HKSAR v. LAM CHUNG YIU CHARLES

HCCC 98/2023

[2025] HKCFI 3294

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 98 OF 2023

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DECISION

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1.  This Decision deals with the Secretary for Justice’s application for a confiscation order against the defendant.

BACKGROUND

2.  The defendant had pleaded guilty to two counts of Theft and two counts of Dealing with property known or believed to represent proceeds of an indictable offence (commonly known as money laundering) and was sentenced on 7 November 2023 to a total sentence of 7 years’ imprisonment.

3.  Before sentence was passed, as required under s.8(3)(ii)(A) of the Organized and Serious Crimes Ordinance, Cap.455 (hereinafter as “OSCO”[2]), the Secretary for Justice applied under s.8(1) of the same Ordinance for a confiscation order to recover the proceeds relating to the offences.

FACTS

4.  In gist, and based on the Summary of Facts that the defendant had admitted to, while the defendant was an associate director of UBS Bank, he stole USD$837,790.98 (count 1), and USD$1,037,239.66 (count 2) that belonged to two different branches of the Bank, respectively between 13 March and 27 October 2020, and between 1 June and 27 October 2020.

5.  He also laundered HK$159,500 and US$314,067.26 between 28 May and 31 October 2020, (count 3), as well as HK$5,130,206.87, US$7,000, and GBP£301,630.04 between 13 March and 8 December 2020 (count 4).

6.  In the period between December 2019 and 31 October 2020, while employed as an associate director of UBS, and assigned to be the head of a project to compensate clients who had been overcharged by the bank in previous transactions (“the project”), the defendant exploited his access to UBS’s system in Hong Kong for access to client details and payments, and altered information of rightful recipients under the project, directing payments to be made to his own accounts.

7.  The thefts were by way of 46 payments that the defendant had arranged to be paid to third parties with no apparent association with UBS.

8.  5 of those 46 payments were made to two bank accounts held by a “YOW Wayne” (“YOW”) and a “KOH Pang-an” (“KOH”). Investigations revealed that the defendant had officially changed his name to YOW and KOH, respectively, in February and March 2020, and then opened bank accounts under those names in order to steal the money surreptitiously. He changed his name back in October 2020.

9.  Investigations also revealed that 41 of the said 46 payments were made to 8 different vendors of luxurious watches, with 2 of those also dealing in handbags. One of them was a Sun Moon International Limited, who was found to also have purchased 32 luxurious watches from the defendant for a total of HK$8,738,700, which were all settled in cash.

THE DISPUTED ISSUES

10.  It is the applicant’s case that the defendant must not be allowed to benefit from his criminal acts, hence their application for a confiscation order.

11.  The Court of Final Appeal provided a succinct summary of the aim of the confiscation order in HKSAR v Li Kwok Cheung George (2014) 17 HKCFAR 319; FACC 4/2013:

“40. The provisions governing confiscation orders are aimed at depriving a defendant of his proceeds of the relevant offence to the extent that he has benefited from such offence. Such an order can be made against a defendant who has been convicted of and is to be sentenced for a specified offence. But before the power can be exercised, section 8(4) requires the court first to determine that he ‘has benefited from the specified offence’ and that ‘his proceeds of that specified offence or offences are in total at least $100,000.’ Benefit is therefore fundamental to the confiscation jurisdiction. If satisfied as to such benefit, the court proceeds to determine the amount to be recovered from that defendant. Section 11(1) prescribes as the recoverable amount ‘the amount [the court] ... assesses to be the value of the defendant’s proceeds of the specified offence to which section 8(4) applies.’ The court may order the defendant to pay that assessed amount or, if it is satisfied that the amount which can be realised is less than the assessed value of the defendant’s proceeds, a lesser sum. The power is therefore aimed at stripping the defendant of his proceeds of the offence to the extent to which he has benefited from it, within his realisable means.”

12.  It is not disputed by the parties that it has been settled in the case of HKSAR v Lung Wai-hung [1999] 1 HKLRD 598 that the imposition of a confiscation order is mandatory once the court is satisfied that all requirements under the relevant provisions of OSCO have been met:

“We have concluded that the clear intention of the legislation is that where the Secretary for Justice has taken all proper steps to apply for an order for confiscation, and all other requirements of the legislation have been met, the making of an order in what the court determines to be an appropriate sum is mandatory…”[3]

13.  In the present case, of all the determinations that this court is required to make by law, there is, in effect, only one that is in dispute, which is the Amount that Might Be Realised at the time the confiscation order is made (“the AMBR”). In other words, the ‘realisable means’ of the defendant as expressed by the Court of Final Appeal in their judgment passage above.

14.  According to s.11(3), if this court determines that the AMBR is less than the Value of the defendant’s Proceeds (“the VoP”), then the Amount To Be Recovered under the confiscation order (“the ATBR”) shall either be the lesser AMBR, or a nominal amount if it is determined that the AMBR is “nil”.

15.  If the AMBR is equal to or larger than the VoP, then the ATBR shall be the VoP, which is accepted by the applicant as to be the combined amount of money stolen in the 2 counts of theft of US$1,875,030.64. The defendant does not dispute this VoP figure.

16.  It is the defendant’s case that his AMBR is either at “nil”, or far below what the applicant has suggested through the 3 witness statements of DSIP Man, made under s.10 in support of their application (“the s.10 statements”), which is less than the VoP, and as such, if the confiscation order was made, the ATBR can either only be a nominal amount, or his lesser AMBR figure, and not the VoP figure, nor the applicant’s suggested AMBR figure.

17.  I will deal with the defendant’s ‘nil AMBR’ argument first.

THE ‘NIL AMBR’ ARGUMENT

18.  The basis of the defendant’s ‘nil AMBR argument’ is the civil judgment obtained by UBS AG against the defendant in High Court Action HCA 413/2021. For the purpose of the present application, UBS AG is regarded as the victim of the defendant’s thefts.

19.  3 sums have been ordered by the court to be paid by the defendant to UBS. The first order was made by way of a consent summons, in the amount of USD$1,875,030.64, being the exact same amount of the VoP, that is to say the total money stolen in the 2 thefts.

20.  In the same Action, the defendant was also ordered to pay a further sum of USD$6,245,936.52 as damages to UBS for the defendant’s breach of his employment contract, together with costs of HK$630,000.

21.  The defendant argues that the civil judgment debt in that Action is an “obligation having priority” under s.12(3)(b), and as such should be deducted from the value of his “realisable property”, which is defined in s.12(1) as:

“(1) In this Ordinance, realisable property (可變現財產) means, subject to subsection (2) –

(a) any property held by the defendant;

(b) any property held by a person to whom the defendant has directly or indirectly made a gift caught by this Ordinance; and

(c) any property that is subject to the effective control of the defendant…”

22.  Section 12(3) reads as follows:

“(3) For the purposes of this Ordinance the amount that might be realised at the time a confiscation order is made against the defendant is—

(a) the total of the values at that time of all the realisable property held by the defendant, less

(b) where there are obligations having priority at that time, the total amounts payable in pursuance of such obligations, together with the total of the values at that time of all gifts caught by this Ordinance.”

