HKSAR v. GONZALES TARA ROSE

DCCC 1342/2024

[2025] HKDC 2148

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 1342 OF 2024

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REASONS FOR VERDICT

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1.  The defendant has pleaded not guilty to a single charge of dealing with property known or believed to represent the proceeds of an indictable offence contrary to Section 25(1)  and (3)  of Chapter 455.

2.  Defence came to light as a result of the investigation of a false Mainland investigation scam which defrauded PW1 out of a sum of $609,050.  This money was transferred on 10 November 2021 to an account in the Bank of China in the defendant’s name and in which she was the sole signatory.

3.  Investigation of the account showed it was the defendant’s personal account in her sole name with her as the sole signatory.  The account was opened on 4 October 2011 by the defendant with little activity in it until 10 to 11 November 2021.  When totalling $2,466,233.38 was deposited by bank and ATM transfer and $100,000 cash into the account and also $2,566,153.83 was withdrawn from the account by bank and FPS transfer.

4.  The bank account was closed by the bank on 8 December 2021.  The defendant ’s plea of not guilty is based on her evidence that on 28 October 2021, she found the ATM card for the account to be missing. The ATM card had attached to it, PIN number, P-I-N number for the account and also she said the user name and password for internet banking for the account.

5.  The defendant reported the loss of the card to the bank.  On 4 November, she attended the bank to initiate the process of being given a new card.  Due to an error in the address held by the bank, it would appear the card was never received by the defendant.  Defendant said she was unaware of the transactions in her account on 10 and 11 November and had no part in them.  The defendant’s case being that although the fact of possession and control of the account could lead to an inference that she dealt with the monies in the account on 10, 11 November and thereafter, that inference could not be drawn beyond reasonable doubt because of the possibility that another person had access to both the old and new cards with full details of how to access those accounts.

6.  It was not to be contested that the account transaction pattern was consistent with the account being used as a temporary repository of funds including of those obtained from PW1 nor that the total amount was not commensurate with the defendant’s financial status and that any person dealing with the account would have had reasonable ground to believe that the total amount deposited between 10 and 11 November 2021 represented any proceeds of an indictable offence.

7.  The prosecution case was established by a set of Admitted Facts.  In essence they detailed the fraud practice on PW1. The deposit of monies into the defendant’s account on 10 November 2021 and thereafter.  The operation of that account and that the defendant was the sole signatory and also all the deposit made into and out of the account in the period 10 and 11 November 2021.  That the defendant reported to the bank the loss of her ATM card for the account on 28 October 2021.

8.  The bank procedure for lost ATM card is set out including the once reported as lost, the bank would freeze and disable the lost card immediately that the customer then applying in person at a bank branch for a replacement card and after her identity is verified the card will be sent to the customer’s address held by the bank by mail.

9.  It was agreed that the PIN of the replacement card would remain unchanged and that activation of the card could be made at an ATM machine.  Details of the defendant’s arrest interview and in camera also agreed and that the defendant present in Hong Kong throughout the relevant period.  Whilst the defence evidence is concerned, the defendant gave evidence.  The defendant evidenced that she opened the BOC account on 4 October 2011.  It was to receive her salary whilst she worked at Players in Wan Chai. She had an ATM card and internet banking on the account.

10.  After she left Players in 2012, the account was barely or rarely used by her.  Defendant said she was forgetful herself.  She wrote the bank of the ATM card on a small piece of paper, stuck to the back of the ATM card, on it was written her user name and password for internet banking but also the ATM PIN number.

11.  On 28 October 2021, she discovered her BOC ATM card was missing.  She searched for a few days and couldn’t find it.  She reported the loss of the card.  She provided details of her identity.  The defendant said the bank told her they would freeze the account and she would need to come to the bank for replacement card.  She went to the branch to get the new card on 4 November 2021.  The bank asked for her address.  She informed them orally, it was Flat B, 8^th Floor, Hennessey Apartment, Percival Street, Wan Chai.

12.  The defendant did not receive the ATM card in the post.  She had no knowledge of the transactions that conducted on 10, 11 November 2021.  She did not allow anyone else to use her account.  Exhibit D1 produced part of the defence case.  The information acquired by the bank at the time when the ATM card was reported lost and the defendant went to the bank. The bank recorded her address as Room E, 8^th Floor, Block 48 Hennessey Apartment, Percival Street in Wan Chai.

13.  Prosecution case simply stated is the defendant’s evidence should be rejected.  The inference drawn that it was the defendant who dealt with the funds in the account and the defendant would have had reasonable grounds to believe that those funds represented the proceeds of crime.  The defendant’s case as submitted was the evidence raised the possibility that others could have had access and control of the account.  This was sufficient and created a reasonable doubt as the inference could be drawn that the defendant dealt with the funds in the account.

14.  This left the sole issue between the parties.  With the creditability and reliability or otherwise of the defendant.  The defence simply has the evidential burden of raising a reasonable doubt as whether the defendant in fact dealt with the account.  It said that would be met by the defendant’s evidence, which meant the inference of the defendant dealt with the proceed of crime in the account, take the  money in the account could not be drawn to a criminal standard.

