HKSAR v. YEUNG SHUN KWAN

DCCC 687/2017

[2018] HKDC 697

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 687 OF 2017

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REASONS FOR VERDICT

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1.  Defendant Yeung Shun Kwan pleaded not guilty before me to two charges of Dealing with property known or believed to represent proceeds of indictable offence, contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap 455.

2.  For Charge 1, the particulars of offence are that the defendant, between 14 February 2008 and 4 March 2013, both dates inclusive, in Hong Kong, knowing or having reasonable grounds to believe that property, namely a total sum of $3,325,330 Hong Kong currency, in whole or in part directly or indirectly represented any person’s proceeds of indictable offence, dealt with the said property.

3.  For Charge 2, the particulars of offence are that the defendant, on or about 2 November 2015, in Hong Kong, knowing or having reasonable grounds to believe that property, namely a total sum of $1,953,000 Hong Kong currency, $59,200 United States currency and ¥2,457,000 Japanese currency, in whole or in part directly or indirectly represented any person’s proceeds of indictable offence, dealt with the said property.

Gist of the Prosecution case

4.  The prosecution relied on the following factors and asked the court to draw the inference that the defendant dealt with funds which the defendant had reasonable grounds to believe were the proceeds of indictable offence:-

(a) the vast amount of money (in excess of $3M) that went into the HSB account of the defendant and a lesser but still significant amount that went out of the same during the charge period;

(b) the vast amounts of HK$ (almost $2M), USD, and Japanese Yen found in the defendant’s safe deposit box;

(c) the defendant was not a person of means;

(d) 88% of the deposits and a similar percentage of withdrawals from that account were in the form of cash;

(e) Some of the cash deposits and cash withdrawals were in substantial amounts;

(f) The explanations given by the defendant during VRI were not comprehensive and sometimes contradictory to the defendant’s travel record; and

(g) The defendant’s travel record shows that she had day trips to Mainland/Macau soon after large cash withdrawals were made from the account.

Gist of the Defence case

5.  The defendant can now explain most if not all of the significant movements of funds in her account during the charge period.  She also reinforces under affirmation her cautioned version of the sources of the various currencies found in her safe deposit box.

6.  In essence, the defendant says that at all material times, the funds in her account and the major part of the various currencies in her safe deposit box belonged to her younger sister YYQ – a businesswoman resident in the Mainland; that she handled them on YYQ’s behalf.  A small part of the HK$ in the safe deposit box actually belonged to the defendant.

Issues in the case

7.  The ultimate issue in the case is what was in the mind of the defendant – whether she had reasonable grounds to believe that the property specified in the two charges, either in whole or in part, either directly or indirectly, represented proceeds of indictable offence.

The applicable law

8.  There is no dispute on the law.

9.  The meaning of “reasonable grounds to believe” was determined by the Court of Final Appeal in HKSAR v Pang Hung Fai (2014) 17 HKCFAR 778 and further explained in HKSAR v Yeung Ka Sing Carson (2016) 19 HKCFAR 279 as follows:-

(a) To convict, the court must find that the defendant had grounds for believing; and there was an additional requirement that the grounds must be reasonable: that is, anyone looking at those grounds objectively would so believe;

(b) The words in section 25(1) of OSCO refer to grounds which a defendant has: “by the use of the word ‘having’, the decision-maker’s attention is directed expressly, by the terms of the section, to the grounds available to the accused”;

(c) The Court of Final Appeal also clarified in Carson Yeung that the words “ought to have known” are generally taken to connote negligence and held that this should not be taken to be part of the proper test; and

(d) The court must also have regard to the personal beliefs, perceptions or prejudices of the defendant while taking account of the facts and circumstances known to him.

10.  Further, the following principles as enunciated by the Court of Appeal in Carson Yeung are applicable:-

(a) If the defendant provided no evidence of his beliefs and perceptions, or if he testified or called such evidence but was entirely disbelieved, the court was left to draw whatever inferences might be proper based on the prosecution’s evidence. It remained necessary for the court to be satisfied that the case against him had been proved beyond reasonable doubt;

(b) There was no requirement that after rejecting the defendant’s testimony, the court must make findings as to his “belief, thoughts and intentions at the material time”;

(c) If, on the other hand, the defendant’s evidence was accepted as true or as evidence which might be true, and if true would be inconsistent with him having reasonable grounds to believe that the property in question represented the proceeds of crime, an acquittal was called for; and

(d) Where the defendant’s asserted perceptions or beliefs which, even though believed by him, would strike others as excessively naïve or gullible or foolish in the light of objective facts known to the defendant or which would have led others readily to believe that reasonable grounds existed to believe that the property was tainted, the principle which required the focus to remain on whether the defendant had the requisite reasonable grounds to believe dictated that even in such cases, the offence was not made out.

Admitted Facts

11.  The parties admit the following facts as set out in a document known as “Admitted Facts” (produced as Exhibit P32) pursuant to section 65C of the Criminal Procedure Ordinance, Cap 221.

Personal Details

12.  The defendant’s Hong Kong identity card number is Xyyyyyy(z) (redacted).

13.  The defendant’s movement record from the Immigration Department between 1 July 2007 and 2 November 2015, both dates inclusive, is accurate and produced as Exhibit P1.

The defendant’s Income and Tax Position

14.  During the 6 years of assessment from 2010/2011 to 2015/2016, the defendant has worked at Wellpoint Property Management Services Limited (“Wellpoint”), Johnson Cleaning Services Company Limited (“Johnson Cleaning”) and Johnson Environmental Services Limited (“Johnson Environment”).

15.  The defendant’s income between the years of assessment 2010/2011 and 2015/2016 were as follows:-

Year of Assessment	Employer	Income (HK$)
2010/2011	Wellpoint	40,800
2011/2012	Johnson Cleaning	32,580
	Johnson Environment	22,960
2012/2013	Johnson Cleaning	57,060
	Johnson Environment	101,080
2013/2014	Johnson Cleaning	11,812
	Johnson Environment	100,800
2014/2015	Johnson Cleaning	35,875
	Johnson Environment	106,480
2015/2016	Johnson Cleaning	30,080
	Johnson Environment	64,200
	Total Amount:	603,727

16.  The defendant did not file any tax return with the Inland Revenue Department between the years of assessment 2007/2008 and 2011/2012.  On the other hand, the defendant’s tax returns between the years of assessment 2012/2013 and 2015/2016 and their certified English translation are collectively produced hereby as Exhibit P2 and Exhibit P2A respectively.

17.  The defendant’s assessed tax liabilities between the years of assessment 2012/2013 and 2015/2016 were as follows:-

Year of Assessment	Amount (HK$)
2012/2013	952
2013/2014	-762
2014/2015	558
2015/2016	-447
Total	301

18.  The defendant’s assessed tax liabilities between the years of assessment 2012/2013 and 2015/2016 and their certified English translation are collectively produced hereby as Exhibit P3 and Exhibit P3A respectively.