23.  The defendant argues that, since the judgement debt in the Action is more than the VoP, even if assuming the applicant’s valuation of the defendant’s realisable property is correct, deducting the debt as an ‘obligation having priority’ from the value of the realisable property would result in a negative AMBR figure, and as such s.11(3)(b) requires that the amount to be recovered under the confiscation order to be ‘a nominal amount’.

24.  An ‘obligation having priority’ is defined under s.12(7):

“For the purposes of subsection (3), an obligation has priority at any time if it is an obligation of the defendant to –

(a) pay an amount due in respect of a fine, or other order of a court, imposed or made on conviction of an offence, where the fine was imposed or order made before the confiscation order; or

(b) pay any sum which, if the defendant had been adjudged bankrupt or was being wound up, would be among the preferential debts.”

25.  The defendant’s civil judgment debt is not a fine or an order imposed on conviction of an offence, and s.12(7)(a) does not apply to render it an obligation having priority.

26.  “Preferential debts” is defined in s.12(8)(a) as the debts to be paid in priority under s.38 of the Bankruptcy Ordinance, Cap.6. It is not the defendant’s case that the civil judgment debt in HCA 413/2021 is caught under s.12(7)(b), and it is clear that it also does not apply to render the judgment debt an obligation having priority.

27.  It is the defendant’s argument that the definition of an “obligation having priority” in s.12(7) is not exhaustive, and that, therefore the civil judgment debt can be, and is, an obligation having priority at the time of the making of the confiscation order.

28.  In the case of HKSAR v Lung Wai-hung referred to above, the Court of Appeal made the following observations regarding s.12(7) :

“Section 12(7) narrowly defines ‘obligations having priority’ to refer to orders made by the convicting court or amounts which would be considered preferential debts under the Bankruptcy Ordinance, Cap.6, or the Companies Ordinance, Cap.32. More precisely, section 12(7) provides:

‘…(the Court sets out s.12(7))…’

The definition of ‘preferential debts’ is to be found in section 12(8).

It follows, therefore, that except in the limited circumstances defined in section 12, a defendant’s obligation to satisfy the confiscation order takes priority over any other claims to the property.”

29.  The wordings of s.12(3) is clear, the realisable amount can only be reduced as provided for in s.12(3)(b). Unless there are ‘obligations having priority’ at the time of the making of the confiscation order, the realisable amount is the total of the values of all the realisable property held by the defendant.

30.  The words ‘at that time’ in s.12(3)(a) and (b) and the part concerning gifts caught only mean ‘at the time of the making of the Confiscation Order’ and not otherwise.

31.  As for the words ‘at any time’ in s.12(7), logic dictates that it cannot include a time after the making of the confiscation order, since the law requires the determination of the amount to be recovered be completed before the making of the confiscation order. I find that a proper reading of the term leads to the conclusion that the phrase is there merely to show that the section’s coverage includes obligations that arose at any time before the making of the Confiscation Order.

32.  As observed by the Court of Appeal in Lung Wai-hung, s.12(7) provides a narrow definition of what can amount to an obligation having priority. The definition under s.12(7) and (8) is clear and unambiguous. It is a limited, exhaustive and complete definition, and there is no legal basis that would allow this court to give it a wider definition than as legislated.

33.  That being the case, the defendant’s liability under the civil judgment debt is not an ‘obligation having priority’ and as such is not liable to be deducted from his realisable property under s.12(7)(b), and the defendant’s ‘nil AMBR argument’ fails.

THE ‘DOUBLE RECOVERY’ ARGUMENT

34.  In addition to the ‘nil AMBR argument’, it is also the defendant’s case that if the Confiscation Order is made and the Amount to be Recovered is the VoP, the defendant would be in a position where he is legally required to pay the same sum of money twice in order to comply with both the confiscation order and part of the civil judgment order. The defendant refers to this as ‘double recovery’, and argues that it would lead to injustice and as such this court should make no confiscation order at all, even assuming it is satisfied that all the legal requirements under OSCO have been met.

35.  As mentioned above, it is well settled law that this court does not possess the power to not impose a confiscation order if it is satisfied that all the prescribed conditions have been met upon the Secretary of Justice’s application for such an order. I refer to the earlier quote from the case of Lung Wai-hung and will not repeat it here.

36.  The defendant appears to rely on the fact that the Court of Appeal had allowed the appeal in Lung Wai-hung and set aside the confiscation order imposed by the trial judge despite finding that there was no error in the judge’s application of the relevant provisions in OSCO, to suggest that this court, by extrapolation, has a power to not make the order if to do so would result in injustice.

37.  The difficulty that the Court of Appeal had in Lung Wai-hung was that there appeared to be a large number of potential victims of the underlying thefts yet to come forward to seek civil compensation for their losses, and that if the confiscation order made by the trial judge was allowed to stand, it would mean that any assets which might have been available to settle any such civil claims would no longer be available to the innocent victims of the defendant’s crime.

38.  There the Court’s attention was drawn to section 71(1C) of the Criminal Justice Act 1988 in England, where it is stated that if:

“….. the court is satisfied that a victim of any relevant criminal conduct has instituted, or intends to institute, civil proceedings against the defendant in respect of loss, injury or damage sustained in connection with that conduct –

(a) the court shall have a power, instead of a duty, to make an order under this section.” (as emphasized by the Court of Appeal)

39.  The Court found it ‘unfortunate’ that the courts in Hong Kong do not possess an equivalent discretion to decide whether or not to make the order.

40.  Despite their view that it is no way to treat innocent victims of crime from seeking their remedy by rendering a defendant penniless through the making of a confiscation order, and the fact that if confiscation orders are made behind the backs of some victims in the face of others would not allow for a healthy public perception of the system, the Court nevertheless confirmed that they did not have the power to substitute a nominal sum with a nominal period of imprisonment over the order made by the trial judge.

41.  The Court did, however, nevertheless give leave to appeal against the making of the confiscation order by the trial judge, and proceeded to quash the confiscation order, “without making any criticism of any kind”, and allowed the appeal to that extent.

42.  The Court suggested that the Secretary for Justice may wish to bring to the attention of the Legislators the lack of a discretion provision equivalent to the English s.71(1C) referred to above, opining that the absence of such a discretion could lead to injustice in cases such as that one.

43.  It has been almost 27 years since the handing down of their Reasons and there has been no such amendment to the law. It is clear that the defendant’s argument that this court possesses a power to not impose a confiscation order on the basis of resulting injustice cannot be sustained.

44.  Putting aside the mandatory nature of the relevant legal provisions, I would, in any event, have found that no injustice would result from the making of a confiscation order in the present case.

45.  There is only one victim entity in the present case. Despite the relatively large sum of money involved, it is likely that the Bank would be able to absorb the losses, as evidenced by the fact that it is still in operation.

46.  Despite the civil judgment being entered in November and December 2024, as of the hearing of this application, the defendant has not made any payment towards the satisfaction of the said judgment sums.

47.  Unlike in Lung Wai-hung where it was likely that there were still lots of potential victims who were not aware of the proceedings, the victim company in the present case has all along been made fully aware of the Secretary for Justice’s application for a confiscation order. I have been told by the applicant that a legal representative from UBS was present at both confiscation order hearings.

