HKSAR v. LI LAM

DCCC 1041/2025

[2026] HKDC 983

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 1041 OF 2025

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REASONS FOR SENTENCE

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The defendant pleaded guilty to a charge of "Money laundering". In short, she lent her bank account to a friend.

Summary of Facts

2.  On 5 November 2020, the defendant opened the bank account as particularized in the charge ("the Account").  She was its sole signatory.

Deception

3.  Between 28 October and 15 December 2020, Mr. Wu (PW1)  was deceived by an investment scam. He transferred two aggregated sums of US$339,500 and HK$4,889,000 to various bank accounts according to the instructions given by a fake investment app. From 20 to 23 November 2020, the Account received a total sum of HK$2,931,000 from PW1.

4.  On 16 December 2020, when PW1 tried to withdraw the funds in his investment account, he was asked to pay a 22% tax for his withdrawal.  Realizing that he was deceived, PW1 alerted the police.

Money laundering

5.  Between 12 and 28 November 2020, the Account received 69 deposits, which aggregated to a sum of HK$6,884,426 (of which HK$2,931,000 came from PW1).  A total sum of HK$6,884,047.43 was withdrawn by 59 transactions.  On 28 November 2020, the Account had a balance of HK$378.57.

Arrest

6.  On 5 July 2021, DPC 21324 (PW2)  arrested the defendant at her home for "money laundering".  Under caution, she admitted having opened the Account and having lent it to a male named "Ah Tung", who told her that he was a CSSA recipient and that it was inconvenient to use his own bank account to collect debts.  After a house search, PW2 found an ATM card for the Account.

7.  In her video recorded interview, the defendant repeated the story of how Ah Tung borrowed the Account from her.  She admitted to giving Ah Tung the ATM card for the Account and setting up the online banking service with a mobile phone number given by him.  The defendant claimed that Ah Tung would return the Account to her after a few days, but he did not contact her at all afterwards.  She thus reported the loss of her ATM card.  The one seized by PW2 was a replacement issued by the bank.

8.  The defendant's background and tax records are not commensurate with the magnitude of the deposits received by the Account.  Neither the bank nor the police have received any loss report for any ATM card associated with the Account.

Mitigation & Sentence

9. The defendant is almost 55 and has 4 conviction records, which involved 4 drug-related offences and 1 "Theft" offence. Defence solicitor Miss Wan informed me that the defendant is divorced with an adult son (aged 31). She was a waitress earning $18,500 per month. In mitigation, Miss Wan explained that though foolishly, the defendant was just helping a friend. The duration was short (17 days only)  and she received no reward. Finally, Miss Wan complained about undue delay in this case.

10. I will deal with the issue of "delay" first. Mr. Ng for the prosecution has prepared a Chronology of Events for my reference. According to the chronology, the defendant was arrested on 5 July 2021 and granted police bail. She was unconditionally released on 5 January 2022. The next milestone date on the chronology is 22 January 2024, on which the police received legal advice from the Department of Justice (DoJ)  to charge the defendant. The police claimed that they were unable to locate the defendant until 23 June 2025 when she tried to leave Hong Kong through Lok Ma Chau. The defendant was then charged and appeared before a magistrate on 24 June 2025. Every step afterwards was unremarkable.

11. In gist, Miss Wan complained that it took almost 4 years from the defendant's initial arrest to her first appearance before a magistrate. From the defendant's initial arrest to receipt of DoJ's legal advice, 3.5 years have lapsed. To supplement the chronology, Mr. Ng informed me that it took the police 1 year and 8 months to investigate this case since a total of 9 suspects were involved (they were the "1^st layer recipients" of "black money"). The DoJ took 10 months to issue legal advice. Then the police took 1.5 years to locate the defendant.

12. The defendant's initial arrest and the investigation took place during the pandemic, if not at the height of it. Be that as it may, even with 9 suspects, I do not find 2.5 years for investigation and legal advice acceptable in this case. It is, of course, easier said than done with the benefit of hindsight. A major investigation could perhaps be truncated into several sub-investigations, allowing some arrested persons to be triaged and dealt with first as and when the sub-investigations are completed.