The defendant’s bank account with Chiyu Bank – Account A

19.  At all material times, the defendant was the account-holder and the sole account signatory of the following bank account (“Account A”):-

Bank name	Account no.	Type of account	Date of opening	Date of closing
Chiyu Banking Corporation Limited	039-751-1-008673-6	Personal Savings Account	2 May 2001	-

20.  Some income received by the defendant from Johnson Cleaning and Johnson Environment were deposited into account A.

21.  The affirmation of MOK Kwok-ling, senior operation officer of the Chiyu Banking Corporation Limited in relation to Account A is accurate and produced hereby as Exhibit P4.

The defendant’s bank account with Hang Seng Bank - Account B

22.  At all material times, the defendant was the account-holder and the sole account signatory of the following bank account (“Account B”):-

Bank name	Account no.	Type of account	Date of opening	Date of closing
Hang Seng Bank Limited	200-9-013539	Personal Savings Account	11 January 2007	-

23.  Account B was subsequently suspended on 3 November 2015 with a credit balance of HK$167,482.40.

24.  A table showing the details of all transactions in Account B between 16 January 2008 and 2 November 2015, both dates inclusive, is hereby produced as Exhibit P5.

Deposits

25.  Between 14 February 2008 and 4 March 2013, both dates inclusive, a total of HK$3,325,330 was deposited into Account B by cash, transfer or cheque as follows:-

	No. of Transactions	Amount (HK$)	Percentage (%)
Cash Deposits	58	2,934,330	88.24%
Transfer Deposits	47	341,000	10.26%
Cheque Deposits	1	50,000	1.50%
Total	106	3,325,330	100%

26.  A table showing details of the 58 cash deposits made between 14 February 2008 and 4 March 2013, both dates inclusive, is hereby produced as Exhibit P6.

27.  A table showing details of the 47 deposits by transfer made between 14 February 2008 and 4 March 2013, both dates inclusive, is hereby produced as Exhibit P7.

28.  A cheque issued by Chosewide Trading and Garment Company amounting to HK$50,000 was deposited into Account B on 16 April 2008.

Withdrawals

29.  Between 16 January 2008 and 2 November 2015, both dates inclusive, a total of HK$3,228,481 was withdrawn from Account B by cash or transfer as follows:-

	No. of Transactions	Amount (HK$)	Percentage (%)
Cash Withdrawals	51	3,013,800	93.35%
Transfer Withdrawals	13	214,681	6.65%
Total	64	3,228,481	100%

30.  A table showing details of the 51 cash withdrawals between 16 January 2008 and 2 November 2015, both dates inclusive, produced as Exhibit P8.

31.  Analysis of the 13 transfer withdrawals between 16 January 2008 and 2 November 2015, both dates inclusive, is produced as Exhibit P9.

32.  The affirmation of WONG Sze Long, banking operation officer of Hang Seng Bank Limited in relation to Account B is accurate.  The affirmation and its certified English translation are collectively produced and its certified English translation are collectively produced hereby as Exhibit P10 and P10A respectively.

Safe deposit box

33.  At all material times, the defendant was the holder of the following safe deposit box (“the Safe Deposit Box”):-

Bank name	Safe deposit box number	Branch	Date of opening	Date of closing
Bank of China (Hong Kong) Limited	012-878-83-04752-4	Yau Ma Tei	29 July 2011	-

34.  The affirmation of Chu Irene Ka Lam, senior operation officer of the Bank of China (Hong Kong) Limited in relation to the Sale Deposit Box is accurate and produced hereby as Exhibit P11.

The defendant’s Hong Kong Jockey Club account

35.  On 25 November 2013, the defendant opened a betting account numbered 26199330 with the Hong Kong Jockey Club (“the Betting Account”).  A table showing the details of all transactions of the Betting Account between 25 November 2013 and 2 November 2015, both dates inclusive, is hereby produced as Exhibit P12.

36.  Between 25 November 2013 and 2 November 2015, both dates inclusive, a total ofHK$171,458 was deposited into the Betting Account as follows:-

	No. of Transactions	Amount (HK$)	Percentage (%)
Cash Deposit	105	88,960	51.88%
Dividend from Betting	274	81,548	47.56%
Refund of Cancellation of Bet	17	950	0.55%
Total	396	171,458	100%

37.  Between 25 November 2013 and 2 November 2015, both dates inclusive, a total of HK$170,621 was withdrawn from the Betting Account as follows:-

	No. of Transactions	Amount (HK$)	Percentage (%)
Cash Withdrawals	6	18,600	10.90%
ESC Deposits	1	20	0.01%
Horse Race	2975	151,721	88.92%
Mark Six	13	280	0.16%
Total	2995	170,621	100%

38.  Between 25 November 2013 and 2 November 2015, both dates inclusive, the Betting Account recorded a net loss of HK$69,503 as follows: -

Gain / Loss	Description	Amount (HK$)
Gain	Dividend from Betting	81,548
Loss	Horse Racing	151,721
Loss	Mark Six	280
Gain	Refund of Cancellation of Bet	950
	Net Loss:	69,503

Companies and Land Registry Records

39.  At all material times, the defendant did not hold any shares of any company or own any property in Hong Kong.

Arrest and Caution

40.  On 2 November 2015, the defendant was arrested at her residence situated at Room 317, 3/F, Ching Ming House, Tsz Ching Estate, Tsz Wan Shan, Kowloon, for money laundering in relation to Account B.  Under caution, she first said she had nothing to say. She then said it was her younger sister had left the money with her.  The defendant said what she had said under caution voluntarily.

41.  On the same day, the defendant was brought to the Safe Deposit Box at the Yau Ma Tei branch of Bank of China (Hong Kong) Limited.  The defendant opened it with her own keys. Upon search, the police found inter alia cash of HK$1,953,000 in 20 stacks of notes, US$59,200 in 7 stacks of notes and Japanese Yen Y2,457,000 in 4 stacks of notes respectively.

42.  Between 10:35 am and 10:45 am on 2 November 2015, the police have taken in total 14 photos of the Yau Ma Tei branch of Bank of China (Hong Kong) Limited, the Safe Deposit Box and the cash found in the Safe Deposit Box.  The 14 photos are compiled into a Police Photo Album with a list of contents.  The Police Photo Album is produced hereby as Exhibit P13(1-14).  Both the photographs and details of the list of contents are accurate.

Cautioned video-recorded interview

43.  Between 1:05 pm and 3:36 pm on 2 November 2015, the police conducted a cautioned video-recorded interview with the defendant in the Video Interview Room of the Narcotics Bureau.  The defendant voluntarily attended the interview.  The whole process of the interview has been recorded in a DVD numbered AA38291.  The DVD and a Chinese transcript are the complete and accurate record of the interview.  The DVD is hereby produced as Exhibit P14. The Chinese transcript is hereby produced as Exhibit P15.  The certified English translation of the Chinese transcript is hereby produced as Exhibit P15A. The enclosure used during the interview is hereby produced as Exhibit P16. The English translation of the enclosure is hereby produced as Exhibit P16A.

