HKSAR v. LAOLY PHOUNGEUN AND OTHERS

DCCC 734/2018

[2019] HKDC 1638

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 734 OF 2018

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REASONS FOR SENTENCE

1.  D4, a citizen from Mainland China pleads guilty to one charge of using false instruments, contrary to section 73 of the Crimes Ordinance (charge 3) [1]. D1, D2 and D3, citizens of Laos, plead guilty to possession of the false instruments, contrary to section 75 (2) of the Crimes Ordinance (charge 2)[2].

2.  Full particulars of the offences are set out in the summary of facts admitted by the defendants on 3 December 2019. 

3.  In summary on 11 May 2018 the defendants, together with Simon Sayfe and Bardeja Kishore, went to HSBC Main Building, No. 1 Queen’s Road Central.

4.  Simon approached Mr Ng, a Senior Customer Service Officer, requesting to make a transfer.  D2 gave Simon an envelope from which Simon took out what appeared to be a bank instrument issued by HSBC and handed it to Mr Ng.  Mr Ng suspecting the instrument was false said he needed to verify the instrument and asked the group to wait.

5.  Mr Ng notified his supervisor Mr Lam, a Customer Service Manager.  Mr Lam invited the group to a meeting room where Kishore indicated that D4 had some bank instruments to be verified.  

6.  D4 then gave Mr Lam the false instruments particularised in the charge, including a Certificate of Deposit in the sum of USD6.3 billion deposited by ‘Jin Di’ and bearing account number 0045231365101, together with two powers of attorney (authorization letters) purporting to authorise D4 to manage the USD6.3 billion on behalf of Ms Jin Di. 

7.  Kishore said that if the instruments were genuine he would like to have the money transferred to a bank account in Cambodia.

8.  Mr Lam then left the meeting room to verify the instruments.  Mr Lam checked the bank’s computer system and found that there was no client named ‘Jin Di’ or account number 0045231365101. 

9.  On a subsequent examination Mr Law, a Regional Operations Manager with HSBC, found that all the instruments were not issued by HSBC and were therefore false. 

10.  The case was reported to the police and the defendants arrested.  The police found from D3 various documents including contractual documents, some of which bore D4’s signature and an affirmation of D4 purporting to show the monies were lawful clean funds. 

11.  In a video recorded interview D1, inter alia, admitted that he was asked by D4 to act as her interpreter in return for 1% commission; D4 came to Laos and handed him some documents which were passed to a company in Vietnam and that he was asked to accompany D4 to Hong Kong.

12.  In a video recorded interview D2, inter alia, admitted that D1 told him that D4 wanted to transfer some money from HSBC; together with D3 they found a company in Vietnam to help with the transfer; he was asked to accompany D4 to Hong Kong and that he coordinated the trip for which he would be paid USD30-40 million.

13.  In a video recorded interview D3, inter alia, admitted that the documents seized by the police had been given to him by someone in Vietnam; he was required to interpret the documents to D4 for which he would receive USD2.5 million and that he was asked to go to Hong Kong to meet some Australians who thought the instruments were real.

14.  In two video recorded interviews D4, inter alia, admitted that she had obtained the false instruments in Kunming from a third party which she passed on to someone else in Laos where she subsequently met D1, D2 and D3; she signed documents which she could not understand and that she would be paid by the Laos people upon verification of the instruments.

D4

15.  I will first give my reasons for sentence of D4 who pleads guilty to using the false instruments. 

16.  I have had the opportunity of looking at all the false instruments together with the powers of attorney (authorization letters) and the documents found from D3.

Mitigation

17.  In passing sentence, I have carefully considered the oral and written submissions of Mr Lam, including D4’s early plea of guilty and that D4, aged 54 with a clear record, was made use of by others who preyed on her greed and ignorance[3]. 

18.  Mr Lam submits that looking at the quality of the false instruments there was no chance of success and therefore the actual prejudice to the bank was negligible[4].  Mr Ross on behalf of D3 makes a similar submission that there was little chance of the defendants ever succeeding in obtaining the money. 

