HKSAR v. CHEN JINGHUA

DCCC559/2012

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 559 OF 2012

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Reasons for Sentence

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1.  The Defendant has pleaded guilty to one count of dealing with property known or reasonably believed to represent the proceeds of an indictable offence, contrary to section 25(1) and (3) of the Organised and Serious Crimes Ordinance, Cap.455.

Admitted facts

2.  In summary, PW1 (a 79-year-old Taiwanese female), who lived in Zhanghua city, was the victim of a telephone scam (“the telephone scam”).  She was deceived into depositing a total of TWD4.1 million into a Taiwan Chinatrust Commercial bank account numbered 101540051272 (“Account A”) in the name of Ho Yung-chun between 2 and 23 December of last year.

3.  She later discovered that it was a scam and the matter was reported to the police.

4.  Investigations show that part of the proceeds of the telephone scam was remitted from Account A to an HSBC account numbered 509-601357-833 held in the Defendant’s name (“Account B”).  Namely, a sum of US$63,000 was remitted to Account B on 16 December of last year and a further sum of US$79,998.07 was remitted to Account B on 28 December last year.

5.  The defendant is a PRC citizen.

6.  He opened Account B on 24 November last year and was the sole signatory thereof.

7.  After the proceeds were remitted to the foreign currency account of Account B, it was immediately transferred to the savings account of Account B and was withdrawn in cash on the same day.  All the transfer and withdrawal slips were signed by the defendant.

8.  According to the defendant’s movement record, the defendant only travelled to Hong Kong on four occasions between January 2002 to February 2011.  He was in Hong Kong on both occasions when the proceeds were withdrawn from Account B and he left Hong Kong within an hour after the withdrawal of the proceeds.

9.  Account B was closed on 24 February of this year. 

10.  The defendant was arrested on 30 April this year when he entered Hong Kong via the Lo Wu control point.  He remained silent under caution.

11.  In a subsequent video recorded interview, the defendant claimed that the proceeds were a loan from his cousin in Taiwan to fund his telephone and computer business.  He claimed that the funds were used to purchase telephone and computer accessories in Hong Kong for resale.

12.  He was unwilling to provide further details of his purchases, claiming that they were trade secrets.

13.  He was unable to provide any documents to prove the existence of his business.  The defendant claimed that Ho was his cousin in Taiwan and there was an ambiguous agreement for a loan of RMB50,000.

Mitigation

14.  The defendant is aged 28.  He has a clear record in Hong Kong.  He worked as a garage mechanic in China, earning about RMB2,000 per month.  He is married and has a son aged 5.  His wife is now 5 months’ pregnant.  He also lives with his elderly parents.

15.  He admits that he had agreed to deal with the proceeds for a reward of HK$4,000.

16.  Counsel submitted that the defendant has pleaded guilty, which is an indication of his remorse.

17.  He also submitted a letter written by the defendant asking for leniency.

Sentence

18.  There is no dispute that the applicable sentencing principles are those set out in Hsu Yu Yi (CACC 159/2009) and adopted in Wan Kwok Keung (CAAR 13/2012) and Hou Shun Hsiung (CACC 472/2009).

19.  I have considered the facts of this case, the mitigation and the cases cited very carefully.

20.  The relevant factors to consider include:

(1) the amount involved in the transaction - this is a very important consideration - and not merely the benefit received by the defendant;

(2) the gravamen of the offences, the assistance rendered for the commission of the indictable offence, and hence the extent of the defendant’s participation and the number of transactions in the money laundering are relevant;

(3) the indictable offence and the money laundering charge may not necessarily have a direct connection, but if the indictable offence can be identified, then the court in considering the penalty for the money laundering offence may take into account the sentence related to the indictable offence;

(4) the court may adopt a more serious sentence if the case involved an international element in order to ensure that the reputation of Hong Kong as an international financial and banking centre may not be damaged;

(5) the length of the time of the offence.

21.  In the present case, there were only two transactions and the length of time involved was only about a month.

22.  However, there was an international element.  There is no dispute that the funds came from a Taiwanese account and were remitted into the defendant’s foreign currency account.  The defendant admitted that he knew that the money came from Taiwan.  The defendant came to Hong Kong specifically to commit the offence.

23.  The defendant committed the offence for a reward.

24.  I understand that there is no evidence that the defendant knew how the proceeds were obtained.

25.  However, the indictable offence was one of telephone fraud, which is very prevalent, and the court is entitled to make reference to the nature of that offence when considering sentence.

26.  After consideration of all those matters, I adopt a starting point of 3 years’ imprisonment.

27.  The defendant has pleaded guilty.  I give him full credit for his guilty plea.

28.  The sentence is reduced to 2 years.