48.  With total transparency, the Secretary for Justice has informed UBS of the possible legal consequence of them being barred from enforcing the corresponding part of their judgment of USD$1,875,030.64 in HCA 413/2021 if the Confiscation Order is made.

49.  With that knowledge, UBS has expressly confirmed that they have no objection to the Secretary for Justice’s confiscation order application[4].

50.  Therefore, I find that, even if this court had the power, which it does not, to not make a confiscation order on the ground that its making would result in injustice, I would have exercised that power against the defendant since there will be no similar situation of injustice against the victim company that existed in Lung Wai-hung.

51.  The defendant’s ‘double recovery’ argument fails.

THE AMBR

52.  I move on to determine the Amount that Might Be Realised.

53.  It is not disputed by the defendant that it is for him to prove on the balance of probabilities “the amount that might be realised at the time of the confiscation order is made is less than the amount the court assesses to be the value of the defendant’s proceeds…” under s.11(3).

54.  In this regard, the defendant has tendered 3 statements under s.10(4)(a), setting out the matters he finds relevant to determining the amount that might be realised at the time of the confiscation order is made.

55.  As for the applicant, they rely on the evidence set out in the three s.10 statements of DSIP Man mentioned earlier to challenge the defendant’s assertions. These statements were tendered by the applicant under s.10(1), and are legally relevant for determining whether the defendant has benefited from the thefts, as well as for assessing the Value of the defendant’s Proceeds of the offences (VoP).

56.  As referred to above, the AMBR is the total of the values at the time of the making of the Confiscation Order of all the realisable property held by the defendant.

57.  I have already determined that the defendant has failed to make out that the judgment debt in HCA 413/2021 can be deducted as an ‘obligation having priority’. As such, the AMBR equals the total of the values of all the realisable property held by the defendant under s.12(3)(a).

58.  Section 2 of OSCO states that ‘property’ includes movable and immovable property within the meaning of section 3 of the Interpretation and General Clauses Ordinance, Cap.1, which reads,

“3. Interpretation of words and expressions

… property (財產) includes—

(a) money, goods, choses in action and land; and

(b) obligations, easements and every description of estate, interest and profit, present or future, vested or contingent, arising out of or incident to property as defined in paragraph (a) of this definition;”

59.  Despite the fact that the burden is on the defendant and not the applicant to prove the defendant’s AMBR, in order to assist this court in assessing the AMBR, DSIP Man has in paragraphs 16 to 27 of his first s.10 statement set out 4 items of realisable properties that the police have been able to identify during the course of investigation as belonging to the defendant.

60.  It is DSIP Man’s evidence that the total value of the defendant’s realisable property that is known to the police is the combined value of the 4 items, as set out below.

•  Item 1 is the defendant’s savings of around HK$127,177.71 (subject to exchange rate) in his HSBC bank account 813-869104-833.

•  Item 2 is cash of about HK$167,571.23 (subject to exchange rate) seized from the defendant upon his arrest.

•  Item 3 is 40 watches of ‘Rolex’ brand. The police have not been able to seize the actual watches. It is the applicant’s case that, based on the 40 hangtags found in the defendant’s possession at the time of his arrest at the airport, and their watch expert’s opinion, the only reasonable inference must be that the defendant held those watches. Based on the model number on the hangtags, the expert valued 39 of the watches with a total value of HK$10,394,000.

•  Item 4 is a total of around HK$3,256,712.85’s worth of Pound Sterling that the defendant had transferred to a law firm in the United Kingdom by way of two SWIFT transfers on 13 and 23 November 2020 (GBP£101,940 and 225,164 respectively). The moneys were transferred from the defendant’s HSBC account 813-869104-833 to a UK-based solicitor firm which provided legal services in property. In the corresponding transfer documents exhibited in DSIP Man’s 1^st s.10 statement, the 1^st transfer is stated under the Sender to Receiver box as “/ACC/PERSONAL INVESTMENT”[5], whereas the 2^nd transfer is stated as “/ACC/PURCHASE OF PROPERTY”[6].

ITEMS 1 AND 2

61.  In relation to Item 1 and Item 2, the defendant stated the following in his 1^st witness statement:

“14. The first item (i.e. my savings of around HKD127,177.71 in my HSBC account of number 813-869104-833) of realisable properties was identified at paragraph 17. There is no dispute or objection in this regard.

15. The second item (i.e. the HKD167,571.23 cash seized upon arrest) of realisable properties was identified at paragraph 18. There is also no dispute or objection in this regard.”

62.  The defendant maintained the said position towards items 1 and 2 all the way through to his 3^rd witness statement.

ITEM 3: THE WATCHES

63.  In short, despite it is not for the applicant to prove, they say that based on evidence referred to below, the defendant is the owner of at least 40 Rolex watches, or that they are properties under his effective control, and their value should be counted towards the defendant’s realisable property. The defendant disputes this, claiming that he only owned 21 of those 40, that 6 belonged to his wife, and the rest had all been sold.

64.  It is a fact that, when the defendant was arrested at the airport on 3 December 2020, he had with him 60 “Rolex” green seals and 40 “Rolex” hangtags. No “Rolex” watches were actually found. The hangtags is the evidential basis of the applicant’s assertion that the defendant owned the corresponding watches.

65.  Mr. John NG, a watchmaker and trader with 30 years’ experience in the industry was engaged by the applicant to give his expert opinion on how “Rolex” watches are traded in the first and second hand markets; and what the estimated value of the “Rolex” watches represented by the hangtags[7] might be.

66.  It is, first of all, Mr. Ng’s opinion that all the green seals and hangtags in the possession of the defendant are authentic. He explains that a new Rolex watch is sold with the following accompanying accessories:

(a)  a presentation box;

(b)  a user manual;

(c)  a guarantee card in a card holder;

(d)  a green seal (an official certification of the authenticity of the watch); and

(e)  a hangtag (which bears a barcode, the model number, and serial number of the watch).

67.  He notes that some authorized dealers in Europe may withhold hangtags in order to dissuade watch flippers.

68.  A full set with all the said accessories would fetch the highest market value when trading the watch in the second-hand market. This is true globally and more so in Europe. Missing accessories would negatively impact the liquidity of the watch and its selling price.

69.  It is common to import luxury watches into the UK separately from their hangtags, since the watch without the hangtag would then be regarded as pre-owned and not liable to be taxed during customs clearance.

THE HANGTAG

70.  A “Rolex” hangtag bears a barcode, the serial number and the model number of the corresponding watch. The serial number is unique to each watch, and is a series of alphabets and numbers. The same serial number is engraved on the watch case.

71.  Based on the hangtags found on the defendant, Mr. Ng was able to identify 39 of the 40 watch models. He then proceeded to explain the factors taken into consideration when deciding on their market values.

72.  The most important factor is the particular model’s scarcity. Other factors include the official price, condition, the presence of special features (such as special dials), and price of precious materials used in the manufacturing of the watch. Since he did not have the actual physical watch, he proceeded with his valuation under the assumption that they are all of mint conditions.

