HKSAR v. LI PIK YEE, JOEY ROBIN

DCCC 590/2023

[2024] HKDC 440

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 590 OF 2023

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REASONS FOR SENTENCE

The defendant pleaded guilty to a charge of "Theft". Within a period of 2 years and 9 months, she has stolen a total sum of $819,266.30 from her employer.

Summary of Facts

Background

2.  Asia Pacific Beauty Group Limited ("APB")  engaged in selling beauty products and equipment.  Madam Chan (PW1)  was a director of APB; and the defendant, a sales representative ("sales rep").

3.  When a customer places an order with APB, the sales rep would fill out an Order Form stating the quantity ordered and the payment method.  Only one sales rep is assigned to each customer.  The customer may be required to pay a deposit, which can be settled by cash, cheque or credit card.  The Order Form would be submitted to the Sales Director, Madam Fong (PW2), to confirm and sign. 

4.  Thereafter, the Order Form would be sent to the warehouse for delivery.  When the products reached the customer, the customer would sign on an acknowledgement of receipt/invoice.  The sales rep would then demand payment from the customer. The customer needs to settle the payment within 1 month, which could be done by cash, cheque, bank transfer or credit card.

5.  After receiving payment from the customer, the sales rep would record it in the accounting notebook of APB, which would be verified and signed by the accounting staff.  If payment was made by cheque or credit card, the accounting staff would retain a copy of the cheque or credit card slip for record. Afterwards, the accounting staff would input the payment record into the computer system.

Discovery of the offence

6.  Between late 2016 and early 2017, PW1 noticed irregularities in the accounts of the defendant's customers.  Unlike in the past, her customers appeared to be settling their payments by cash instalments instead of paying in full by cheque or bank transfer.

7.  In August 2017, PW1 asked the defendant to demand payments in full from her customers; or otherwise APB would stop delivering products to them.  Since the payments were settled by large sums of cash, PW1 felt suspicious.  PW1 confronted the defendant.  She admitted to PW1 that between August 2015 and August 2017, she was stealing the cash payments made by some customers; and then used other customers' payments to cover the amount she had stolen.

8.  PW2 also noticed that for the month of August 2017, there was a total outstanding sum of $1 million amongst the defendant's customers.  The defendant claimed that many of her customers were travelling so she could not collect their payments.  In mid-August 2017, PW2 discovered that payments of the defendant's customers from April to June 2017 were settled, but payments from July to August 2017 were outstanding.  PW2 confronted the defendant regarding an outstanding sum of $819,266.30.  The defendant initially denied, but later admitted that she had taken money from APB from August 2015 to August 2017.

9.  On 5 September 2017, the defendant voluntarily prepared and signed a confession note in the presence of PW2, admitting and describing her embezzlement.  Her employment with APB was terminated on 6 September 2017.

10.  The defendant had agreed to repay APB by instalments; however, she had only repaid a total sum of $136,410.80 on 7 September, 12 October and 13 October 2017.

11.  PW1 reported the matter to the Police on 11 October 2017.  The defendant surrendered herself at Hung Hom Police Station on 17 October 2017.  She was arrested on the same day.  Under caution, she admitted having stolen money from APB because she had financial problems at home and she regretted it very much.

12.  In her video recorded interview conducted on 17 October 2017, the defendant admitted her embezzlement and described in details how she had committed it.  Since many of her customers, especially those from the mainland and Macau, would pay by cash, the defendant decided to keep the cash given to her by those customers for her personal use and temporary cash flow.  In order to cover the cash payments which she had stolen, she would later put money back into the customers' accounts using her own funds or payments made by other customers by cheque or credit card. 

Mitigation & Sentence

13. The defendant is 56 and has a clear record. Defence counsel Mr. Hui informed me that she is married with 2 adult daughters. She resides with her husband (aged 62)  and youngest daughter (aged 25). The defendant now works as a part-time warehouse attendant. Her husband is a part-time security guard. The youngest daughter works in a hotel.

14. In mitigation, Mr. Hui submitted that the defendant suffers from anaemia and has lost hearing of her right ear. She joined APB in November 2008 as a sales rep. She was promoted to Assistant Sales Manager in 2015 earning $15,000 to $18,000 per month. At that time, the defendant's husband had a clerical job earning about $10,000 per month. The defendant was the main source of income for her family.

15. Between 2013 and 2014, the defendant had health issues and was hospitalized many times. In August 2015, she had a major surgery. During her absence from work, she was unable to follow up on her customers. As a result, APB refused to grant sales commission to her. At the same time, the defendant's mother-in-law was sick and her youngest daughter received an admission offer from Macau University. With a sudden decrease in income and an increase in expenditures, the defendant took out loans from banks and finance companies. Feeling aggrieved by APB, the defendant recklessly took the cash payments from customers to repay her loans and for personal use, thinking that she could repay the company later on. She also gambled hoping to win enough to pay her debts. Regrettably, she failed in both. After she was terminated, the defendant repaid APB with all she had. She was declared bankrupt in January 2018.

16. I will deal with the issue of "delay" first. Prosecuting counsel Mr. Kwan has helpfully prepared a Chronology of Events for my reference. The defendant was arrested and interviewed under caution on 17 October 2017. The Police took 23 months to investigate this case and to submit the case file to the Department of Justice (DoJ)  for legal advice in September 2019. Between September 2019 and May 2022 (i.e. 2 years and 8 months), there were the 1^st legal advice and further investigation. The case file was re-submitted to DoJ for legal advice in May 2022. After 11 months, DoJ issued the 2^nd legal advice in April 2023. The defendant was charged on 19 April 2023. This case reached the magistracy on 19 May 2023 and then the District Court on 6 July 2023. After one adjournment, on 29 August 2023, a plea & sentence date was fixed for 6 March 2024.

17. In my view, 5.5 years from the 1^st cautioned interview to charging the defendant were excessive. Based on the Summary of Facts, the defendant had fully confessed to APB before she was terminated; and APB already had the numbers worked out before going to the Police. Taking witness statements from the customers was mere formalities. The customers were not cheated; APB was. Regarding the Police and DoJ, I am aware of the sudden influx of caseload in 2019 and the pandemic from 2020 to 2022. Nevertheless, there is, in my view, undue delay in bringing criminal prosecution against the defendant.

18. The defendant's courage and determination in battling against her health issues and maintaining her family are admirable. She no doubt has the "Lion Rock Spirit". Unfortunately, she used the wrong method. If she had in fact earned her commission, there must have been proper (and most importantly, legal)  ways for her to get it back. Time after time, the court has expressed in very clear terms that being in financial difficulty (however serious)  or having a sick family member is no mitigating factor for committing a crime.

19. Mr. Hui acknowledged that this case involves the Barrick type of breach of trust. He accepted that the sentencing guidelines laid down by the Court of Appeal in HKSAR v Ng Kwok Wing [2008] 4 HKLRD 1017 are applicable. According to Ng Kwok Wing, if the amount stolen is between $250,000 and $1 million, the starting point is 2 to 3 years' imprisonment.

20. The defendant had stolen $819,266.30 from her employer over a period of 2 years and 9 months. Applying a strict arithmetical approach, the starting point should be about 34.5 months, which I would adopt. With her timely guilty plea, the sentence becomes 23 months. I would grant an additional discount of 3 months for the undue delay, reducing the sentence to 20 months[1]. I sentence the defendant to 20 months' imprisonment.