19.    Whilst there may have been little likelihood of success there was clearly a degree of planning and preparation in the commission of the offence.  The day before they went to HSBC the defendants came to Hong Kong together from Laos bringing with them supporting documents including the powers of attorney which were submitted to the bank purporting to show the deposit was genuine.  Coming to Hong Kong to commit a crime is a serious aggravating feature of sentence[5].

Sentence

20.  I have considered the decision in HKSAR v Mazhar Taha Ahmed Elmansouri[6]where the Court of Appeal upheld a sentence of 5 years’ imprisonment for using a false bank draft in the sum of US$10 million.  The Court of Appeal also reviewed a number of similar cases where sentence ranged from 2½ years to 4½ years imprisonment.  However the court stressed that “the citation of individual cases for the purpose of comparing sentences is of limited assistance since the particular sentence in anyone case must depend on the individual facts of the case”[7].

21.  Taking into account the amount of the false instruments USD6.3 billion; there was little likelihood of success; the bank suffered no loss; the defendant came to Hong Kong from Mainland China via Laos to commit a crime and that the defendant has a clear record, I am satisfied the appropriate sentence after trial is 3 years’ imprisonment.

22.  D4 having indicated her plea of guilty at the time the case was set down for trial is entitled to the full one-third discount.  D4 is convicted and sentenced to 2 years’ imprisonment. 

D1, D2 & D3

Mitigation

23.  In passing sentence, I have taken into account everything said on behalf of D1 by Mr Iu, including that D1, aged 34 with no previous convictions, has two young children to look after in Laos and that his role was limited to acting as an interpreter.

24.  I have carefully considered the oral and written submissions of Mr Sher made on behalf of D2, including that D2 aged 39 and with a clear record, has a young daughter to look after in Laos and whose role was limited to bringing the documents to Hong Kong to handover to two Australians[8].

25.  I have taken into account everything said on behalf of D3 by Mr Ross, including that D3, aged 63 with a clear record, was also acting as an interpreter. 

Sentence

26.  Whilst the starting point for possession of the false instruments must be less than that for offences of using false instruments and possession with the intention of using false instruments, the court is not to overlook that the possession of the false instruments by the defendants was in the bank and at the same time the false instruments were being used by D4 who they accompanied from Laos to Hong Kong. 

27.  I have considered the sentence cases cited by Mr Sher[9].  The facts of those case, one of which concerns possession of a false travel document by an illegal immigrant attempting to land in Hong Kong, are very different and did not involve possession of false instruments in a bank or at the same time as the false instruments were being used.

28.  Mr Sher also refers to the fact that he does not know why and under what reason Simon and Kishore were not prosecuted[10].   

29.  Mr Tracy confirms they were arrested and placed on police bail but left the jurisdiction whilst on bail.  Mr Tracy is unaware of why Simon and Kishore, who were also visitors to Hong Kong, were given police bail. 

30.  Although this is somewhat unsatisfactory, I am satisfied that the fact Simon and Kishore have not been prosecuted does not impact upon the prosecution of the defendants.

31.  Whilst the defendants may not be the masterminds they each played an important role which required them to come to Hong Kong and for which they would receive substantial reward.  D2 admitted he was to coordinate the trip for which he would receive USD30-40 million if the trip was successful.  D1 and D3 both said they were interpreters and would receive 1% commission and USD2.5 million respectively, sums which are inconsistent with merely being interpreters.   

32.  Taking into account the amount of the false instruments USD6.3 billion; there was little likelihood of success; the bank suffered no loss; the defendants came from Laos together to commit a crime; the roles of the defendant; the benefits they expected to receive and that the defendants all have clear records, I am satisfied the appropriate sentence after trial for D1, D2 and D3 is 2 years and 6 months’ imprisonment.

Timely plea

33.  D1, D2 and D3 first appeared in the District Court on 13 September 2018 and indicated pleas of not guilty on 26 March 2019 when the case was set down for trial commencing on 2 December 2019.  The sentencing guidelines in HKSAR v Ngo Van Nam therefore apply[11].