73.  In his valuation, he relied on his knowledge and experience in trading “Rolex” watches. It is his evidence that “Rolex” watches generally keep their official price very well, and they very often would appreciate.

TOTAL VALUE OF THE WATCHES

74.  As at 18 March 2024, he valued all 39 hangtag watches at a total of HK$10,394,000. Although there were 40 hangtags, the model number on one of them was illegible and he was not able to make the assessment.

THE RETURN OF THE DEFENDANT’S FEDEX PARCEL SHIPMENTS

75.  According to paragraph 23 of DSIP Man’s 1^st s.10 statement, after the defendant’s arrest and while he was in remand, 4 watches which the defendant had himself couriered to the UK prior to his arrest, and which had the defendant himself as the addressee, were returned to the virtual office that the defendant had rented in Central.

76.  DSIP Man asserts that it could be inferred that the defendant owned at least 40 “Rolex” watches based on the hangtags; that the defendant had previously couriered those watches to the UK; and that he was going to bring the corresponding green seals and hangtags with him to the UK, which would have allowed him to avoid paying tax, but at the same time to be able to eventually sell the watches at the best possible price with a full set of accessories.

THE DEFENDANT’S ARGUMENT REGARDING THE WATCHES

77.  The defendant disagrees with DSIP Man’s and Mr. Ng’s views and assertions.

78.  At paragraph 16 of his 1^st witness statement, the defendant stated that he did not own the 40 Rolex watches which hangtags he had with him at the time of the arrest. He claims to have been interested in trading in luxurious watches since young and had been actively trading even before committing the present offences. He did sometimes earn money, but most of the profits so earned were either spent on buying higher watch models, or lost in gambling. He referred to his Hong Kong Jockey Club account records in the unused materials.

79.  He claimed to believe that he had lost around HK$1,000,000 in gambling, suggesting that this also explains why his realisable property is less than the value of his crime proceeds.

80.  The defendant listed out, in a table in his statement, 18 of the 40 watches which hangtags were found on him that he claim to “not presently belong to me and are not gifts from me to others”.

81.  According to the “Aid memoire of the defendant” (dated 15^th July 2025) helpfully prepared by Mr. Wong, of the 39 watches, 21 belonged to him, 6 to his wife, and the remaining ones he no longer possessed since they had been sold and the money used to purchase a total of 3 Patek Phillipe or other watches.

82.  Of the 21 watches that the defendant had admitted to belonging to him, he had made clear to the court that he is willing to hand them over to the applicant.

83.  The defendant stated in his 1^st witness statement that since he did not have access to his “watch collections”, he could not give a full account of the ownership of the watches. He also stated that he had two other Rolex watches which have not been listed in DSIP Man’s 1^st s.10 statement, since the defendant did not have the hangtags of the two watches with him at the airport. He stated that those two watches were “collectibles” and worth around HK$180,000 in total.

84.  The defendant explained that the reason why he had the hangtags despite having sold some of the watches was because some buyers, giving Sun Moon as an example, did not require the hangtags. He then pointed out that, according to the purchase receipt of Sun Moon, one of the watches the applicant allege was part of his realisable property was actually recorded as sold to Sun Moon on 27 October 2021 for HK$397,500. The seller’s name in the receipt is stated as “KOH Pang An”, and the serial number of the watch being traded was “08JH3729”, which is hangtag 23 in Mr. John Ng’s Expert Report. The applicant, through the evidence of DSIP Man, accepted that such is the case and that the defendant no longer owned this watch.

85.  The defendant carried on to claim that he would not destroy or throw the hangtags away. He claims that “some of the tags I possess may carry no value at all because the corresponding watches have been sold already.”

86.  The defendant confirmed that he was told that 1 Rolex and 3 Patek Philippe watches had been returned to Hong Kong to him but then taken away by the police. It is his case that these watches should be included as his realisable property.

87.  As to the valuation of the 39 watches by Mr. Ng, the defendant claimed that he was “shocked” at his HK$10.394 million valuation. He claims that Mr. Ng did not take into account that they were second hand watches and many had depreciated in value to a large extent. He is “very certain” that the watches were only worth around HK$7 million.

88.  The defendant claimed that he had “already instructed my solicitors to look for an expert to make a valuation report over the watches and I am given to understand that it is still in progress. Nevertheless, the preliminary advice provided to me is that the market price estimated by Mr. Ng is overwhelmingly high.” It is not clear from the defendant’s witness statement who gave him this “preliminary advice”.

89.  As for the defendant’s own expert valuation report, there has never been one tendered by the defendant in the present application hearings.

90.  It is the defendant’s case that since 18 of the underlying watches of the hangtags do not belong to him, they should not be regarded as his realisable property; that of the 21 watches that he had admitted to owning (excluding the returned Rolex and 3 Patek Philipe), his estimated value of them is around HK$4.2 million, and HK$5.2 million if Mr. Ng’s estimation is adopted.

91.  DSIP Man replied as follows to the defendant’s assertions in his 2^nd s.10 statement:

(a)  The defendant has realisable property other than Items 1 - 4;

(b)  The defendant’s assertion that he repaid debts is not believable;

(c)  The defendant’s gambling losses have limited impact on the amount that might be realised from him;

(d)  There is sufficient evidence to show the defendant owned the “Rolex” watches (Item 3), because:-

i.  the defendant couriered at least 42 watches to the UK shortly before his attempt to leave Hong Kong;

ii.  The watch collecting habit asserted in the defendant’s statement is not believable;

iii.  The assertion that six “Rolex” watches belong to the defendant’s wife is not believable; and

(e)  The defendant fails to prove that money he transferred to Matini Montecristo LLP (Item 4) are no longer his realisable property.

REALISABLE PROPERTY BEYOND ITEMS 1 TO 4

92.  It is the applicant’s position that the burden is on the defendant to show that the amount that might be realised is less than USD$1,875,030.64. The fact that DSIP Man had identified Items 1 to 4 does not mean that the defendant has no realisable property other than that covered by the 4 items.

93.  DSIP Man proceeded to explain why the background of the defendant and the circumstances of this case would lead to the inference that the AMBR from the defendant is not less than the VoP of US$1,875,030.64.

94.  First, the defendant stole the money from UBS AG between March and 27 October 2020, and used bank accounts to launder around HK$10,770,311.47 of the stolen proceeds between March and 8 December 2020, mostly by transferring funds out of Hong Kong. He was arrested on 3 December 2020, which was shortly after the period of the thefts and before he could leave Hong Kong for the UK. He has since been remanded. The defendant simply had had no chance to spend the proceeds of the thefts and / or the money laundering.

95.  Secondly, the defendant received a monthly salary and the theft proceeds were not his only property. He was also provided with accommodation by his employer.

REPAYMENT OF DEBTS

96.  As to the defendant’s repayment of debts, it is DSIP Man’s evidence that the defendant’s assertion that the money from the sale of some of the watches he owned was used to settle his debts is not believable.