44.  Between 3:54 pm and 3:58 pm on 2 November 2015, the police conducted a cautioned video-recorded interview with the defendant in the Video Interview Room of the Narcotics Bureau.  The defendant voluntarily attended the interview.  The whole process of the interview has been recorded in a DVD numbered AA38362.  The DVD and a Chinese transcript are the complete and accurate record of the interview.  The DVD is hereby produced as Exhibit P17. The Chinese transcript is hereby produced as Exhibit P18.  The certified English translation of the Chinese transcript is hereby produced as Exhibit P18A.

YANG Yan Qun

45.  Madam YANG Yan Qun (“Yang”) is the younger sister of the defendant.  Yang is a resident of the Mainland China.  Her Chinese passport number is G34943306.

46.  Yang’s movement record from the Immigration Department between 1 February 2008 and 3 November 2015, both dates inclusive, is accurate and produced hereby as Exhibit P19.

47.  At all material times, Yang was a director and shareholder of Skyview Development (HK) Limited (“Skyview”) and Tin Hang (China) Development Co Limited (“Tin Hang”).  She was also a shareholder of Bamboo Garden Limited (“Bamboo”).  Bamboo, Skyview and Tin Hang were incorporated in Hong Kong on 3 September 2010, 26 April 2011 and 8 June 2011 respectively.

48.  The Companies Registry’s records of Skyview, Tin Hang and Bamboo are hereby produced as Exhibit P20.  The contents of the records are accurate.

49.  Since incorporation, Tin Hang and Bamboo have reported adjusted loss to the Inland Revenue Department.  At all material times, there had been no reported profits chargeable to Profits Tax for Tin Hang, Skyview, and Bamboo since incorporation.

50.  At all material times, Bamboo was the holding company of a restaurant named “Carboni Modern Euro & Asian Cuisine” at No 23, Sai Ching Street, Yuen Long.  On 14 March 2016, police officers attended the restaurant and confirmed that it was opened for business.

51.  At all material times, Yang was the bank account-holder and the sole account signatory of the following two personal bank accounts:-

Bank name	Account no.	Type of account	Date of opening	Date of closing
Hang Seng Bank Limited (Account C)	212-411359-888	Integrated Account	2 April 2012	-
Citibank (Hong Kong) Limited (Account D)	68543689 26018500 87068338	HKD Savings Account HK Securities Services Account Currency Manager Account	1 June 2012	-

52.  Account C comprised of a current account, a savings account and a US$ account respectively.  As at 2 November 2015, the accounts maintained a balance of HK$1,875.81, HK$111,109.07 and US$13,020.22 respectively.

53.  Yang opened Account D with an initial deposit of HK$1 million.  She began investing in stocks on 10 May 2013.  From 10 May 2013 to 7 November 2015, she made a net gain of HK$267,582.70 as follows:-

Gain / Loss	Description	Amount (HK$)	No. of Transactions
Gain	Cash Dividend	7,943.20	6
Gain	Commission Rebate	2,990.95	2
Gain	Securities Sold	2,307,319.43	8
Loss	Securities Bought	2,343,589.88	17
Gain	Stocks in hand	292,920.00	-
	Net Gain	267,582.70

54.  The affirmation of WONG Sze Long, banking operation officer of Hang Seng Bank Limited in relation to Account C is accurate and produced hereby as Exhibit P21.

55.  The affirmation of TSANG Wing-hong, officer of the Citibank (Hong Kong) Limited in relation to Account D is accurate and produced hereby as Exhibit P22.

56.  A table showing the details of all transactions in the current account of Account C between 2 April 2012 and 2 November 2015, both dates inclusive, is hereby produced as Exhibit P23.

57.  A table showing the details of all transactions in the savings account of Account C between 2 April 2012 and 2 November 2015, both dates inclusive, is hereby produced as Exhibit P24.

58.  A table showing the details of all transactions in the US$ account of Account C between 2 April 2012 and 2 November 2015, both dates inclusive, is hereby produced as Exhibit P25.

59.  A table showing the details of all transactions of Account D between 1 June 2012 and 2 November 2015, both dates inclusive, is hereby produced as Exhibit P26.

Other Matters

60.  The defendant has a clear record.

61.  The defendant’s identity is not in dispute.

62.  The details contained in the tables produced as Exhibits P5-9 and 12, 23-26 are accurate.

63.  The statements of Ms CHAN Wai-wa of Inland Revenue Department are admissible as evidence without further proof.  Accuracy of their content is admitted.  They are being produced as Exhibit[s] P27-31.

64.  The provenance and chain of all exhibits produced by the prosecution are admitted.

Summary of the defendant’s two VRIs

Defendant’s 1^st VRI taken between 1305 and 1536 hours on 2 November 2015

65.  The defendant was born in Dongguan.  She has a younger sister called Yang Yanqun (YYQ).  YYQ bit by bit placed money into the defendant’s HSB account (Account B); as to details, the defendant could not recall.  YYQ was about to come out to make investment and wanted to do so after 2007/2008, so she placed the money with the defendant first for the time being.  That time, YYQ was not able to open an account yet.  YYQ had investments in Yuen Long. YYQ placed the money here slowly and gradually for decoration, for paying deposits and whatnot.  Later, in the following years, nearly all of that money had been taken back.  YYQ has opened her own account, so there was money in and out.  YYQ invested in restaurant.  YYQ and her husband made garment accessories.

66.  YYQ came down to HK often.  The restaurant and seemingly the container yards are under YYQ’s name but the defendant is not so clear about them.  YYQ had a larger share in the restaurant named Carboni in Sai Ching Street, Yuen Long.  The container yard for lease is also in Yuen Long, but the defendant doesn’t know how to state the detailed address.  The defendant also did not know how YYQ made her investments.

67.  In the past, YYQ could not come out (to HK) very often; and she could not open an account yet.  YYQ only always came here afterwards.  The defendant wasn’t sure if the restaurant opened in 2009/2010.  Previously, YYQ was not able to open bank account.

68.  It was in 2008 to 2010 (the time the restaurant opened) that YYQ put money into the defendant’s account as a rough recollection.  After YYQ opened her own account, the defendant’s account was not required.

69.  Sometimes, when the defendant went to the Mainland, she would take the money to HK for YYQ.  This was not frequent, each time being about $100,000 odd in cash, exact amount not clear.  Sometimes, YYQ would take the money herself on her own.

70.  The defendant did not know how to do bank transfers.

71.  Whenever YYQ needed the money, she would ask the defendant to take it back and deliver it to someone eg for paying deposit and whatnot.  YYQ would ask the defendant to do so when YYQ was not able to come out.  If YYQ was able to come out and did come out sometimes, she would take it herself together with the defendant.  Occasions fro paying included paying the restaurant (Vietnamese/Carboni) for decorations and for buying things.  All the deliveries were in cash withdrawn from bank counter because the defendant did not know how to issue cheques.  It seems that the defendant had not made any transfers.  The cash withdrawals were done in the branches most convenient to the defendant at the time and had occurred in Nathan Road branch and Tsz Wan Shan branch.  The defendant could not recall the details of these withdrawals because they happened over so many years.