13. Regarding the re-arrest of the defendant, Mr. Ng explained that she had changed her address. Miss Wan submitted that after her unconditional release, the defendant simply went on with her life. She did not hide or change her phone number. In my view, the defendant was a free person from 5 January 2022 onwards. She had no obligation to keep the police informed of her whereabouts (including her latest address)  and was at liberty to leave Hong Kong whenever she desired. If the police had put their minds on locating the defendant, I have no doubt that they could have found her much sooner. Putting her on the Stop List and waiting for her to show up was too passive, especially when legal advice had been given to charge her.

14. Based on the reasons stated above, I find that there is undue delay. In any event, from the initial arrest to her guilty plea before me, 4 years and 10 months had lapsed and the defendant was not at fault. She has my sympathy.

15. The prosecution has applied for an enhanced sentence pursuant to section 27(2)(c)  and (d)  of the Organized and Serious Crimes Ordinance (Cap.455)  on the basis of prevalence as well as the nature and extent of harm caused to the community. Miss Wan did not object.

16. I bear in mind the Court of Appeal's decision in HKSAR v Xu Mai Qing CACC 464/2005, whereas Yeung JA (as he then was)  held "Under section 27(11)  of OSCO, what the prosecution has to prove is the prevalence of the offence, not the increase in the number of such offences[1]."

17. I have read the witness statement of CIP Li dated 8 April 2026. I am satisfied that in 2020, deception-related money laundering cases were prevalent in Hong Kong in terms of the number of cases as well as the total value of monetary loss.

18. There is clear and cogent evidence before me that money laundering through bank accounts opened by "ML Stooges" remains widespread in Hong Kong today. The court must send a clear message to the general public that people who play the role of "ML Stooge" will receive severe punishment, so that there is a deterrent effect. When there are few or no willing "ML Stooges", criminal activities which rely on their bank accounts will fail.

19. This is a typical case of money laundering by way of a stooge bank account. Even if the defendant did not know about the deception against PW1, such a scam would have been meaningless without her bank account. Assuming what the defendant said is true, given her role, the amount which went through the Account and the overall circumstances, I grant the prosecution's application and will enhance the sentence by 25%.

20. The Court of Appeal in SJ v Wan Kwok Keung [2012] 1 HKLRD 201 held :-

Generally, the sentence for "money laundering" offences should mainly reflect the amount of "black money" laundered and not the benefit obtained by the defendant or others. The reason being that it is very difficult to prove the benefit concerned, and in most "money laundering" cases, there may not be evidence to show from what indictable offence the "black money" are in fact derived. Of course, if there is information to prove that the "black money" is originated from serious crimes, including drug trafficking, kidnap and blackmail, illegal human trafficking, other organized crimes, etc. or the defendant's benefit is huge, then the sentence should be adjusted upward.[2]

21. In determining the proper starting point, I have reminded myself of the sentencing principles laid down in HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545 and HKSAR v Boma Amaso [2012] 2 HKLRD 33. I have also borne in mind the amount of money involved, the duration of the offence, the defendant's role in relation to the movements of funds as well as her personal circumstances.

22. In SJ v Ngai Fung Sin Apple [2013] 5 HKLRD 104, Yeung V-P held :-

Neither the fact that the "illicit/black money"was actually not derived from an indictable offence nor the defendant's ignorance of the actual source of the "illicit/black money" is necessarily a valid mitigating factor…[3]

23. I accept there is no evidence showing that: (i)  except the total sum of HK$2,931,000 from PW1, the funds received by the Account were related to any predicate offence; and (ii)  the defendant was involved in or had any knowledge of any predicate offence. As the sole owner of the Account, she should have retained its ultimate control and paid attention to its transactions on a regular basis.

24. On the other hand, I cannot overlook the fact that an aggregated sum of HK$6,884,426 went through the Account within a period of 17 days. By lending her bank account to someone and thus allowing funds of unknown origins to pass through the Account, the defendant played a pivotal role in helping the mastermind(s)  of criminal activities to access their illegal funds without revealing their identities.

25. In the circumstances, I adopt a starting point of 4 years' imprisonment[4]. With the timely guilty plea, the sentence is reduced to 32 months. With the 25% enhancement, the sentence becomes 40 months. I would grant an additional discount of 4 months for the undue delay. Hence, I sentence the defendant to 36 months' imprisonment.