97.  According to the TransUnion Credit Report of the defendant dated 11 March 2021, the defendant had a credit score of ‘H’, with ‘A’ being the best and ‘J’ the worst. The defendant had since March 2006 taken out at least 12 loans and held 4 credit cards. He remained in debts throughout the periods of his commission of the 4 offences. As at the date of the said report, which 3 months after the defendant’s attempt to leave Hong Kong, he still owed a total of HK$1,882,511. It is obvious that the defendant had intended to, and did, evade his debts.

GAMBLING LOSSES

98.  As to the defendant’s gambling losses, DSIP Man did go to the defendant’s Jockey Club account statements and confirmed that the defendant had lost about HK$1.42 million in the period between 1 March and 3 December 2020. Be that as it may, DSIP Man pointed out that the defendant had stolen 10 times this amount, and the losses had limited impact on the AMBR.

21 FEDEX SHIPMENTS OF “WATCHES” TO THE UK

99.  As to the number of watches that the defendant owns, it is DSIP Man’s evidence that according to FedEx records, between 18 November 2020 (when the defendant first became their customer) and 3 December 2020 (a period of 16 days and right up to the day of his arrest), the defendant had made 25 FedEx shipments to the UK. 21 of those shipments were declared to contain “watches” (plural).

100.  CCTV footages captured the defendant packing watch boxes into A4-sized packing boxes and dispatched them.

101.  According to the list of the details of the shipments exhibited to the witness statement of the Senior Security Specialist of FedEx, all but one of the 25 shipments had the same Recipient Address of “Flat A3904, Manchester, LA, GB”. The only one with a different recipient address is a parcel described as “Document” which were sent on 19 November 2020 to “17 Hanover Square, London, GB”, which is the address of the solicitor firm of Matini Montecristo (the law firm in Item 4). This was 4 days before the defendant made the 2^nd transfer in the amount of GBP225,164 to the law firm.

102.  According to one of the items with tracking number “8144 2513 8981” the recipient’s address on the International Air Waybill had been filled in as “Flat A3904, 9 Owen Street, Manchester, UK, M15 4TT, and the contents of the parcel is stated as ‘watches’ with a value of HK$150,000.

THE RETURNED WATCHES IN MINT CONDITION

103.  Meanwhile, since 29 May 2020, the defendant had rented the use of a virtual office in Central. On 7 January 2021, two FedEx parcels which were addressed to the defendant himself with a UK address were returned to his virtual office, because delivery in the UK had failed. Upon opening, each parcel contained two watches in mint condition, and they are the 1 Rolex and 3 Patek Philippe mentioned above. The packaging of the returned parcels were consistent with those captured on FedEx’s CCTV footages.

104.  The 4 returned watches were shown to the court. The applicant pointed out that the transparent plastic wrappings are still attached to the watches. They say that based on the condition of the returned watches, it can be inferred that each of the 21 shipments of “watches” contained at least two luxury watches also in mint condition, and that the defendant had therefore shipped out at least 42 watches right before he attempted to leave Hong Kong for good, thus suggesting that the defendant’s assertion that he did not own all the watches represented by the 40 hangtags (save for the one that had been accepted as having been sold to Sun Moon) cannot stand. The condition of the returned watches also support the valuation by their expert Mr. John Ng.

WATCH FLIPPING

105.  As to the defendant’s watch collecting habit, DSIP Man referred to the trading record of Sun Moon, being one of the watch companies that the defendant had traded with, which showed that the defendant had bought 4 and sold 32 with them for HK$970,600 and HK$8,738,700 respectively, between 3 September and 27 November 2020. Bearing in mind that Sun Moon was but one of the 7 watch dealers traded with the defendant, they say that the defendant was not a collector but a ‘flipper’ of watches.

106.  It is the applicant’s case that given the defendant’s theft and money laundering were committed in close proximity to the trading, the irresistible inference is that the defendant had flipped watches as one of the ways he laundered his crime proceeds.

WATCHES BELONGING TO WIFE

107.  As for the 6 watches that the defendant had asserted to have been bought by his wife and belonged to her, DSIP Man pointed out that based on his wife’s income from her job as a kindergarten teacher between April 2017 and July 2020, her declaration to the Inland Revenue of her holdings in a property which was let out at HK$15,500 per month from 1 October 2019 to 31 March 2020, and the fact that the defendant’s wife was unemployed at the time of the defendant’s arrest, and the fact that based on the total market price of the 6 watches, his wife would have to save up enough money for 20 to 32 months in order to make the purchase, they say the defendant is not telling the truth about the true ownership of those 6 watches.

THE DEFENDANT’S REPLY TO DSIP MAN

108.  In the defendant’s 2^nd witness statement, he replied to the evidence of DSIP Man in relation to the watches. He repeated that he does not own all the Rolex watches represented by the hangtags.

THE 25 FEDEX SHIPMENTS

109.  In relation to the 25 FedEx shipments, he claimed that “some of the shipments to the UK contain watches belonging to my wife, as I was responsible for the deliveries.” They were “moving to the UK together”, and he had some of his wife’s belongings in his luggage, including the internet banking security device of her HSBC account.

WIFE BUYING THE WATCHES

110.  The defendant further claimed that “my wife did purchase her own watches and I do not see any reason why it is unbelievable for her to have saved up money to make such purchases.”

111.  It is confirmed by Mr. Benny Wong that the wife of the defendant has not filed any witness statements in the present proceedings. There is, therefore, no direct evidence as to which watches she had bought and with whose money.

UNABLE TO SELL WATCH IN THE MARKET

112.  The defendant then raised the matter about how the watches that he had admitted to owning cannot be sold in the market “as they are targeted by the Police; and I am under a Restraint Order” and could not deal with his assets.

THE 4 RETURNED WATCHES

113.  As for the 1 returned Rolex and 3 Patek Philipe watches, the defendant claimed that he is “willing to have them sold to repay UBS AG or satisfy the confiscation order”, believing that the Department of Justice should assist him in this regard since they are part of his realisable properties.

“UNABLE TO CONTACT MY WIFE”

114.  In the defendant’s 3^rd witness statement, he claimed that “I have been unable to be notified of the current status of the watches I was in possession of since I have not been able to contact my wife from February 2025 onwards.”

115.  The defendant did not provide details as to how he had tried to contact his wife, for example was it by letter or email or phone call or text messages, nor did he say if he engaged the help of friends and relatives to contact her. His witness statements also do not state whether the defendant knew where his wife was living in the UK, and if he did know, the details of the accommodation.

OWNERSHIP OF WATCHES

116.  The defendant reiterated that he did not own at least 38 Rolex watches, because some were sold to repay debts, some to finance purchase of new ones; and some watches belonged “to other people, e.g. my wife.” This is the first time the defendant had mentioned that any of the watches represented by the hangtags he had belonged “to other people” not including his wife. It would appear that by other people he could have meant that they had been sold and so belonged to the purchasers.

“HURDLES IN SELLING THE WATCHES”

117.  After confirming that the Restraint Order was varied to allow him to deal with his properties, he claimed that he had been facing “multiple hurdles in selling the watches”. He claimed that before the Restraint Order was varied, he “instructed my relatives and friends to explore the opportunity of selling my watches once the Order was to be varied…,” nevertheless, after attempting to deal with “various parties, including official and authorized watch dealers, pawn shops, second-hand buyers and online shops, I was informed that my watches are banned from trade in the global market.”