72.  The defendant was educated to F2; she was married in 1985 and now has two sons (one working in Disney, the other one not yet working).  The defendant has one elder brother named Yang Guochu and two younger sisters (named YYQ and Yang Xuejing).  The defendant had frequent contacts with the two sisters but not very frequent with the elder brother.

73.  The defendant herself worked as a home helper and outsourced cleaner; that she did not belong to any particular company.  She had monthly income of $20,000 from being home helper and cleaning eg in many bars in Hillwood Road. The defendant was usually paid in cash but there were occasions when her income was transferred to her Chiyu bank account.  The defendant would also sometimes speculate in stocks by placing cash with YYQ.  It seems that YYQ has a stock trading account at Citibank.  The defendant did not want her husband to know she did this.  She currently has a share of the stocks there.  She has been giving YYQ cash for the past two to three years for this purpose totally three (or) several hundred thousand dollars.  The money came from her income from working for so many years.  The defendant made profits of $100,000 odd from speculating in stocks whereas YYQ made profits of $700,000-800,000.  The defendant’s profit was collected in cash (mostly in $1,000 banknotes) and was placed in safe deposit box and not in a bank account for the reason that queuing up was troublesome.

74.  The defendant would return to the Mainland whenever there were matters to deal with eg returning to her Dongguan home, visiting graves or travelling. Each time she would stay three or a few days but sometimes there were day return trips.

75.  The defendant spent on groceries only.  Her monthly expenditure was three or several thousand dollars only.  She has accumulated savings of several hundred thousand dollars thus far.  Her son gave her $4,000-5,000 housekeeping money.  A kid on CSSA, named TSANG Ka-hei gave her $1,500 as his food expenses each month.

76.  The HSB account was the only other account she had in HK.  Apart from giving money to YYQ to put into her Citibank account to invest (speculate), the defendant had no other investment.  The defendant also bet on horses and played games in Macau.  She has a betting account at HKJC.  She would bet on horses by telephone, placing $8-10 on each race.  She won more than lost in races.  She left every time after winning ten or several thousand dollars.  In total, there had been probably about $100,000 odd.  She followed some old ladies to place the bets; she went with some old ladies to play together.

77.  Apart from the safe deposit box in BOC, the defendant had no other safe deposit boxes.  She used ATM cards less often but sometimes she would use the ATM deposit service eg when she did not want to queue up.  She would deposit a few thousand and a few thousand in this way.  The defendant did not know how to use ebanking.  For taking back the money or lending money to others, the defendant would need to withdraw large amounts of money.  For lending, she would withdraw thirty or several ten thousand dollars.  Sometimes, the lending was just several thousand dollars.  Sometimes, she would withdraw the loan sum by ATM; other times she loaned the cash on her person.  The repayment of loan would be by way of cash.  The loan amount ranged from $5,000-10,000 although there had been one or two occasions of thirty or several ten thousand dollars.

78.  HSB never sent any letters to the defendant.  To find out the current balance in the HSB account, the defendant would update the passbook where necessary.  The reason why the defendant opened the HSB account on 11 January 2007 was so that there would not be conflicts between her own money and YYQ’s money.  Initially, the HBS account was for the defendant’s own use, but later it was used for storage of YYQ’s money until YYQ had her own account. Regarding the transactions in her account involving transfers to and from other accounts, the defendant could not recall the details because of the time lapse.  The defendant vaguely remembered paying university tuition fees of her youngest son by transfers.  Regarding the other transfers out, they could have been done by YYQ together with her at ATM when YYQ was in HK.  Sometimes it was the defendant who entered the numbers, other times it was YYQ who did it.  YYQ also knew her ATM PIN although the ATM card was kept by the defendant.  YYQ knew the PIN because when they went to use the ATM together, the defendant told her then.

79.  The defendant was clear that the $3M odd deposited into her account between 2008 and 2013 came from YYQ.  The money was for setting up company with withdrawals and deposits.  During that period, YYQ did not come to HK very often because her travel document did not allow her to come at any time, whenever she wanted.

80.  The defendant made deposits and withdrawals in respect of this account according to YYQ’s instructions eg when YYQ was to receive a share of money from the company, that amount of money would be deposited back into the account.

81.  Regarding the series of QDM (ATM) deposits made in May 2011, the defendant said that she made the separate deposits in one day for YYQ through the machine to save the trouble of queuing up.  The money was YYQ’s proceeds from the restaurant or the share obtained from the container yard.  That time, YYQ could not come out to HK; hence the defendant deposited the money received for YYQ.  The defendant did this on YYQ’s instructions.  The defendant acted as an intermediary.  At that time, the defendant’s HSB account acted as a repository of YYQ’s money.  It happened that at least one business partner (particulars forgotten) of YYQ who gave money back to YYQ.

82.  As regards another series of ATM deposits in March to April 2012, involving many deposits of $10,000 each, the defendant could not recall what they were.

83.  The defendant had withdrawn money from HSB account to go gambling in Macau.  Previously the defendant went to Macau quite often (two to three times in a month); now less.  Each time, the defendant gamble three or several ten thousand dollars.

84.  When asked about the withdrawal of cash of $353,000 on 27 June 2011 the withdrawal slip of which had a remark of withdrawal for purpose of buying goods in Macau, the defendant had difficulty remembering what happened.  Initially, she said that there were a large group of people going to Macau with her, hence the big withdrawal; however, later she corrected the version to the following: that time, the defendant went to the bank with a female (aged) friend before going to Macau together.  The friend (who had just returned to Taiwan) joked to the bank staff that they were to gamble in Macau.  In fact, the money was not to be taken to Macau, but for taking back to someone for the projects.  During that period, the defendant did go to Macau more frequently.

85.  The defendant reiterated that the $353,000 was taken out on YYQ’s instructions and for the purpose of the restaurant.  The money was taken to the restaurant in Yuen Long but the defendant could not quite remember the time at which she did so.  When asked if she took the money to Yuen Long right after the withdrawal (marked as happened at 12:37), she said yes.  The money was withdrawn at the Mongkok branch.  The friend had a banking account there which obviated the need for queuing.  The defendant took Route 268, 68X bus to Yuen Long and returned also by bus.

86.  When confronted with travel record of her departing for Macau on 27 June 2011 at 1321 hours, the defendant acknowledged she did go to Macau but she could not remember the details.  The defendant now could not remember if she took the money to Yuen Long immediately after withdrawing the same from the bank.

87.  The defendant confirmed that in any event she did take the money to Yuen Long but as regards details she could not remember.  The defendant now varied her version a bit to accommodate the possibility that she could have taken the money to Yuen Long on another day.  She could not remember if she had gone to Macau with the money or whether she had temporarily placed the money in the aged female friend’s home.

88.  Having been told that according to the travel record, the defendant had stayed in Macau on that occasion for about 9 hours, she said that each time she would stay that long.  On that occasion, the defendant had gambled in Sands Casino; that she had taken three or several ten thousand dollars there as usual.  Most times, she went to Sands.  On that particular occasion there were 4 to 5 persons who went together, all housewives known from work.

