HKSAR v. NG KWAN HAU

CACC 153/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 153 OF 1999

(ON APPEAL FROM DCCC 1311 OF 1998)

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J U D G M E N T

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Nazareth V-P (giving the judgment of the Court) :

1. The applicant, Ng Kwan-hau, pleaded guilty and was convicted by His Honour Judge Wright in the District Court of 17 offences. The first two, specified in charges 1 and 2, were of using a false instrument contrary to s.73 of the Crimes Ordinance (Cap. 200) and related to false applications for an Option Visa Card and an AIA Visa credit card. The next two offences, specified in charges 3 and 4, were of obtaining services by deception contrary to s.18A(1) of the Theft Ordinance (Cap. 210). The remaining 13 offences were of obtaining property by deception contrary to s.17(1) of the Theft Ordinance. The deception in each case was representing himself to be one Chan Hoi-shan.

2. He was sentenced in respect of each of charges 1, 2 and 4 to 32 months imprisonment to run concurrently; and on each of charges 3, and 5 to 17 to 24 months also to run concurrently but consecutive as to 8 months of the 32 months on each of the other 3 offences, making a total of 40 months.

3. He now seeks leave to appeal against sentence. Before addressing his grounds, it is convenient to outline the facts.

4. The applicant was employed at the material time as a "career representative" by American International Assurance Co (Bermuda) Ltd ("AIA") on commission. In December 1997, the said Miss Chan Hoi-shan applied through the applicant to AIA for an insurance policy. In April 1998, she tried to cancel the policy but was informed that the applicant had already resigned and left AIA. She also asked for the AIA Visa credit card for which she had applied through the applicant at the end of March 1998 to be cancelled. In May 1998 she was informed that her application for the credit card had been successful and on contacting the card centre of Standard Chartered Bank, she was informed that the card had already been sent to her and there was an outstanding balance of HK$8,150.70 in the account of the credit card.

5. In applying for the credit card, the applicant had used Miss Chan's particulars but his own address. Later, he also gave as his telephone number that which he had obtained by falsely representing that he was Chan Hoi-shan, giving her identity card number. Inevitably he was quickly arrested. The AIA Visa credit card was found in the back pocket of the jeans he was wearing when arrested. He admitted the offences, providing details and cooperated with the police, ultimately pleading guilty as mentioned.

6. Mr Mitchell-Heggs who represented the applicant before us pointed to the following matters. The offences were rather clumsy ones making his arrest inevitable. Moreover, the obtaining of the cards was completed in April 1998 and somewhat divorced from the use of the credit card over five days from 4 May 1998 to 9 May 1998. Thereafter, no use was made of the credit card which was found on the applicant's person as mentioned, when he was located and arrested by the police at his residence on 15 July 1998, more than two months after his last use of the credit card. He did not use the Option card at all. His use of the credit card on the 14 occasions in question was characterised by Mr Mitchell-Heggs as subsistence theft or shopping, which he contrasted to the more usual concerted attempt to obtain the maximum value from its criminal use encountered in credit card theft. That can be seen very clearly from the transactions that are the subject of the 14 charges. These, for example, included food ($323), a game CD ($317), one pair of denim jeans ($645), two CDs ($112 and $208), various goods valued at on one occasion $364.90 and on another $201.80, and so forth. The largest single transaction standing out clearly from the remainder was in respect of one television set ($2,590).

7. The judge took those matters into account and went on to say that it was important to bear in mind just how the applicant came into possession of the information which enabled him to apply for the cards. He outlined the circumstances and then continued:

"This is a clear breach of trust and a serious one. It is the experience of these courts that the most common method of obtaining information relating to others so as to apply for credit cards in their names is by the unlawful acquisition of documents - often by theft from post boxes. Here, however, the Accused was furnished with information by a client of his employer which he then subverted for his own use.

I regard this as an aggravating feature.

In a matter similarly involving applications using false information being made to a credit card company to obtain credit cards which were then used to purchase goods, the Court of Appeal has indicated that whilst the case did not concern forged credit cards it did concern false names and the offence can be characterised as credit card fraud, R v LAI Chong-ning Crim. App. 729/1996. For credit card fraud as such the guideline authority, R v CHAN Sui-to Crim. App. 115/1996, really deals with matters of greater seriousness, other than for the breach of trust aspect, than this matter.