118.  He claimed that on several occasions he had instructed one of his relatives who wishes to remain anonymous, “to assist selling the watches in the UK in physical shops and he was warned by shops that they would have to call the police since the watches were tagged and could not be traded.”

“RED ALERT” ON WATCHES

119.  That relative also helped to check the status of his watches online to see if they could be traded, and he was “then informed there was a ‘red alert’ on the watches”. The defendant is unsure whether the red alerts were posted by the Hong Kong Police Force or Rolex. It is the defendant’s evidence that the red alert in effect would alert a purchaser that the watch was involved in criminal activities and that “they were not to be traded”. The defendant claims that the red alert “gravely diminishes” the value of his watches to the extent that purchasers would not be willing to make an offer, or they being only willing to pay one-tenth of the market price.

120.  As a result of that information, the defendant had instructed his legal representatives to tell the applicant that he wanted to hand over the watches for them to sell. The defendant was then told that the Hong Kong Police did not impose any ban on the trading of the watches in question, but confirmed that the watches were indexed by Rolex.

121.  It is the defendant’s case that because of the indexing, it had become almost impossible to sell the watches at a reasonable or even acceptable price. He remains willing to surrender the 21 watches that he claims to own to the applicant for them to be sold and the proceeds to be applied towards the satisfaction of any confiscation order that might be imposed.

122.  The defendant did not produce any expert valuation report on the watches, and he is of the view that the applicant should provide the court with an updated valuation to reflect the current market situation.

UNABLE TO TRACE SOME OF THE FEDEX SHIPMENTS

123.  The defendant also claimed that not all of the 25 FedEx packages he had posted had arrived at the UK address. The defendant did not specify which had arrived and which had not, and whether it was just the Manchester address or the one with a London address as well. He merely asserted that he had been unable to trace the missing parcels.

124.  It is noted that the defendant had never tried to rebut the evidence of DSIP Man about each of the parcels which contents was stated as ‘watches’ contained at least 2 luxury watches. Even in this his last witness statement, he never attempted to clarify what he sent in those parcels.

125.  Lastly in relation to watches, the defendant reiterated that he maintains the position that the 4 returned watches are to be counted as his realisable property, and that he had no objection to have them sold to repay UBS AG or to satisfy the confiscation order that the applicant sought to be made, and that the Department of Justice should assist him in this regard.

UPDATED VALUATION OF THE WATCHES

126.  In DSIP Man’s 3^rd and last s.10 statement, he exhibited the further expert opinion of Mr. John NG who provided an updated valuation of the 39 watches represented by the hangtags, as well as the value of the 4 returned watches. The former valuation is at HK$9,249,000 and the latter is at HK$4,190,000.

127.  The 4 returned watches are now in the custody of the police, and the defendant had unequivocally stated that he is willing to hand them over for sale to settle either his civil judgment debt or the confiscation order, if made.

128.  It is DSIP Man’s evidence that subsequent to the defendant’s legal representatives informing the Secretary for Justice by way of letter of the defendant’s difficulties selling his watches, the police had made enquiries with Rolex Hong Kong, who confirmed that they did index the 39 watches’ hangtags. However, the indexing is local and not global, and the indexing does not in any way hinder the free trading in the watches.

129.  The above is the evidence before this court on item 3. I move on to the evidence relating to item 4.

ITEM 4: THE MONEY TRANSFERRED TO THE UK LAW FIRM

130.  Item 4, as mentioned above, was disclosed by the applicant through the evidence of DSIP Man in his 1^st s.10 statement.

131.  Of the two transfers to the UK law firm, the defendant claimed the following in his 1^st witness statement:

“Whilst this transaction is the payment for my wife’s application for immigration to the UK, it is split into two parts. The first part is the payment to the legal firm which is around GBP £101,940, including visa application fee, legal fee charged by the UK law firm, registration fee for business investment and all expenses for the set-up of a company for my wife. The sum cannot be retrieved in any event and should not be regarded as my realisable property as it no longer belonged to me.”

“The second part of the payment constitutes investment to be made on approved items to establish the immigration status and the sum is around GBP £220,000.”

132.  He further claimed that he had asked his relatives to contact the law firm to cancel the investment scheme and to retrieve the money. He was, however, told that the firm was forced to close down and intervened by the Solicitors Regulations Authority (“the SRA”) in the UK due to their failure to comply with section 9 of the Administration of Justice Act 1985. Neither the defendant nor his legal representatives expanded on that failure in compliance.

133.  The defendant claimed to have instructed his then legal representatives to contact the SRA ‘but to no avail’, and no information has been provided regarding whether the investment sum could be traced. It is not clear if it was the SRA or his then legal representatives who had not provided such information.

134.  It is the defendant’s case that, in any event, the payments “should also not be regarded as my realisable property as I do not have control over the money, and it is highly likely that I will not be able to retrieve it from the SRA.”

135.  In response to the defendant’s above assertions, DSIP Man replied in his 2^nd s.10 statement that the fact that a law firm is closed does not mean that the defendant no longer holds an interest in the money, or that he will not be able to recover the money, which the law firm must have initially held on trust for him.

136.  It is the applicant’s case that the law is that it is for the defendant to prove with “cogent evidence” that what he is asserting is true and accurate, and that the defendant has failed to do so in relation to the 2 transfers to the law firm.

137.  The defendant replied in his 2^nd witness statement at paragraph 8 that he had “made several more attempts to contact the UK law firm or any relevant party”. The defendant did not include any information as to how the attempts were made, such as if they were made through his legal representatives, or his friends and relatives or even his wife, and whether the attempted contacts were by way of letters or calls. There is also no information as to whether he had filed a complaint with the SRA, and no related documents have been exhibited under this, or any of his 3 witness statements.

138.  At paragraph 14 of his 3^rd witness statement regarding the UK law firm transfers, the defendant claimed that he had “made attempts to contact the UK law firm again, but still failed to reach them at all since they had been shut down for years.” He reiterated that he has “absolutely no control over the money”, and that it should not be regarded as part of his realisable properties.

139.  Again, the defendant did not provide any details as to the attempts, nor any documents in support of that claim. There is no mention of any communications with the SRA, or whether he had filed a complaint with them at all.

140.  The 3^rd witness statement of DSIP Man did not touch on the topic of the UK law firm transfers, dealing only with the updated valuations of the watches.

FINDINGS ON ITEMS 3 AND 4

141.  For the following reasons, I find that the defendant has failed to prove on the balance of probabilities that any of the assertions regarding his interest in the watches and the funds transferred to the UK law firm he made in his 3 witness statements are true and accurate.

142.  Furthermore, it is my finding that the defendant holds as his property the 39 watches represented by the 40 hangtags found in his possession upon his arrest, including the one represented by the illegible hangtag, subject to discounting item 23.

143.  As far as the 6 watches that the defendant claims are held by this wife, I find that, had the defendant been able to prove that they belonged to his wife, the watches would still be caught under s.12(1)(b) as gifts caught by s.12(9) of OSCO, or as properties that are subject to the effective control of the defendant under s.12(1)(c).