89.  When asked about the withdrawal on 8 April 2011 of cash of $400,000, the defendant could not remember it but she was clear that YYQ had never instructed her to take money to Macau or Mainland to settle payments.  There were three or several withdrawals in which the amount was large and they were money given to someone in connection with running YYQ’s shop or company ie the container yard and the restaurant.  The money was mostly delivered to someone in Yuen Long or a tea restaurant (café) details of which the defendant could not remember.  The actual usage of the money was unclear to the defendant.

90.  When asked whether she could have taken the $400,000 cash across the border to Mainland on 10 April 2011, the defendant said that she could not recall.

91.  Regarding the total withdrawal of $480,000 over the period from 30 September to 6 October 2011, the defendant said she could not recall.

92.  Regarding her leaving HK in April (2011), the defendant said she should have gone to visit graves.  Regarding the apparent coincidences of record of leaving HK after withdrawing large amounts, the defendant said it was impossible.  When asked if she might have taken the $300,000 to 400,000 to Macau/Mainland, the defendant said she could not recall.

93.  Regarding the following counter withdrawals, the defendant could not remember them except item (8) below: (1) 22 Feb 2008, $190,000; (2) 3 June 2008, $70,000; (3) 16 June 2008, $5,000; (4) 25 July 2008, $30,000; (5) 6 Oct 2009, $200,000; (6) 28 Dec 2009, $300,000; (7) 8 April 2011, $400,000; (8) 27 June 2011, $353,000; (9) 30 Sept 2011, $200,000; (10) 4 Oct 2011, $250,000; (11) 15 Nov 2011, $3,800; (12) 28 Nov 2011, $40,000; (13) 16 June 2012, $3,000; (14) 27 Sept 2012 $2,000; (15) 28 Feb 2013, $452,400.  In general, the defendant said that whenever YYQ said a certain amount was needed to be withdrawn, the defendant would withdraw it.

94.  For large sums, the defendant said she had to queue up at counter.  The defendant said, in general, for small sums, she would use ATM to withdraw, otherwise she would queen up at counter.  For item (11) above, though a small sum, she had to use counter because she needed to deposit tuition fee into her son’s school account at HSB.  For item (13), she must have seen there was no one queuing, therefore she used counter service.

95.  For the large counter withdrawals, they were in connection with YYQ but the defendant could not remember the details.

96.  Regarding the ebanking deposits (mostly several thousand dollars only with one to the extent of $32,700) to her account between 3 Nov 2009 and 8 March 2010, the defendant had no idea as they were not done by her.  As regards these trivial amounts, YYQ did not mention them.  Between the defendant and YYQ, when they came out, they checked the grand total only with the book (passbook?).

97.  When asked if she had thought about the source of these ebanking deposits, the defendant said no.

98.  The defendant denied that she was a rubber stamp in respect of the use of the account.  She insisted that YYQ instructed her to give the large sums for her.

99.  The defendant had never had a serious understanding of the source of the money or its use but she knew that YYQ did several businesses with someone else.

100.  Regarding the following (all but two) counter deposits, the defendant could not remember them except item (5): (1) 14 Feb 2008, $147,000; (2) 27 Feb 2008, $6,000; (3) 4 March 2008, $20,000; (4) 14 March 2008, $3,000; (5) 16 April 2008, cheque $50,000 from Chosewide Trading & Garment; (6) 17 May 2008, $2,000; (7) 26 May 2009, ebanking transfer deposit $15,000; (8) 15 June 2009, $5,830; (9) 23 July 2009, $152,000; (10) 29 July 2009, $134,500; (11) 11 Aug 2009, ebanking deposit $6,400; (12) 7 Oct 2009, $190,000; (13) 10 Feb 2010, $400,000; (14) 16 August 2011, $250,000; (15) 11 Feb 2012, $180,000; (16) 31 May 2012, $500,000.

101.  For item (5), this person engaged in garments surnamed Yip repaid $50,000 to YYQ.  In fact, he owed YYQ $600,000 or so; many transactions (some in cash) were related to him.

102.  However, the defendant was able to say that all the counter deposits were made by her.  The money was either given to her by YYQ or was money someone owed to YYQ.

103.  The defendant reiterated that the reason why YYQ placed the money with her was that YYQ intended and prepared to come over to invest.

104.  Regarding the safe deposit box the defendant opened at the BOC, the purpose for opening it was to place her jewelry there, and sometimes to place money there to save the trouble of having to queue up.

105.  As regards the cash found by the police in the safe deposit box, the defendant said that the majority belonged to YYQ; the defendant herself had several hundreds of thousand dollars.

106.  The reason for placing the cash in the safe deposit box was that previously, the defendant and YYQ pooled money together for speculating in stocks; but recently the market was not so good.  So, after taking profits previously, the money was retained there without use for speculating.  The reason for not putting the money in bank account was that the stock trading account was in Citibank, hence it was not convenient to place in her bank account.  YYQ’s portion of the money came from the Mainland.  Defendant’s portion (including profits) came from the Citibank stock trading account.

107.  The reason for not putting the money in her BOC bank account was that it was crowded on several occasions and also it was inconvenient to transfer. Previously, the defendant had taken cash over to deposit in the account for buying stocks.

108.  The defendant placed the items in the safe deposit box; YYQ had never entered the vault.

109.  The reason for this arrangement for placing the investment funds in the safe deposit box was so that the defendant could take out money from it and deposit the same into the Citibank account which YYQ (not very often in HK) could operate by phone in order to buy stocks.  YYQ said that making inter-bank transfers was possible only by prior arrangement and was troublesome.

110.  The defendant said that the investment funds were only taken out just two months ago.  The defendant said that in 2014 and 2015 she and YYQ made huge profits on many occasions from buying stock number 1094 and buying Sam Sam Tong (Sau San Tong?) from Zhongshan.  The defendant and YYQ would discuss on what stocks to buy and then YYQ would place buy orders by phone.  The price at which the stock would be sold would be roughly discussed.

111.  For stock buying, the defendant would hold a minority share; YYQ would hold majority share.  Cash would be placed into the Citibank (just on the opposite side) account when investing.  Once there was a win, the profit would be shared.  When YYQ came out, cash would be withdrawn and shared.  The market has not been that good recently; so only the defendant bought several hundred thousand shares while YYQ didn’t.

112.  So for the HK dollars in the safe deposit box, the defendant owned $400,000.  For the USD, it was for her niece – daughter of elder brother – who goes to US for studies.  It was YYQ who was responsible for paying the tuition fees for the niece.  YYQ would remit USD to the US twice every year from her own HSB account.

113.  However, for depositing more than the daily limit of USD1,500, a service fee was chargeable.  So the defendant whenever she was free would deposit the daily limit into that account.

114.  Whenever YYQ was free, she would exchange USD at currency exchange shop and then passed the USD over to the defendant; the latter would then split the required amount of USD (tuition fee) into a number of sums of USD1,500 and deposit the sums to YYQ’s bank account on separate days which YYQ would later remit in one go, twice a year.