34.  On 2 December the parties applied for an adjournment so that the prosecution could consider the laying of an alternative charge of possession against D1, D2 and D3.  On 3 December D1, D2 and D3 pleaded guilty to possession of the false instruments. 

35.  Mr Iu, Mr Sher and Mr Ross all ask that the defendants be given the full one-third discount for pleading guilty to the alternative charge, Mr Iu pointing out that possession is not a statutory alternative. 

36.  Complaint is made as to the late service of the transcriptsof the video recorded interviews.  These were only served last week seemingly due to the difficulty in obtaining translation of the Lao language.    Mr Tracy has submitted to court a chronology relating to the obtaining of transcripts. 

37.  Mr Ross has also submitted correspondence showing the requests made by his solicitors for translations of D3’s video recorded interview.  Mr Ross also complains that a copy of the disc of the video recorded interview was not served on the defence until the beginning of November 2019. 

38.  I understand the interviews were conducted in Chinese and translated into English and Lao.  Summaries were prepared before the case was set down for trial after which transcripts were prepared.  The only summary I have seen is that included in the summary of facts dated 10 September 2018 and submitted to court for the first appearance in the District Court on 13 September 2018. 

39.  From this summary defence counsel would know the essence of what was said by each defendant and could clearly have taken instructions on the roles of the defendants and advised them accordingly.  Further, on completion of the video recorded interviews defendants are supplied a copy of the disc which could have been supplied to the legal representatives at a very early stage to enable them to advise the defendants prior to the case being set down for trial. 

40.  I am satisfied the defendants could have indicated a plea of guilty to possession when the case was set down for trial.  Section 51(2) of the Criminal Procedure Ordinance provides that a court may on a trial where the allegations in the charge amount to or include, whether expressly or by implication, an allegation of another offence falling within the jurisdiction of the court of trial, find the accused guilty of that other offence[12].

41.  Further, in HKSAR v Ngo Van Nam the court drew a distinction between what was the first reasonable opportunity for a defendant to indicate his guilt and the stage where a defendant exercised his undoubted right to avail himself of the opportunity for his lawyers to assess the strength of the case against him. 

42.  The defendants having been arrested inside the bank I am satisfied this is not a case where the defendants genuinely did not know whether they were guilty or not and needed advice or sight of the evidence in order to decide whether to plead guilty to mere possession[13].

43.  Although the defendants only pleaded guilty on the second day of trial, the trial having not started I am satisfied they are entitled to a discount of 20% which reduces the sentence to 2 years’ imprisonment.

44.  D1, D2 and D3 are convicted and sentenced to 2 years’ imprisonment.

[1] Cap 200. 

[2] All four defendants were jointly charged together with Sayfe Simon and Bardeja Kishore with using the false instruments (charge 1).  Mr Tracy explained that the prosecution applied to prefer alternative charges of possession against D1, D2 and D3 (charge 2) and a joint charge of using false instruments against D4 together with Sayfe Simon and Bardeja Kishore only (charge 3) because of evidential difficulties, in particular that the video recorded interviews of D1, D2 and D3 which were conducted in Chinese, English and Lao were not certified due to the unavailability of a Lao interpreter to certify them. 

[3] See §§3, 5, 6, 12 & 13 of the written mitigation of D4.

[4] See §§9, 11 & 13 of the written mitigation of D4.

[5] In mitigation all defence counsel confirmed the defendants came to Hong Kong on 10 May 2018.   

[6] CACC 165/2012.

[7] §70 of the judgment. 

[8] See §§1, 3 & 4 of the written mitigation of D2.

[9] See §§9-14 of the written mitigation of D2.

[10] See §6 of the written mitigation of D2.

[11] [2016] 5 HKLRD 1.

[12] Cap 221.  Also see Archbold Hong Kong 2019 §§4-299-300.

[13] See §201 of HKSAR v Ngo Van Nam.