144.  The defendant was arrested at the airport in possession of a boarding pass to a flight to the UK. He had with him a Transfer of Residence approval letter for himself issued by the United Kingdom’s HM Revenue & Customs department. He also had a set of document for moving his dog from Hong Kong to the UK.

145.  It is safe to infer that the defendant had planned to be uprooted from Hong Kong and to settle in the UK as at the time of his arrest, to perhaps meet up with his wife who was already there, whom at that time he had been married to for around 5 years, and having met her in around 2013.

146.  The defendant claimed in the letter he wrote in mitigation (dated 16 October 2023) that his wife “has lived a simple life”, and worked as a kindergarten teacher since graduation until 2020. He claimed to “have taken good care of her, providing a place for her to call home, putting food on the table” and “being (the) husband she could count on in any situation”. At the time of the writing of the letter, they had been married for over 5 years, and their relationship “has been stronger that (sic) ever”. His biggest worry since his arrest was his wife’s well-being. He has “voiced to myself that I will never put her in such a position again, and that I will try my best to make up to her in my rest of life (sic).”

147.  Given the defendant’s claimed role as his wife’s provider, one would expect him to have all the necessary arrangements for their family’s relocation to the UK, such as finding suitable accommodation, and planning for the financing of their new lives there completed before he was going to leave Hong Kong, or even before his wife left Hong Kong.

148.  Yet, the defendant has been silent in all of his 3 witness statements on these topics. There is no mention of rental payments that he was required to make for their accommodation in the UK, nor any mention of any property he or his wife owned in the UK. There is no mention of where he himself was supposed to be staying after landing in the UK, and whose property it would be that he would be staying at.

149.  There is no mention of any financial arrangements that he might have made to provide for his wife, both in the short and long term, which he must have done before boarding the plane on the night of his arrest.

150.  There has been no mention of any UK bank accounts, either in the defendant’s own name or in their joint names, or the reason why there may be no such bank accounts. This must be viewed alongside the letter of Transfer of Residence approval of the HM Revenue & Customs department that was found in the defendant’s bag. One would expect such approval would only be given upon proof of income or assets, which is unlikely not to involve the holding of a bank account. The lack of information of such bank account would point to the only reasonable conclusion that the defendant must not have made a full and complete disclosure of his assets, held directly or indirectly, in the present proceedings.

151.  The same apply to the defendant’s wife. Based on the defendant’s own evidence that she had applied for immigration to the UK through the law firm Matini Montecristo LLP, it is highly unlikely that she would not be required to disclose her means and assets during the course of her application. It is the defendant’s evidence that he was the one in contact with the law firm for her application, and he was making transfers either on her behalf or for her in the application, it is impossible for the defendant not to be aware of or to be in possession of some kind of documentation relating to his wife’s application, which would likely refer to their income and assets. Yet, there is no such documents exhibited, or even mentioned in any of the defendant’s witness statements.

152.  In relation to item 4, I find that the defendant is not telling the truth or the whole truth about the transfers made to the law firm. Based on the SWIFT transfer documents, the transfers were made for “personal investment” and “purchase of property” purposes, and the defendant has failed to disclose any information regarding investments being made and property being purchased. Even if the law firm did close down, such investments and property would not disappear together with the law firm and any interests held by the defendant and/or his wife would be traceable.

153.  It was put forward in the defendant’s mitigation that he “simply committed the offences out of job insecurity due to pandemic resulting in serious consequences to his career prospects and family”. There was no mention at all of him being in debt, or that it was one of the reasons he committed the offences. Furthermore, as the applicant had pointed out through DSIP Man’s evidence, it is obvious that the defendant fully intended to evade his debts as at the time of his deciding to leave Hong Kong.

154.  In addition to the lack of specific details concerning any realisable property that the defendant might be holding other than those that the applicant has been able to discover, the credibility and reliability of the defendant must also be considered in light of the circumstances around his commission of the offences.

155.  The defendant was clever and daring enough to have his name changed, twice and to two different names, so that he can open bank accounts in those new names to receive and deal with the stolen moneys. He also used at least one of those false names to conduct the sale and purchase of watches with Sun Moon, as evidenced in the purchase invoices and receipts stating the defendant’s name as “KOH Pang An”.

156.  The defendant was in possession of his wife’s bank documents and internet security device at the airport. In his 2^nd witness statement, the defendant seemed to be suggesting that he was merely helping his wife to move her personal belongings when they moved to the UK together[8], and that was how he came to be in possession of her banking device. I find this explanation to be untrue. It is stated in the Summary of Facts, which the defendant had admitted to, that the defendant “had full control” of his wife’s account with Nanyang Commercial Bank (account number 043-478-1-147055-1), being the account that the internet banking security device found on the defendant controlled.

157.  It is clear that the defendant is lying about the control he has over his wife’s properties or moneys in order to minimize the size of his realisable property.

158.  According to paragraph 9 of the Summary of Facts, one of the accounts under the name of “KOH Pang An” had received a total of US$314,067.26 cash deposits from unknown sources and from UBS and Century Trading (Asia) Limited between 2 June 2020 and 30 October 2020, and the money were swiftly withdrawn after the deposits, and a significant amount of the remittances were made to overseas counterparties. The defendant never disclosed who those overseas counterparties might be.

159.  Parallel to the dearth of evidence from the defendant in support of his various bare assertions concerning his realisable property, it would appear that the defendant has also made no attempt to comply with Tam J.’s order for disclosure of information related to his assets, income, profits and interest, etc. in HCA 413/2021.

160.  In relation to the amount of US$1,875,030.64 that was ordered to be paid by consent, at paragraph 47 of Tam J’s Judgment dated 20^th December 2024, he made the following order:

“The 1^st Defendant[9] shall, unless he has fully paid the amount of US$1,875,030.64 to the Plaintiff as required by the Order (by consent) of the Honourable Mr. Justice Tam dated 29 November 2024 (‘the Order By Consent’):-

(i) Provide to the Plaintiff a full and complete account of all the assets, income, profits, interest and other benefits derived from the amount of US$569,581.03, failing which the Plaintiff do have liberty to apply for further directions on the process of account; and

(ii) Pay the amount due upon the provision or taking of the account forthwith, subject to the 1^st Defendant’s liability to pay under the Order By Consent and not exceeding the amount of US$1,875,030.64;”

161.  The US$569,581.03 in paragraph (i) of the said order refers to the amount that the defendant had “admitted in criminal proceedings that he had stolen funds from P by causing 5 transfers (of US$569,581.03 in total) to be made to three bank accounts that he had opened with false names.”

162.  As of the time of the confiscation hearing on 14^th July 2025, the defendant had had 6 months and 24 days to comply with the order, and he had not done so.

163.  I find that it is clear and obvious that the defendant has all along planned for his escape from Hong Kong after the thefts, using the money laundering to ensure that the ill-gotten gains from his crimes would not be traceable, so that he and his wife will be able to enjoy the fruits of his thefts together.

164.  I find that it is an irresistible inference that the defendant is hiding his assets from the court so as to try to deflate the “amount to be recovered” under s.11.