115.  For the Japanese Yen, it was like this.  In April/May 2015, there was a group of 20 odd Mainlanders (including YYQ) who went to tour in Japan.  They had exchanged through the defendant some Japanese Yen (a number of exchanges spanning over a period from 2014).  However, after they arrived there, they discovered that they could use Union Pay card to buy things.  They used some of the Yen but the remainder was returned to the defendant here for their future use in another trip at the end of the year, or the beginning of 2016.

116.  The reason for not saving the remaining Yen in a bank account of YYQ was that it was unknown if Yen could be deposited into YYQ’s bank account; another reason was that some of the Yen belonged to the others; a third reason was inconvenience for converting to and fro; a fourth reason related to exchange rate.

117.  The defendant and YYQ were relatively close.  They would meet 8-10 times each year.  There were a lot of contacts (majority were phone contacts) between the two.  But these days, Whatsapp would be used.

118.  Although the defendant was familiar with YYQ’s husband, she did not know if he knew YYQ had let the defendant so much of her money.

119.  About the trivial deposits (by ebanking?) made into her HSB account, the defendant did not know about them nor did she ask YYQ about them.  The defendant would only account to YYQ about the balance and grand total on the updated passbook with YYQ when the latter came out.  YYQ would sometimes jot the figure(s) down in a book.

120.  As regards the delivery of larger amounts of money withdrawn from her HSB account, sometimes she would take them to someone in Yuen Long, other times someone would come to her in Kowloon to collect them.

121.  On delivery, initially the defendant said that (sometimes) the defendant and the recipient would both sign on a piece of paper as a kind of receipt which will later be passed to YYQ by the defendant.  However, the defendant later said that normally no receipt will be signed; but if there was a need for issuing a receipt by the opposite party, the paper would be prepared by the opposite party and signed by either the defendant or the opposite party as appropriate.

122.  Now the money in the defendant’s HSB account belonged to her only because she had settled the account with YYQ in 2013 or 2014.

Defendant’s 2nd VRI taken between 1554 and 1558 hours

123.  There was nothing significant contained in the defendant’s 2^nd VRI.

Prima Facie case

124.  The admitted facts and the exhibits produced thereunder constituted the entire prosecution case.  Prosecution declared the close of the prosecution case.  I ruled that there was a case to answer on both charges.  Defendant elected to give evidence and to call two other defence witnesses.

Summary of DW1’s ie defendant’s evidence

125.  DW1 was born in 1963 and educated in Mainland to F2 level.  She became a HK permanent resident in 2007/2008.  DW1 has a clear record.  She is married with 2 sons (aged 30 and 28).  Her husband is an electrical technician earning $20,000 a month.  She herself is a domestic helper and cleaner.  The whole family live in a public housing flat in Tsz Wan Shan.  She has a younger sister YYQ who lives in Dongguan, Mainland, who is engaged in garment accessories business together with YYQ’s husband.  DW1 would see YYQ from time to time when the occasion arose.  They spoke on the phone quite frequently.

126.  DW1 opened her HSB account in January 2007.  Initially, it was for her own use.  In 2008, YYQ asked to use it for collecting payment for goods and also paying others in HK both in connection with her garment accessories business.  It started when on one occasion YYQ asked her for the account number for receiving payment.  DW1 then stopped using that account for her own purpose.

127.  During that time, YYQ could not come to HK often because of immigration restrictions.

128.  Regarding the total deposits of approx HK$3.3M placed into the HSB account during the charge period of Charge 1, the money all belonged to YYQ.

129.  During 2000-2013/2014, YYQ worked as purchasing manager of Xihu Hotel in Mainland.  She earned a salary of a few tens of thousand per month plus commission.  She was also assisting her husband in the garment accessories business.

130.  YYQ started garment retailing in 1984-85 after the opening-up of China. Profit were high at that time.  To DW1’s knowledge, YYQ was successful and accumulated a substantial amount of savings.

131.  Between 1995/1996 and 2001, DW1 and YYQ operated a guesthouse together in Dongguan, Mainland. They equally shared profits of RMB50,000 each month.

132.  During the period from 2008 to sometime in 2012, YYQ did not have a bank account in HK.  Later, YYQ was told by her subsequent business partners that she could open an account in HK; so YYQ opened one in April 2012.  However, YYQ continued to use DW1’s HSB after April 2012 because YYQ’s (new) account was to be used for her company and also it was not convenient for her to travel to HK at that time.

133.  The deposits/withdrawals in DW1’s HSB during the charge period are principally accounted for in the following 9 ways.

134.  First.  Collection of payment for goods and Paying out to others for purchases both in connection with the garment accessories business.  DW1 would quite often act as an intermediary by collecting and depositing or withdrawing and delivering the cash.  These deposits include items 128-132, and 134-135 on P5A.  Sometimes, money was deposited by others without DW1’s participation by cash or transfer (items 2 & 3 on P5A).  The total deposits under this head amounted to $1M.

135.  Second.  For purchasing dried seafood for YYQ in her capacity as purchasing manager of Xihu Hotel.  This happened quite often ranging from $10,000 to a maximum of $300,000 on one occasion (item 73 on P5A).  Another time was item 59 (6.10.2009) when there was a withdrawal of $200,000 – YYQ also came and they went to buy together but in the end, they only bought one catty of birds’ nest.  So the remaining sum of $190,000 was deposited back on the next day to the account (item 60).

136.  Third.  Repayment of loans extended by YYQ.  A HK resident F/Chiu Shui Kuen had borrowed $100,000 to 200,000 from YYQ in the Mainland.  Chiu made repayments through transfers to DW1’s account.  These include items 43-46, 51, 56-58, 62, 65-72 on P5A (amounting in total to $224,000).  Item 61 (ATM transfer out) relates to an extra loan of $30,000 made to Chiu.

137.  Another similar loan was made to a Mr Yip (DW1 Heard that it was of an amount of 600,000).  Yip made a repayment by cheque of $50,000 which DW1 collected in person.  DW1 deposited it into the account on 16.4.2008.  There were other repayments by cash/transfer but DW1 could not provide the details. The cash amounts were like $10,000 or $20,000 but DW1 could not quite remember because of time lapse.

138.  The repayment of loans by Chiu and Yip amounted to $400,000 odd in total.

139.  Fourth.  Payment of DW1’s son YIP Pui Yuen’s CUHK tuition fee twice courtesy of YYQ.  YIP’s CHUK graduation diploma was produced as exhibit D1. The two transfers (amounting to $52,381) to CHUK account were items 159 and 169 (the latter outside the charge period).  This total sum together with $20,000 DW1 took from the account (with YYQ’s approval) for a gambling trip to Macau amounted to $100,000 (sic).

140.  Fifth.  Withdrawal of nearly $100,000 by ATM in the past few years for buying computers and mobile phones when children of YYQ and those of DW1’s other sister came to HK.

141.  Sixth.  $150,000 was withdrawn (item 181) on 2.5.2015 (related to Charge 2) for exchanging into USD in order to support DW1’s niece to study abroad. After DW1 exchanged it, she put the USD into the BOC safe deposit box.

