HKSAR v. KAM SUET WA, JESSICA

DCCC691/2012

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 691 OF 2012

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Reasons for Sentence

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1.  The defendant pleads guilty to 11 charges of evasion of liability by deception, contrary to section 18B(1)(b) of the Theft Ordinance, Cap.210.

2.  PW1 is a mainland citizen.  She is the sole proprietress of a mainland company called Chaochung Textiles Company Limited (“Chaochung Textiles”) whose main business was the trading of silk.  Defendant is the sole director of Beauty Fashion Limited (“Beauty Fashion”).  She started ordering silk from Chaochung Textiles since January 2010 and was given 60 days’ credit for payment of the goods delivered. 

3.  Between 5 January 2010 and 22 April 2010, the defendant ordered silk from Chaochung Textiles on nine occasions.  The total value of the silk delivered to the defendant was RMB1,757,230.14. 

4.  Payment for the first order was due on 8 March 2010.  However, in June 2010 and despite repeated requests, defendant had still failed to make any payment for any of the orders.  On 18 and 19 June 2010, PW1 paid personal visits to Beauty Fashion but was unable to locate the defendant.

5.  On 10(16?) July 2010, PW1 came to Hong Kong again and located the defendant.  The defendant issued three post-dated cheques drawn on the Bank of China account No. 012-566-00046581 in the name of Beauty Fashion (“Account A”), to Chaochung Textiles as follows:

(1) cheque No. 613871 for a sum of HK$868,234.55 dated 24 July 2010 (Charge 1);

(2) cheque No. 613872 for a sum of HK$485,904.09 dated 7 August 2010 (Charge 2);

(3) cheque No. 613873 for a sum of HK$652,255.84 dated 21 September 2010 (Charge 3).

6.  On 28 July 2010, PW1 instructed her accounting company in Hong Kong to deposit cheque No. 618371(613871?) dated 24 July 2010, but the cheque was dishonoured.  When PW1 asked for an explanation, the defendant claimed that it was due to her clients’ failure to make payment.  The defendant claimed that there would be sufficient funds in the account in a month’s time and requested PW1 to deposit the cheque again a month later.  She also asked PW1 not to deposit the two other cheques until September 2010.  PW1 complied with the defendant’s request, but all three cheques were still dishonoured. 

7.  PW1 kept on asking the defendant to make payment.  Between November 2010 and May 2011, the defendant paid a total of $890,000 to PW1.  In October 2011, PW1 lost contact with the defendant. She found that the defendant’s residence and the office of Beauty Fashion were both vacated, and she reported the matter to the police.

8.  PW2 is also a mainland citizen.  She is the proprietress of a mainland company called Hongyang Weiyi Company Limited (“Hongyang”) whose main business was the trading of silk.  PW2 started accepting purchase orders from the defendant since February 2010.  The first few orders were around RMB10,000 each and the defendant was required to make payment before delivery.

9.  After three to four purchase orders, PW2 agreed to give the defendant 45 to 60 days’ credit.  Between 5 January 2011 and 4 July 2011, the defendant ordered silk from Hongyang on eight occasions. The total value of goods delivered was RMB3,356,307.20.

10.  Between 20 May 2011 and 12 September 2011, upon PW2’s requests, the defendant deposited a total of seven cheques to the account of Zheng Jing as payment for goods delivered.  Zheng Jing was a staff of PW2’s contracted transportation company.  On each occasion, PW2 confirmed that the cheque had been deposited.  However, each of those cheques was subsequently dishonoured.  The details of the seven dishonoured cheques are:

(1) cheque No. 659957 drawn on Account A dated 20 May 2011 for a sum of HK$450,000 (Charge 4);

(2) cheque No. 729684 drawn on Beauty Fashion’s account with the Shanghai Commercial Bank account No. 336-82-056325 (“Account B”) dated 29 May 2011 for a sum of HK$800,000 (Charge 5);

(3) cheque No. 734854 drawn on Account B dated 5 September 2011 for a sum of HK$40(HK$40,000) (Charge 6).

(4) cheque No. 734855 drawn on Account B dated 12 September 2011 for a sum of HK$40,000 (Charge 7);

(5) cheque No. 659904 drawn on Account A dated 28 September 2011 for a sum of HK$1.9 million (Charge 8);

(6) cheque No. 659905 drawn on Account A dated 30 September 2011 for a sum of HK$1.9 million (Charge 9);

(7) cheque No. 659907 drawn on Account A dated 5 September 2011 for a sum of HK$3.9 million (Charge 10).

11.  All along, PW2 was only able to collect $283,000 from the defendant for the goods delivered.

12.  PW3 is the sole proprietress of Ho Tim Textiles Company (“Ho Tim”).  PW4 was one of the sales representatives of Ho Tim. 

13.  On 14 September 2011, defendant placed a purchase order to Ho Tim for 21,600 yards of plain cotton cloth at HK$11.50 per yard.  The purchase price was $248,400 and the defendant was given 45 days’ credit after shipment. 

14.  All the cotton ordered was collected on 22 September 2011.  On 23 September 2011, the defendant visited Ho Tim and gave PW4 a cheque No. 659903 drawn on Account A dated 8 November 2011 in the sum of $248,400 (cheque 1) (Charge 11).

15.  On a day between 20 October 2011 and 25 October 2011, the defendant presented another cheque drawn on an account held by Beauty Fashion at the DBS Bank No. 317876 and post-dated to 8 November 2011 (cheque 2) to replace cheque 1.  PW4 did not have cheque 1 in hand at the time and the defendant left.  Feeling suspicious, PW3 and PW4 later requested defendant to pay for the goods on a date earlier than that agreed. 