165.  I accept the applicant’s latest updated valuation of the watches. The defendant had not tried to rebut the applicant’s assertion that all the watches represented by the hangtags are in mint condition. He merely contested the valuation of the watches, stressing that that they were second hand, but it is common knowledge that second hand items can still be in mint condition, especially when the re-trading of the item has always been the primary objective of the holder of that item, which the defendant has claimed to have been, as a ‘collector’ of watches.

166.  Save for item 23 in Mr. John Ng’s report, I find that the defendant has failed to prove that he did not own the actual 39 remaining watches represented by the hangtags. He has also failed to provide his own expert valuation of the value of any of the watches, and thus have not been able to support his bare assertion that the applicant’s expert valuation is “overwhelmingly high”.

167.  As mentioned in Mr. Ng’s expert reports, of the 40 hangtags, one (item 40) is illegible as to the model number of the represented watch and so there was no valuation of this item. Item 23, the watch represented by hangtag with serial number s/n 08JH3729 has been shown to have been sold to Sun Moon and so is no longer to be regarded as the defendant’s realisable property.

168.  I find that, based on Mr. Ng’s latest valuation report, the combined market value of the 38 watches, after ignoring item 40 and deducting item 23’s value of HK$600,000, is HK$8,649,000, and the value of the 4 returned watches is HK$4,190,000. The total value of the 42 watches, which I find are the realisable properties of the defendant, should, therefore be, $12,839,000.

169.  When added to the 2 transfers of the UK law firm of HK$3,256,712.85, the AMBR becomes HK$16,095,712.85. = 11905712.85 = 12,200,461.79.

170.  To this figure is also added the uncontested realisable properties in items 1 and 2, which is, respectively, HK$127,177.71 (HSBC savings account) and HK$167,571.23 (cash on the defendant), taking the total AMBR as far as the applicant has been able to uncover to HK$16,390,461.79, which is around US$2.1 million.

171.  The applicant has, however, indicated that the value of the 4 returned watches should be taken out from the calculation of the AMBR, because they should be forfeited separately under s.102 of the Criminal Procedure Ordinance, Cap.221, and then delivered to UBS as partial settlement of the judgment debt in HCA 413/2021. This is also the defendant’s position.

172.  It is also the applicant’s position that they are prepared to accept that, despite their assertion that items 1 to 4 are not the only realisable property of the defendant, the AMBR can be regarded as the value of the 4 items, less the 4 returned watches.

173.  That being the case, the defendant’s AMBR would then be lowered by the value of the 4 watches at HK$4,190,000 to HK$12,200,461.79 which is around US$1.56 million, and which is less than the VoP.

174.  Since the AMBR is less than the VoP, the Amount to be Recovered is the lesser figure of HK$12,200,461.79.

175.  For the sake of clarity and completeness, I will set out the steps this court is required to follow in the making of a confiscation order.

THE MANDATORY ACTS TO BE FOLLOWED

WHETHER BENEFITED AND IF AT LEAST HK$100,000

176.  Upon application, the first mandatory act this court has to perform is to determine “whether the person has benefited from the specified offence or from that offence taken together with any specified offence of which he is convicted in the same proceedings, or which the court proposes to take or has taken into consideration in determining his sentence”.

177.  Since theft and money laundering are both defined as ‘specified offence’ in OSCO, this court is, therefore, allowed to take into consideration all 4 counts when determining whether the respondent has benefitted from the offences.

178.  Having taken into consideration all the circumstances of the defendant’s commission of the thefts, I have determined that he did benefit from the thefts, and that the proceeds of the thefts are in total at least HK$100,000. This is the statutory threshold figure provided for in s.8(4).

AMOUNT TO BE RECOVERED UNDER THE CONFISCATION ORDER

179.  The next mandatory act under s.8(6) is to “determine in accordance with section 11 the amount to be recovered (ATBR) in his (the defendant’s) case by virtue of this section.”

180.  Under section 11, “the amount to be recovered in the defendant’s case under the confiscation order shall be the amount the Court of First Instance…assesses to be the value of the defendant’s proceeds of any specified offence to which section 8(4) applies...”.

181.  The specified offence to which s.8(4) applies are the two thefts, or the thefts “taken together with” the two money launderings, as mentioned above.

MY ASSESSMENT

182.  Pursuant to s.10 of OSCO, this court may rely on statements tendered by the prosecutor when determining whether the defendant has benefited from the thefts; and when assessing the value of the defendant’s proceeds of the thefts.

183.  While the value of the defendant’s proceeds from the thefts does not change once assessed, the amount to be recovered under the confiscation order can be subject to adjustments.

184.  I have already found that the Amount that Might Be Realised at the time of the confiscation order is LESS than the Value of Proceeds of the offences (AMBR < VoP), therefore, the Amount to be Recovered then becomes the lesser amount of the AMBR under s.11(3)(a).

185.  Based on the three s.10 statements of DSIP Man, I find that the Value of Proceeds of the offences is USD$1,875,030.64.

186.  This is the figure accepted by the applicant to ensure that the defendant would not be doubly punished.

187.  The defendant himself does not dispute this is the correct figure of his “proceeds of crime”[10], and has stated that he raises “no objection that the total proceeds of all 4 charges be regarded as HK$14,649,437.14 which represented the proceeds of the two theft charges”[11].

188.  The amount to be recovered under the confiscation order pursuant to s.11 is, therefore, HK$12,200,461.79 being the lesser AMBR.

THE ORDER

189.  Upon the satisfaction of all the requirements prescribed by the relevant provisions regarding the imposition of a confiscation order, pursuant to s.8(7) of OSCO, in respect of the 2 thefts and the 2 money laundering offences, I order the defendant to pay the amount of HK$12,200,461.79.

190.  Pursuant to s.13(1)(a)(i) of OSCO, I order this amount to be paid forthwith from the date of this Confiscation Order. I have considered and am satisfied that, based on my finding that the defendant has hidden his assets from this court, and based on the fact that he had made no contribution towards settling any of his civil debt in HCA 413/2021, save for his agreement for the 4 returned watches to be so used, there is no reason to allow a longer time for payment.

191.  Pursuant to s.13(1)(a)(ii), I order that if any of that amount is not duly paid forthwith, the defendant is to serve a term of imprisonment. Pursuant to s.13(4), this term of imprisonment “shall not begin to run until after the end of the term of imprisonment” of 7 years imposed on the defendant by this court on 7^th November 2023.

192.  The term of imprisonment must be made with reference to the maximum terms of imprisonment set out in the table in s.13(2):

Amount	Maximum Term of Imprisonment
An amount not exceeding $200,000	12 months
An amount exceeding $200,000 but not exceeding $500,000	18 months
An amount exceeding $500,000 but not exceeding $1 million	2 years
An amount exceeding $1 million but not exceeding $2.5 million	3 years
An amount exceeding $2.5 million but not exceeding $10 million	5 years
An amount exceeding $10 million	10 years

193.  Bearing in mind that the amount to be paid is around $2.2 million above $10 million, I find that a fair, just and balanced term would be 5 years and 6 months’ imprisonment in the circumstances.