An appropriate starting point in respect of the two charges of using a false instrument, taking into account the breach of trust, would be 4 years imprisonment. A similar starting point is appropriate in respect of the fourth charge of obtaining services by deception given that those services were obtained to facilitate the acquisition of the credit cards. Allowing the discount, the sentence reduces to 32 months imprisonment. All of those sentences may properly be ordered to be served concurrently with one another.

An appropriate starting point in respect of each of the offences of obtaining property by deception and the remaining charge of obtaining services by deception is 3 years imprisonment. Again, each sentence falls to be reduced to 2 years imprisonment and each may properly be ordered to be served concurrently with one another.

The usage of the card is separate and distinct from the obtaining of it. In my view the sentences in respect of those charges should be served consecutively. I have to have regard to the question of totality. If the full extent of each sentence were served consecutively the aggregate sentence would be 56 months imprisonment. In the context of this matter, that is excessive.

In the circumstances the Accused is sentenced to the following periods of imprisonment:

on charges 1, 2 and 4 32 months, each to be served concurrently with one another

on charges 3 and 5 to 17 24 months, each to be served concurrently with one another but 8 months of which are to be served consecutively to the sentences on Charges 1, 2 and 4."

8. In Lai Chong-ning referred to by the judge, the judge adopted 5 years as the starting point and reduced it to 3 years for a plea and offer of assistance. The Court of Appeal there upheld the sentence, stating that it was neither wrong in principle nor manifestly excessive. The offences there were clearly far more serious than here. Forty-two applications had been made to the bank for credit cards, the offences spanned a period of approximately 4 months and the total amount obtained was $128,100. We think that plainly in relation to these aspects, the applicant's offences were certainly not credit card fraud of the usual sort that were committed in Lai Chong-ning. In terms of criminality, they were of a far lower order.

9. However, there was also the matter of the breach of trust to which the judge referred. Mr Mitchell-Heggs submitted that if any one was defrauded, it had to be the Bank and not AIA, the employer. The gravamen of a breach of trust in such circumstances is that in breach of the trust duty owed to the employer, it is the employer who is defrauded. It has to be said that that is the usual position. Nonetheless, there was a duty owed by the applicant to AIA which was breached when the applicant instead of using the information gained on its behalf for AIA's purposes, used it instead for the applicant's own purposes. That said, we do not think that in the present circumstances, the breach by the applicant of his duty, whatever its precise legal characterisation may be, can be wholly equated with the usual breach of trust encountered in such cases. In the result, we do not think that the minor nature of the applicant's offences in terms of criminality to which we have referred, can nonetheless be converted by the breach of trust or other duty, into an offence of or comparable to credit card fraud of the usual sort, attracting the level of sentence suggested in Lai Chong-ning.

10. However, for our part, there does not seem to be any error of principle, and we think that the matter would be more appropriately approached in the usual way, by simply addressing the question whether the starting point or the ultimate sentence imposed was manifestly excessive. We have already outlined the aspects of the offences which not only point to criminality of a rather low degree but which themselves are most unusual if not exceptional. In that light, we do not think they should have attracted anything like the 5-year starting point mentioned in Lai Chong-ning. We think the starting points taken of 4 years in respect of charges 1, 2 and 4 and 3 years in respect of the remaining charges are too high and that they should be reduced to 3 years and 2 years respectively. Accordingly the sentences should then be reduced to 2 years and, to 16 months respectively to reflect the pleas of guilty. Whether the sentences should have been consecutive does not emerge very clearly in the circumstances. However, we do not find it necessary to decide that matter since in then addressing the totality of the sentences, we have no hesitation in concluding that this should not exceed 2 years. This total, we think, may conveniently be achieved by ordering all the sentences to run concurrently.

11. We accordingly grant leave and treating the application as the appeal, allow it, set aside the sentences and in lieu substitute in respect of the sentences on charges 1, 2 and 4, sentences of 2 years; and in respect of the remainder, sentences of 16 months, all the sentences to run concurrently.