16.  The defendant agreed but never turned up, and PW3 and PW4 were unable to contact the defendant thereafter. 

17.  When PW3 tried to deposit cheques 1 and 2 on 8 November 2011, both of them were dishonoured.  The case was then reported.

18.  Account A was opened by the defendant on 19 April 2010.  She was the sole signatory.  Between 12 May 2010 and the closing date of Account A on 9 August 2010, the balance was either in debit or below HK$10,000. 

19.  When the defendant issued the three post-dated cheques drawn on Account A in favour of Chaochung on 16 July 2010, the balance of Account A was still in debit in the sum of HK$826.45. 

20.  When the first post-dated cheque to Chaochung Textiles fell due on 24 July 2011, Account A was in debit balance of $1,576.45. When the second post-dated cheque to Chaochung Textiles fell due on 7 August 2010, the balance in Account A was only $9,695.50.  Account A was closed two days thereafter.  As a result, when the defendant issued the four cheques drawn on Account A to Zheng Jing and cheque 1 to Ho Tim, Account A was already closed.  

21.  The defendant opened Account B on 28 April 2011. She was the sole signatory.  She countermanded payment of the three cheques drawn on Account B issued to Zheng Jing. 

22.  Traffic index records show that the defendant left Hong Kong via the airport on 27 October 2011.  On 23 March 2012 when the defendant returned to Hong Kong from Indonesia, she was arrested. 

23.  In the subsequent video-recorded interviews, the defendant claimed under caution that: 

(1) She was the sole proprietress of Beauty Fashion.

(2) She started purchasing silk from PW1 since May 2010. She had issued three post-dated cheques drawn on checking account of Beauty Fashion with the Bank of China to PW1 in May 2010.

(3) She forgot to tell PW1 not to deposit the first cheque. She had asked PW1 not to deposit the second and third cheques, but she did not know why PW1 had not complied with her request.

(4) She knew that Account A had been closed because she had issued too many dishonoured cheques, but she did not know the exact date of closure.

(5) She had issued seven cheques to PW2 from either the Bank of China or Shanghai Commercial Bank accounts of Beauty Fashion. She could not explain why she had issued cheques drawn on Account A between May and September 2011 when she knew that the account was closed in July 2010.

(6) She had issued two cheques in the sum of HK1.9 million each and one cheque in the sum of 3.9 million to PW2 because PW2 had sent triads to collect payment from her.

(7) The defendant had countermanded payment of the cheques issued to PW2 and drawn on Account B on the day after presentation of the cheques because she knew there were insufficient funds in the account.

(8) She left Hong Kong with her family to Indonesia because she feared for their safety and she wanted to find business opportunities for her to repay the debts owed to PW1 and PW2.

24.  The defendant remained silent in the interview in respect of Ho Tim.

25.  PW1, PW2 and PW4 positively identified the defendant in a formal identification parade.

The Defendant’s Background and Mitigation

26.  The defendant is aged 38.  She is married with two children, one of which is still at school.  Her husband was and still is unemployed but is looking for employment.  The defendant has a clear record.

27.  The defendant’s father has a dyeing factory. The defendant began to work in that factory after her Form 5 graduation, earning about twelve to thirteen thousand dollars per month inclusive of year-end bonuses.  She is said to be a filial daughter, good wife and mother.

28.  Counsel accepted that these offences were not committed as a result of mismanagement of the defendant’s company.  The defendant is addicted to gambling.  She visited the casinos in Macau regularly where she lost vast sums of money.  She was able to borrow large sums from loan sharks because her father had a factory.

29.  Counsel submitted that the defendant is very remorseful.  The outstanding amount due to the victims is $5,264,394.48.  The defendant is unable to make restitution of any part of that outstanding amount.

Sentence

30.  In passing sentence, I have considered everything put forward on the defendant’s behalf.  The prosecution has referred the court to the case of HKSAR v Lam Kam Tou [2006] 4 HKLRD 104 to helpfully remind the court that although the defendant left Hong Kong prior to her arrest, she did return voluntarily.  The prosecution accepted that there should be no reduction of the discount for the defendant’s guilty plea in those circumstances.

31.  Counsel submitted that the offences in Lam Kam Tou were committed within the space of 10 days and were clearly premeditated.  The amount involved was 6.6 million.  He urged the court to take those factors into consideration and impose a lenient sentence.

32.  I agree that the amount involved in the present case is about 1.4 million less than that in Lam Kam Tou.  However, there were only seven offences in that case whilst there are 11 offences in the case before me.  The offences in the present case were committed over a much longer period of time.  The defendant clearly knew that she was not in a position to make payment for the goods.  The purchase of the goods was a mere pretext for her to obtain money from innocent traders.  Even if the defendant were able to win back some or all of the money from Macau, the victims would never receive payment with the cheques drawn on Account A because it no longer existed. It was clear that the defendant had no intention of paying PW2 or PW3.

33.  I have something to add here.  The defendant explained that she issued cheques drawn on Account A because PW2 sent triads to collect money from her.  No triads were involved as far as Ho Tim were concerned and she still issued cheques drawn on Account A.  The proceeds of sale of the goods were used to feed the defendant’s gambling habit.  She was even willing to stake the factory owned by her aged and ailing father to borrow from loan sharks.  She deserves very little sympathy from the court.

34.  All the offences were part and parcel of the same scheme to obtain money.  I propose to adopt a global approach to sentence.  Having considered all the abovementioned matters, I am of the view that an overall starting point of 6 years would be appropriate.  I adopt a starting point of 6 years’ imprisonment for each charge.  I have to give the defendant full credit for her guilty plea.  The sentence for each charge is reduced to 4 years to be served concurrently.  That is a total sentence of 4 years.