HKSAR v. CHAU HIU KANG

DCCC 558/2024

[2026] HKDC 108

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 558 OF 2024

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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 someone.

Summary of Facts

2.  On 25 August 2020, the defendant opened a personal savings  account (No.60750126186)  with CMB Wing Lung Bank Limited (the "Account").  In the opening mandate, she claimed to be self-employed in the education field with a monthly revenue below $100,000.

Cryptocurrency deception

3.  On 8 July 2020, Madam Cheung (PW1)  became acquainted with someone (Male A)  on a social networking app.  Male A invited PW1 to invest in cryptocurrencies by clicking a link ("the Investment App").  On 14 September 2020, PW1 transferred a sum of $60,000 from her own bank account to the Account pursuant to directions given by the Investment App.  Subsequently, PW1 could no longer log onto the Investment App and Male A became out of touch.  The police was alerted.

Deposits and withdrawals

4.  Between 14 September and 29 October 2020, the Account received 107 deposits, which aggregated to a sum of $2,826,255.26 (including the $60,000 from PW1).  Simultaneously, the same aggregated sum was withdrawn from the Account by 94 withdrawals.  The Account was closed on 29 October 2020.  Based on the timing and amount of the deposits and withdrawals, the police found a "mirror pattern" in those transactions, which is a typical indicator of money laundering.

5.  The defendant was arrested on 29 May 2023.

Mitigation & Sentence

6.  The defendant is 44 and has 4 conviction records involving 5 offences unrelated to money laundering.  Defence counsel Mr. Li informed me that the defendant is not married but has 1 daughter and 2 sons.  She was unemployed at the time of her arrest.  She resides in a public housing unit in Tseung Kwan O.  In mitigation, Mr. Li submitted that the defendant simply lent her bank account to someone for his/her use.

7. 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. Mr. Li did not object.

8. 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]."

9. I have read the witness statement of CIP Li dated 29 December 2025. 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.

10. There is clear and cogent evidence before me that money laundering through bank accounts opened by "ML Stooges" remains widespread in Hong Kong today. What true criminals need are gullible scapegoats, like the defendant in the present case, who would take the blame for them when law enforcement takes action. 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.

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

12. 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]

13. 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.

14. 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]

15. I accept there is no evidence showing that the defendant was involved in or had any knowledge of the investment scam against PW1. As the sole owner of the Account, the defendant should have retained its ultimate control and paid attention to its transactions on a regular basis. On the other hand, I cannot overlook the fact that a total sum of $2.8 million odd went through the Account within almost 1.5 months.

16. 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.

17. I consider a starting point of 3.5 years' imprisonment appropriate and just[4]. With the timely guilty plea, the sentence is reduced to 28 months. Apart from this, I see no other mitigating factors which warrant any further reduction. With the 25% enhancement, I sentence the defendant to 35 months' imprisonment.