HKSAR v. LEUNG SIU CHEONG

CACC 104/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 104 OF 2003

(ON APPEAL FROM DCCC NO. 1163 OF 2002)

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J U D G M E N T

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Hon Stock JA (giving the judgment of the Court):

1. This is an application for leave to appeal against sentence. On 24 February 2003 the applicant was convicted after trial before HH Judge Christie in the District Court of an offence of conspiracy to defraud and he was sentenced to a term of four years' imprisonment. This was yet another of the false trading scams by which gullible and innocent members of the public are induced to part from savings in order to invest in non-existent trading funds.

2. On 28 August 2003 the court dismissed the applicant's application for leave to appeal against conviction. The material facts for present purposes are to be found in the following passages of that judgment:

"4. The object of the conspiracy was to defraud persons who responded to advertisements, placed on behalf of the company, offering office employment. The applicant's role in the conspiracy was to pose as the office manager (referred to as 'Manager Lam') and two of his co-conspirators (known as 'Ah Bee' and 'Ah Joe') were to pose as a newly employed member of staff and as an experienced and successful member of staff respectively.

5. Further the prosecution's case was that the conspirators engaged in various methods of gaining the confidence of those who responded to the advertisements before dishonestly inducing them to part with their money. Such methods included closeting the 'victim' in a room with 'Ah Bee'; pretending to him that the company was actually engaged in trading in gold and silver; demonstrating to him through 'Ah Joe' that profits could be made from such trade by staff members; persuading the 'victim' to open a so-called account and to part with his money; and then to accuse the 'victim' of incurring a liability to pay more money.

6. PW1 Madam Lam was one such 'victim'. She began working at the company on 8/9 February 2000. On that day she was met by 'Manager Lam'. On 15 February she paid 'Manager Lam' $120,000 in cash, and on the next day she paid him $100,000 believing that such sums were by way of investment. On 18 February PW1 was accused by 'Manager Lam' of making a trading mistake and he required her to make additional payments to protect her original investment. On 18/19, 23 and 24 February, PW1 made payments of $226,000, $150,000 and $50,000 respectively to 'Manager Lam'. Her total loss was $646,000.

7. Her evidence (inter alia) was that she saw 'Manager Lam' almost everyday whilst she was employed by the company, and sometimes several times a day; that it was 'Manager Lam' to whom she made her payments and it was he who handed receipts to her;"

3. The applicant is now aged 29 years and he was not before these offences a person of good character. In sentencing the applicant the judge, citing a number of authorities, remarked that the normal sentence for this kind of offence was one of four years' imprisonment, but he drew a distinction in the case of the applicant by pointing to the fact that the applicant had partaken in the defrauding of only one victim, so far as the evidence showed. There was, he said, "only one proved victim". For this reason he reduced the starting point to one of three years' imprisonment. But he then enhanced it back to four years' imprisonment by reason of the provisions of sections 27(2)(a) and (c) of the Organized and Serious Crimes Ordinance, Cap. 455.

4. As for subsection (c), prevalence, the judge said that there was evidence before him to the effect that whilst the actual detection of offences of this kind had reduced since 1999 there was, he said, reason to think that the offence was still prevalent and that detection was down because of a change in the way these scams were operated.

5. As for subsection (a), which addresses "the nature and extent of the harm caused directly or indirectly to any person by the act in respect of which the person has been so convicted", the judge relied on the nature and effect of the harm caused to this particular victim. She was a 60 year-old victim who suffered, as a result of this offence, severe psychological harm, and indeed had testified that she had been driven to the point of suicide. In consequence of utilizing these two arms of section 27, the judge enhanced the sentence to one of four years' imprisonment.

6. Mr Percy, who appears on behalf of the applicant, contends, in his able submissions, that as to the issue of prevalence, the judge erred in that by the date of the sentence it was common ground that the offence was no longer one that could properly be described as prevalent, and he cites a number of authorities in support of that proposition; in particular the cases of HKSAR v Chung Chi-king (CACC 504/2001 and CACC 361/2002, 4 March 2003), HKSAR v Tang Kwok-wing & Ors (CACC 253/2001, 12 June 2003) and HKSAR v Lin Yuet-ming (CACC 258/2003, 30 September 2003). The point is conceded by Ms Pang, who appears on behalf of the respondent.

7. On the question of harm to the victim, Mr Percy relies on the suggestion that harm to the victim is a factor taken into account in the four-year guideline for this type or line of offence and, in support of that proposition, he has referred us to HKSAR v Tang Kwok-wing & Ors CACC 253/2001 (12 June 2003, unreported). What was there said, at para 23 was this:

"23. Having considered all the prevailing circumstances which existed in this case, we have reached the conclusion that as this offence was, as Mr Lee has accepted, no longer 'prevalent' at the time of sentence, enhancement was inappropriate. It has to be remembered that the prosecution originally only sought enhancement on this basis. Furthermore, the four-year starting point, properly adopted by the judge on the first charge, would already have taken into account the deterrent effect such a sentence is intended to have. The way we expressed this in HKSAR v Wong Fung-ming (above) was as follows:

"44. The judge would have had in mind from this court's decision in Chiang Chun-wai (CACC 11/2001) that a sentence of four years' imprisonment was appropriate in itself to act as a deterrent for 'those who enter into heartless and cruel scams of this kind, and who are prepared to fleece gullible and blameless victims of as much of their hard-earned savings as they can lay their hands on'."

8. It is correct that the four-year guideline has regard to the effect on victims, but that is not to say that sentencing is a mathematical process blind to the particular case. Whether one examines it from the point of view that heartlessness and cruelty, or a particularly harsh impact, over and above the norm in such cases, cannot be ignored; or whether one asks whether the discount of one year from the starting point, which discount the judge gave in this case, was justified or excessive, given again the particular cruelty visited, and the particular effect upon, this elderly lady, the result is the same; which is that we think that the three-year sentence which Mr Percy would have us substitute is not in our judgment adequate. Indeed we go further and say that despite the identified error in the judge's approach in respect of prevalence, the sentence of four years' imprisonment if looked at on the basis of the facts of this particular offence, the substantial sum of money taken from this particular lady, and the particular effect upon her as proved in evidence, was not a sentence that was manifestly excessive. This 60 year-old lady, with little or no future earning power, we can safely assume, was fleeced day after day of a very substantial sum - indeed in the context of these cases an unusually large sum from one victim - and eventually driven to a condition which brought her to the edge of suicide. The fraud was practised on her between 9 February and 24 February and the applicant was still there when the police raided at the end of March. This was hardly a one-day operation. The applicant was at the heart of the particular fraud aimed at her, and he not only showed no shame at the time, but has shown not an ounce of remorse since.

9. Although we give leave to appeal out of time against sentence, and treat this as the hearing of the appeal, the appeal against sentence is dismissed.