142.  Seventh.  For investing in the companies operating the restaurant and contained yard in which YYQ had a share.

143.  The restaurant started as a Vietnamese restaurant after the lunar New Year of 2011; it changed into a Western style restaurant called Carboni in 2013/2014.  It was situated in Sai Ching Street, Yuen Long.

144.  To DW1’s knowledge, YYQ intended to invest around $1M in the restaurant business.

145.  Examples of cash deposits made by DW1 into account for investment into the restaurant/container yard business were items 99-111 of P5A.  Here, YYQ got someone to bring $500,000 to DW1 at Yuen Long.  The sum was split up into smaller amounts and deposited into the account by ATM on neighboring days because there was a deposit limit each time set by the machine.

146.  DW1 had taken cash to YYQ’s business partners at the restaurant on YYQ’s instructions several times.  To a male called Peter were delivered cash of $400,000 and $500,000 (the latter items 124-127 plus $20,000 from collection from payment of goods).  To Peter’s young brother (a manager) was delivered cash of $350,000 (from the $353,000 withdrawn on 27.6.2011 as per item 112, the remaining $3,000 having been spent on buying something for YYQ).  These sums could be for either the restaurant or container yard business.

147.  Eighth.  Investment in vessel delivering construction waste to the Mainland for reclamation.  It was intended that $500,000 be invested in the business through a man surnamed Tang called Chik Goh; hence a deposit on 31.5.2012 (item 152) of $500,000.  Later, on 28.2.2013 (item 160), a sum of $452,400 was withdrawn from which $450,000 was handed over by DW1 to Chik Goh at Sik Kong Village in Yuen Long.  The other $50,000 of the intended investment sum had already been given as a deposit by YYQ to Chik Goh when he went to the Mainland previously.

148.  Ninth.  Originally some of the monies had been earmarked for YYQ’s son’s intended studies in HK or overseas: they came from two sources: (1) $152,000 was deposited (by unknown person) into the account being payment for goods (item 52); (2) $134,000 being payment for goods was deposited into the account by DW1 (item 55) who herself collected it on behalf of YYQ.  However, eventually, YYQ’s son got into a good university in Mainland, and therefore the monies were not used in that way.

149.  The two set of monies were later used for investment and for paying the tuition fees of their niece.

150.  In conclusion, DW1 said that it never crossed her mind that the monies she dealt with in her account had been the result of any criminal activities. DW1 believed that the monies came from YYQ’s business gains and salary in the Mainland.

151.  DW1 said that she had never taken funds from HK to Mainland.  There were occasions when YYQ had taken funds (around HK$100,000 each time) from Mainland into HK and which were subsequently deposited into DW1’s account.  DW1 also had the experience of taking around HK$100,000 from Mainland to HK several times and deposited them into the account.

152.  Once (date unknown), out of curiosity of how it happened that YYQ had so much money, DW1 asked her jokingly where the money came from.  The question went like whether YYQ had invested in some stocks on her own without including DW1 as a partner.  YYQ answered of course not and it came from proper source.

153.  Regarding written receipts for monies delivered by DW1 to others, DW1 said that for large sums, eg sums like $350,000 or more, the recipients would write out a receipt and they were later given to YYQ.

154.  Regarding the BOC safe deposit box, it was initially opened for the reason that DW1 found that a live-in kid supported by her had stolen money from her.  She discussed opening the box before taking action to open it.  She used the box for three purposes: (1) for putting in jewelry; (2) for placing cash received from YYQ into it whenever it was inconvenient for DW1 to make deposits; (3) for placing valuables in it before going to Macau.

155.  DW1 went to Macau to have entertainment (including gambling) quite often with people known from work.  Each time, she would bring $20,000-30,000 (either from cash in her hand or from the safe deposit box).

156.  At the time of arrest, the USD and the Japanese Yen belonged to YYQ. Out of the HK$1.953M, $400,000 belonged to DW1, rest belonged to YYQ. Regarding the HK$, YYQ intended to use her part to speculate on stocks.  As the Mainland market was experiencing a low, so funds were taken to HK and placed in the safe deposit box in preparation for speculation.

157.  How it happened was YYQ had asked someone from the Mainland to bring to HK one million or so.  Then it was exchanged into HK$; DW1 placed it into the safe deposit box.  However, it was not invested into the market.  So HK$1.5M belonged to YYQ.  For the $400,000 odd which belonged to DW1, it came from principal and profits of a previous speculation in stocks exercise conducted by YYQ on behalf of DW1.

158.  The USD59,200 in the safe deposit box belonged to YYQ.  It came from collection of payment for goods and the $150,000 from DW1’s account which was exchanged into USD.  DW1 would take USD1,500 from the safe deposit box and deposit the same into YYQ’s HSB account whenever DW1 passed by and saw that there were not a lot of people in HSB.  This was to avoid the daily deposit limit fee chargeable by HSB.  The USD was for their niece’s tuition fee.

159.  The Japanese Yen in the safe deposit box came from YYQ.  Originally, YYQ asked DW1 to exchange Japanese Yen for a trip to Japan participated by YYQ and some 20 other people in April or May 2015.  They did go to Japan with the exchanged Yen but found that they could pay with Union Pay cards with discounts too.  After YYQ came back, she gave DW1 the remaining Yen and told her to place it back into the safe deposit box for the next planned trip at the end of that year.

160.  DW1 did not know the separate share distribution of the Yen among the 20 odd people.

161.  Under cross-examination, DW1 said that although there was still substantial amount of money ($450,000 odd) in her HSB account at the end of 2014 (which was the time she settled the accounts with YYQ), that money belonged to DW1, because there had been some separate settlement between her and YYQ so that the $450,000 became DW1’s money.  That separate settlement related to some stock speculation.  Similarly, although the money ($150,000) withdrawn on 2.5.2015 (item 181) technically belonged to DW1, she used it to exchange into USD on behalf of YYQ because there were still money transactions between her and YYQ (speculating in stock through YYQ’s or her husband’s stock account) and so the two sisters did a calculation between themselves.

162.  Regarding items 59 & 60 of P5A, DW1 could not explain the discrepancy between YYQ’s travel record and DW1’s claim that YYQ was in HK to buy seafood with her in Western save to say that her memory could be faulty.

163.  DW1 clarified that she knew how to do transfers through ATM, but not through ebanking.

164.  DW1 explained why she was not scared on some occasions when apparently she either carried a large amount of cash on her person or seemed to have deposited cumulatively a large amount of cash through ATM machine.  In summary, she said that it depended on the situation.

165.  Regarding the withdrawal on 27.6.2011 of $353,000, she said that it was definitely not the case that she took the money straight to Yuen Long after withdrawal.  However, she could not remember whether she took the money to Macau or temporarily left it at the home of her aged female friend who lived in Kwong Wah Street near the bank.

166.  DW1 denied the suggestion that she took the withdrawn cash on many occasions to either Mainland or Macau.

167.  DW1 pointed out that the funds intended by YYQ for investment were often deposited in DW1’s account many months in advance once negotiation had started.

168.  DW1 did not find it suspicious that large sums of money had to go through her for depositing into her account whereas it could have been done by the deliverer without involving her.  It did not occur to her that the deliverer could do the depositing him/herself.