15.  The legal requirement as follows, the prosecution must prove the case.  The burden to do so remains upon them throughout the proceedings.  Facts must be proved beyond reasonable doubt. Furthermore, if an inference is required to be drawn to establish effect, then that inference must be capably be drawn to a criminal standard or beyond a reasonable doubt.  Dealing in Section 21A of Cap 455, includes receiving or requiring the property.  The case being the defendant received the property into her BOC account of the relevant dates.

16.  Prosecution must also prove beyond reasonable doubt the defendant had reasonable grounds to believe that the monies, funds in whole or in part directly or indirectly represented any person’s proceeds of a indictable offence.  Thus the defendant must be proved to have had grounds for such a belief and those grounds must be reasonable.  That is anyone looking at those grounds objectively would so believe.  Personal belief perception or prejudice of the defendant should be taken into account when determining the facts of the circumstances known to her.

17.  In fact the test for reasonable grounds to believe can be seen formulated in the case of HKSAR v Harjani Haresh Murlidhar [2019] 22 HKCFAR 446 stated in the following terms.  Firstly, what facts or circumstances including those personal to the defendant were known to the defendant that may have affected their belief as to whether the property was the proceeds of crime and secondly, would any reasonable person who share the defendant’s knowledge be bound to believe that the property was the proceeds of crime.  It is said that if the answer to question two is yes, the defendant is guilty, if no, then the defendant is not guilty.

18.  My resolution of the issue is as follows:

Prosecution submission was that as the entire prosecution case is admitted by the defence, then the only remaining contentious issue was the account given by the defendant which they submitted for a number of reasons should be rejected. The defendant established she was born in Hong Kong, speak Cantonese, English and Tagalog. She had worked in food and beverage and entertainment. She was educated to Form 5 level in Hong Kong. The basic facts that the Bank of China account were agreed and was as follows: The defendant opened the suspect account in 2011 when she worked at Players, Wan Chai. After she left them in 2012 she had little need for the account as the primary account was with Hang Seng Bank. She said she barely used the BOC account thereafter. The account had both ATM and internet banking. The user name, password and ATM PIN were attached on a small piece of paper to the ATM card and kept in her handbag.

19.  It is confirmed the defendant reported the card lost on 28 October 2021.  It is confirmed that the defendant went to the BOC branch on 4 November 2021 and deposited HK$50 into the account to pay the replacement fee of the ATM card.  The defendant orally provided an address which were recorded as a different address from both that on her bank record and that refer to by her in her record of interview.

20.  There is no record relating to the issue of replacement card for the account or whether the replacement card for the account was collected in person or sent by post.  In fact it would appear all transactions of the account that the court is dealing with could have been performed by internet banking.  All the withdrawals for the accounts were electronic.  Any payments to the account would need only the bank account number and the ATM card and its PIN number would not be required.  The account was closed by the bank in December 2021.

21.  My finding of facts is that the defendant’s account of handling of the account around the relevant period is not truthful, credible and not capable of belief.  In her initial evidence the defendant mentioned writing the user name and password on the paper on the reverse of the ATM card.  She did not at that stage add the presence of the ATM card number until later in her evidence.  In fact, this part of her evidence appears to me to be a creation of a narrative to explain how the account could have been used and the security details could have been accessed.

22.  What is contradictory is that after supposedly losing the password and the user name together with the card, she simply did not reset the password or instruct the bank to freeze the whole account or inform the bank of the loss of this important security information. Defendant’s explanation for this was that the bank told her the account was frozen, that is not supported by the Agreed Facts, that only the use of the ATM card reported missing was frozen.

23.  The defendant is not unintelligent.  She was perfectly aware of the distinction between freezing the account in total or simply freezing the operation of the missing ATM card.  The defendant’s evidence she was told something that it was not the bank’s practice is telling and appears to be a fabrication created by her to give a reason not to immediately reset the account password.

24.  Furthermore, despite taking measures to report the card missing and obtain replacement, she makes no inquiries about the account when the card is not delivered to her and the account is later closed by the bank.  Defendant remained throughout the period in possession of the means to operate the account.  Overall, I did not find the defendant’s account to be credible or reliable and I rejected it in its entirety.

25.  I was then simply left with the evidence for the prosecution.  This shows the defendant was in control of the BOC account throughout the period during which the sum of over $2.5 million were received into the account on the relevant days.  The account transaction pattern showed 15 deposits and 51 withdrawals within the period.  Deposits totalling over $2.5 million and withdrawals of a similar sum over a period of two days.

26.  The defendant argued with me and showed no basis by which she gave lawfully access such funds.  The account shows clear hallmarks of money laundering and is consistent with the temporary depository of funds.  It is proved beyond reasonable doubt that any person with the defendant’s knowledge looking at the circumstances, transaction pattern of the account would be bound to believe the funds deposited into the account on the relevant days shown in the charge directly or indirectly represented the proceeds of indictable offence.

27.  All elements, the defendant had reasonable grounds to believe these funds were the proceeds of crime.  All element of the offence were made out by the evidence that I find appropriate on reasonable doubt and the defendant is accordingly convicted of the offence.