original company documents to the nominee D1 near the bank;

(ix) That the bank was in contact with D1 for clarification of matters for the opening of the Funson account, and D2 would handle the bank’s requests for D1;

(x) The original company documents were returned to Funson after all documentation and procedure had been completed; and

(xi) On 30 April 2018, D2 came to know through Lam Man Sze that USD245,740 had been transferred out of the Funson account by online banking to an unregistered recipient account.

152.  For the second stage of the test, I have to consider whether a reasonable person with D2 and D3’s respective knowledge, is bound to believe that the amount of USD245,740 represented the proceeds of an indictable offence.

153.  Apparently D2 performs the role of an agent in the Funson account opening, as evidenced by the payment slips from D3 to him dated 30 January 2018 that bear remarks of ‘commission’, with payments relating to other companies bearing remarks of ‘agent fee’ and initials of banks.

154.  There is no direct evidence that D2 or D3 knew the said amount would be or had been transferred into the Funson account, nor any evidence that they knew ahead of time that the said amount would be transferred out.

155.  There is also no direct evidence that D2 or D3 had received the online banking password, the bank card, or the security device.  It would appear that the bank card was mailed to the registered address of Funson, which is not the same address as IBBA’s address.  Despite D1 mentioning an occasion where D2 informed her that the bank card had been received, there was no reference as to who had received it, and it was only made in the context of telling D1 there is no need to follow up.

156.  There is, however, some suggestion from the WhatsApp messages in P28 that in May 2018, D3 contacted D2 and mentioned that D1’s security device was blocked, and that he had called the customer service hotline, with the reply from the hotline that the director of the company had to contact the bank to unblock the device.

157.  Despite the court not accepting certain parts of D3’s evidence, a careful reading of the WhatsApp message only indicates the security device as being blocked, but did not mention the source of such information.  Therefore it cannot support an irresistible inference that D1 was in possession of the security device at any point of time.

158.  From the above, I am of the view that there is nothing that would cause a reasonable person with D2’s knowledge of the facts to believe that the agreement to open a company account for Funson involves dealing with the proceeds of crime.  Having nominees as director and shareholder of a company is not uncommon in Hong Kong.  When a company is held by a nominee, the company bank account can only be opened by a nominee.  Late changes of nominees right before opening of bank accounts are also not uncommon,

159.  It is also not unusual for companies to engage agents with bank contacts to deal with the initial arrangements for company account opening, and to advise on the documents required to be presented to the bank.  There were also an abundance of so called ‘accounting services companies” advertising services for opening company bank accounts in Hong Kong.  That is not to say that such companies have a ‘licence’ to engage in money laundering activities.  Much depends on the facts of each case. The same analysis applies to D3, save as to certain facts unique to D3 which will be discussed below.

160.  It is not disputed that D2 had received the basic set of company documents for account opening purposes from D3, with information on the line of business of Funson, and business proof.  D2 hasn’t taken up many company account opening instructions before Funson; whereas in his understanding D3 had been providing such services as a secretarial services company.

161.  It is also normal for an agent not to have direct contact with the ‘boss’ who is Mr Choi in the present case.  There is also on the face of it, nothing unusual for the agent not to enquire or know about who pays for the fee charged by a secretarial services company of a nominee director opening a company bank account.

162.  The facts unique to D3’s knowledge that are not shared by D2, and which affects the objective stage of the test, include the fact that he charged Mr Choi full payment in advance, which was the same payment requirement for all clients requiring company account opening service.  The main feature is that the initial instructions concern 5 companies, and from the table produced by D3 (D3-34), the fee paid by the client for Funson and the other companies where the director and shareholder was either D1 or Lam Man Sze, was $16,000 for each account.  Although that is not a huge sum in business terms, paying for 5 companies in cash all at once would catch people’s attention.  But even though people practising illegal means are more likely to use cash to avoid tracing and detection, the fact that cash payment was made for this amount does not necessarily bring D3’s case outside the original analysis.

163.  Another unique feature to D3 is that he was the first contact with Mr Choi, who was not a previous client of his company.  He accepted the business from Mr Choi for opening of company accounts, yet did not keep Mr Choi’s ID Card copy or other documents that could indicate his identity or role in the companies, and did not even mention Mr Choi’s full name in evidence.

164.  This brings D3’s case to a borderline one, as he had received company documents from Mr Choi, and all companies appear to have legit business relating to different fields, apparently justifying the opening of many different company accounts.  The fact that one uses nominees for company directorships and operates behind the scene without disclosing one’s full name could be for either deceitful or innocent purpose.

165.  The Court has to further consider whether the actions and words of D2 and D3 after the end date of the Charge, i.e. after 30 April 2018, can be considered as shedding light upon the mens rea of D2 and D3.  There is no hard and fast rule, apart from the basic principle that words and actions after the event may go to prove mens rea during the time of the offence, but it depends on the circumstances.

166.  When D2 received the photo of the SMS message, the dealing with proceeds had already been completed a few hours ago.  From the conversation on that occasion between D2 and Lam Man Sze, it is at best neutral, and cannot support any allegation that D2 knew about the transfer ahead of time and that it was a report from Lam Man Sze to D2.  If it was out of duty that Lam Man Sze was reporting to D2 about a planned event, D2 would not have appeared to be rather grateful for the information, as shown in the message.  Instead it appears as a sharing of information so that remuneration can be claimed from whoever should pay D2.

167.  After D2 received the photo of the SMS from Lam Man Sze on 30 April 2018, he called and sent it to D3 on 8 May 2018, breaking the news that police officers had visited the bank concerning D1’s company accounts.

168.  The WhatsApp conversation that follows appears gravely suspicious for D2 and D3; there was reference of D3 saying “Very scary”, asking whether the transfer had already been made, was it taken by someone again or blocked by the bank; and D2 mentioning that he wanted the sisters to receive money first, otherwise D1 would disclose whatever she likes in case anything happens; then D3 saying its ok for D2 and himself as they don’t have monetary dealings with D1, it was only D1 who contacted D2 to open bank accounts; and D2 mentioning they might have to go to police station.  It reflects a picture of D2 and D3 panicking over the police investigations which might lead to them.

169.  In order to make use of behaviour after the charge duration as circumstantial evidence for the charged period, the inference must be very strong.  I am of the view that obviously D2 did not think there was anything exceptional about the transfer of funds out of the Funson account when he first received notification by Lam Man Sze on 30 April 2018, otherwise he would not have kept quiet about it until 8 May 2018.

170.  On 8 May 2018, as found by the Court, D2 had already heard from an agent that the police were investigating accounts opened by D1.  Under such circumstances, after he had notified D3 about it, D2 and D3 might panic because their involvement in a money laundering scheme might be detected, or they might panic because they were taken by surprise by the possibility of money laundering.  They were in the account opening business for different duration, yet they must have heard about and realised the risk involved in being entangled in money laundering schemes, whether intentionally or unknowingly.

171.  I am therefore of the view that the post-Charge WhatsApp messages cannot assist the Court in drawing an irresistible inference that D2 and D3 knew or had reasonable grounds for believing that the money dealt with in the Funson account were proceeds of an indictable offence.  To prove a conspiracy charge would still require the objective element of the money laundering charge to be proved beyond reasonable doubt.

172.  I am therefore of the view that by applying the 2 stage test to D2 and D3, they should be found not guilty of the Charge.  Despite the grave suspicion the Court holds over their possible involvement, reluctantly D2 and D3 are acquitted.