169.  Once or twice, DW1 might have issued receipt by writing and signing on a piece of paper when she received payment for goods on behalf of YYQ.

170.  DW1 clarified that she could not be sure whether it was from YYQ’s Citibank account that cash was withdrawn and then passed to DW1 after there was a gain in stock speculation but DW1 did say that there was a transfer of money from YYQ’s Citibank account to the latter’s husband.

171.  DW1 said that the money she used for speculation in stock was given to YYQ; as to whether YYQ placed it in the latter’s Citibank account DW1 could not be sure.

172.  Under re-examination, DW1 said as regards the three day trips to Mainland shortly after withdrawing sums of money from her HSB account, she could not remember the purpose because of the time lapse.  DW1 sometimes made day trips to Shenzhen; mostly she returned to the Dongguan Shek Lung home to visit her mother.

DW2 YYQ

173.  In chief, DW2 gave evidence which generally supported and at times reinforced DW1’s evidence.

174.  Under cross-examination, the prosecution had managed to unearth a few discrepancies between DW2’s evidence and her previous statement with the police.

175.  Nothing of significance came out of re-examination.

DW3 Tang Wai Keung

176.  DW3 is the younger brother of Peter Tang Tim Shun and was the manager of Bamboo Vietnamese Restaurant at the material time.

177.  In chief, DW3 generally supported the version given by DW1 regarding the delivery of $350,000 to the restaurant on or about 27 June 2011.

178.  Cross-examination did not unearth anything significant.

179.  There was no re-examination.

Close of the defence case

180.  Before close of the defence case, Defence confirmed orally that the parties agreed that the several passages in DW2’s VRI that she read out in court were an accurate record of that part of the VRI.

181.  Defence closed their case.

Prosecution’s final submissions

182.  Prosecution adopted their written submissions (with some amendments) which were supplemented by oral remarks.

Defence’s final submissions

183.  Defence adopted their written submissions which were supplemented by oral remarks.  Defence also submitted an additional authority of HKSAR v Yan Suiling (2012) 15 HKCFAR 146.

Analysis of the evidence

184.  I have considered all the admissible evidence and the parties’ final submissions including the authorities submitted.

185.  I remind myself of the burden and standard of proof in a criminal trial.  In particular, the defence has to prove nothing and certainly does not need to prove the defendant’s innocence.  I have considered the two charges separately although I guard against the danger of inconsistent verdicts.

186.  I bear in mind the defendant’s clear record, which means that her testimony both in the witness box and what she told the police prior to trial are more likely to be true, and she is less likely to have committed the offences at this stage of her life, than would otherwise be the case.

187.  I also bear in mind the background of the defendant namely she was a part-time cleaning lady with an educational level of F2 obtained in the Mainland.  She also had a stable family.

188.  One must also not forget that the events in this case happened some time ago – 2008-2013 in the case of Charge 1, and 2015 in the case of Charge 2. People’s memories are imperfect and fade with the passage of time.  Where appropriate, allowance should be accorded to the witnesses.

189.  I note that in this case, the concern is what was within the cognizance of the defendant.  Hence, evidence which normally would have been regarded as hearsay for being information represented to the defendant by other people would still need to be considered, not as truth of the contents but as constituents of what was in the mind of the defendant.

190.  The prosecution case is by way of admitted facts.

191.  Looking at the prosecution case alone, it cannot be denied that a large cloud of suspicion is created over the defendant for possible money laundering because of the huge amounts of money that went through her bank account and the slightly lesser amounts of HK$ and foreign currencies that were found in her safe deposit box, despite her humble means.

192.  The suspicion is aggravated by the fact that most of the movements in the account were conducted by way of cash; and sometimes a sizeable amount of cash in a single transaction or a single series of transactions was involved.

193.  That suspicion is further aggravated because the defendant was a frequent traveler to the Mainland and Macau, sometimes just for day trips.

194.  Hence, by the close of the prosecution case, there was a reasonable basis upon which the prosecution could ask the court to draw an inference of money laundering.

195.  Here, the defendant elected to give evidence and also called two other witnesses to testify on her behalf.

196.  In this case, without a doubt, the most important defence evidence would be the defendant’s ie DW1’s evidence; the evidence of DW2 and DW3 are useful to an extent insofar as they might be used to test the credibility and reliability of the defendant’s evidence, with the court bearing fully in mind the burden of proof always lies with the prosecution.

197.  I have examined carefully the evidence of the defendant.  I found that she was doing her best to explain the ins and outs of her account to the extent she was able.  As a result, most if not all of the movements (certainly the significant ones) in her account during the charge period (Charge 1) had been explained.

198.  In respect of Charge 2, by and large, the defendant was able to add flesh to the skeleton of what she told the police in the 1^st VRI.

199.  I also found a striking similarity, where available for comparison, between the defendant’s evidence and her 1^st VRI with the police. There were the occasional discrepancies, granted, but I do not find them to be significant.

200.  When tested against the evidence of DW2 and DW3, I do not find any significant discrepancies between the defendant’s evidence and either of their evidence.

201.  Throughout the trial, I have been closely monitoring the manner in which the defendant gave evidence; I found that her responses were generally instantaneous and to the point and she was doing her best to assist the court.

202.  I have also seen in court with the parties how the defendant performed in the VRI.  Again, I found her forthcoming whenever she could, allowing for the lapse of time between the events in question and the interview which was conducted in November 2015.  It is to her credit that she was able to tell as much during the VRI despite the fact that she was arrested only on the morning of that day.

203.  I found what the defendant told the court in evidence could (save where it directly conflicts with a piece of agreed evidence such as the travel record) have been the truth of the matter and her explanations were possibly valid in general.  In this connection, I note the close relationship between her and her younger sister YYQ and the bond between them which provided the background to all the events in question.

204.  Although less important in and of themselves, I also found the evidence of DW2 and DW3, insofar as relevant to the case of the defendant, possibly true.  In this respect, I accept as possibly true DW2’s evidence that it was her usual practice to use cash (see for example the opening of her Account D by depositing cash of HK$1M) and that could be the reason why she instructed the defendant to deliver and collect cash on her behalf.

205.  Consequent upon the above findings, I find that there is a doubt in the prosecution case on Charge 1 and Charge 2.  Put another way, it is possible that when the defendant dealt with the property subjects of Charges 1 and 2, she did not have reasonable grounds to believe that they represented proceeds of indictable offence in whole or in part directly or indirectly.

206.  Although this will be sufficient to dispose of the case as far as the defendant is concerned, in deference to the prosecution, I shall deal with some of the more significant points raised by them.

207.  The movement record point – the travel record shows that the defendant was a frequent short-trip traveler to the Mainland and Macau, irrespective of whether she had or had not withdrawn a large sum of money shortly prior to the travel.  The absence of further deposits into Account D point – the account had always been in funds, there was no need for further deposits.  The accounting documents point – this point is far too removed from what was in the mind of the defendant who had no dealings with the companies or the related accounting documents.

Conclusion

208.  For the above reasons, I find the defendant not guilty of Charge 1, and not guilty of Charge 2.