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DCCC 895 2011
IN THE DISTRICT COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
CRIMINAL CASE NO.895 OF 2011
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HKSAR |
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PANG Hung-fai |
Defendant |
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Before:
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Douglas T.H. Yau, District Judge
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Date:
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17th January 2012 at 9:33am
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Present:
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Mr. Raymond Cheung, Senior Public Prosecutor for HKSAR
Mr. B.K. Ho & Mr. Nelson Lam, instructed by M/S King & Company, for the defendant
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Offence:
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Dealing with property known or believed to represent proceeds of an indictable offence
(處理已知道或相信為代表從可公訴罪行的得益的財產)
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Reasons for Sentence
1. The defendant was convicted after trial of one charge of dealing with property known or believed to represent proceeds of an indictable offence, contrary to s.25(1) and (3) of the Organized and Serious Crimes Ordinance, Cap.455. The maximum sentence is that of a fine of $5 million and 14 years’ imprisonment.
Summary of Facts
2. The defendant and one Mr. KWOK Wing were close friends. Mr. Kwok was the chairman and major shareholder of a Hong Kong Stock Exchange listed company known as Tack Fat.
3. On 4th June 2008 Kwok caused a total of 40 million share options to be granted to 2 mainlanders. The options were exercised 2 days later by the 2 mainlanders but Tack Fat never received any money for the shares. Between 16th June and 29th July 2008, all 40 million shares in the name of the 2 mainlanders were sold in the stock market. The defendant had no knowledge of any of the share dealings between Kwok, the 2 mainlanders and Tack Fat.
4. $14,049,380 of the money from the sale of the shares were eventually deposited into the defendant’s company bank account on 1st August. 26 days later, the same amount (less bank charges) was remitted by the defendant to Kwok’s company bank account in Cambodia.
5. It was found after trial that Kwok, Guo and Pan had conspired to defraud Tack Fat and its shareholders and the money from the sales of the shares issued to Guo and Pan after their purported exercising of their share options were proceeds from the indictable offence.
6. It was further found that given the substantial amount of money being received, given the fact that the money was coming from someone who is from outside Hong Kong, given the fact that the defendant did not know the 2 mainlanders from whose account the money came from, given the fact that no reason was given by Kwok to the defendant as to why Kwok needed the defendant to receive and then hold the money, given the fact that the money was then remitted out of Hong Kong to Cambodia within a short time without anything being done with the money, those facts when viewed together would lead a “common sense, right-thinking member of the community” to have reasonable grounds to believe that the money dealt with by the defendant represented proceeds of an indictable offence. Since all those facts were known to the defendant, he was convicted of the charge.
Previous convictions
7. The defendant is of clear record.
Mitigation
8. The defendant is 66 years old. During the evidence in chief of the defendant as led by Mr. Bruce, S.C., the defendant gave a full account of the history of his life and most of that evidence are in my Reasons for Verdict and I shall not repeat them here.
9. Weighty letters from the defendant’s friends and business partners were submitted in mitigation. Mr. Mark Rooke-Ley was called by the defence as a character witness in mitigation. According to Mr. Rooke-Ley, the defendant is the “most respected, honest, trustworthy and wholesome person…to have...as a friend and…business partner.” The defendant has guided the witness in his business life with the utmost of integrity.
10. The contents of the rest of the mitigation letters are along the same admiring line. It is obvious that the defendant has always been someone who is ready to lend a helping hand to whoever is in need.
Sentencing cases
11. Mr. Bruce referred to the case of HKSAR v Javid Kamran, CACC 400/2004. It is his submission that the various factors identified by the Court of Appeal in paragraphs 35 and 36 when considered are mostly either not applicable or for those that are applicable, such as the benefit derived by the launderer, they are in favour of the defendant in our present case.
12. But as Yeung JA said at paragraph 34 of the judgment, it is not feasible to lay down guidelines for sentence of money laundering offence as there is a very wide range of culpability.
Sentence
13. As a result of the defendant’s laundering of the $14 million, Tack Fat and ultimately the shareholders of Tack Fat suffered losses. Kwok is still at large, no doubt in part sustained by the money that the defendant had sent to Cambodia. Although the defendant had offered to assist in the apprehension of Kwok, nothing has as yet come of it and there can be no discount on the sentence on this ground.
14. Hong Kong’s reputation as an international finance centre is slightly tarnished as a result of Kwok’s conduct. The defendant in dealing with the money as he did contributed to that.
15. There is a need to deter those who think there is no harm to help out a friend in need by turning a blind eye to money with dubious sources.
16. There is an international element in the offence in that those who transferred the money to the defendant were mainlanders and that the money were later transferred out of Hong Kong to Cambodia.
17. The amount involved is $14 million, by no means a small figure. I am however prepared to regard the dealing as a one off incident since the money was deposited and then remitted out of the defendant’s company’s account within a short period of time.
18. I find that bearing in mind all the circumstances of the case a proper starting point is that of 3 years’ imprisonment.
19. I am however prepared to take into account the positive good character of the defendant and reduce this sentence by 6 months. I am giving him this relatively big discount for the following reasons.
20. The defendant has given much to the community, both in Hong Kong and in the mainland. He is a charitable person and still has much to offer to the society.
21. The fact that such a well loved and respected person who has led an unblemished life and has achieved so much has been convicted of a criminal offence is itself a serious punishment.
22. As I explained in my reasons for verdict, the defendant turned a blind eye to all the grounds that would have pointed to the conclusion that the money was from an indictable offence. However, given the defendant’s generous nature and his devotion to his friends as described by Mr. Rooke-Ley so sincerely in the witness box, it is not difficult to understand why the defendant did what he did to help out his friend.
23. The defendant is sentenced to 2 and a half years’ imprisonment.
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Douglas T.H. Yau
District Judge |
Please refer to CACC34/2012 for the relevant appeal(s) to the Court of Appeal. |