HKSAR v. HAU LOK MAN AND ANOTHER

DCCC 881/2023

[2024] HKDC 1554

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 881 OF 2023

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REASONS FOR SENTENCE

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Charges

1.  D1 and D2 were jointly charged with one count of conspiracy to defraud, contrary to Common Law and punishable under section 159C(6)  of the Crimes Ordinance (“Charge 1”)  and an alternative count of attempting to deal with property known or believed to represent proceeds of an indictable offence, contrary to section 25(1)  and (3)  of the Organized and Serious Crimes Ordinance (“the Ordinance”)  and sections 159G and 159J of the Crimes Ordinance (“Charge 2”).

2.  The particulars of offence of Charge 1 alleged that on 27 April 2023, D1 and D2 conspired together with other person(s)  unknown to defraud CHAN Kwok-Hoi (“Mr CHAN”)  by dishonestly falsely representing that Mr CHAN ’s son was in need of money, thereby to induce Mr CHAN to part with a total sum of HK$200,000.

3.  The particulars of offence of Charge 2 alleged that on the same day, D1 and D2, together with other persons unknown, knowing or have reasonable grounds to believe that property, namely, a sum of HK$200,000 in cash, in whole or in part, directly or indirectly, represented any person’s proceeds of an indictable offence, attempted to deal with the said property.

4.  D2 pleaded guilty to Charge 2 which was accepted by the prosecution.

5.  D1 pleaded not guilty to both charges.

6.  D1 was convicted after trial on Charge 1.

The Facts

7.  The facts agreed by D2 revealed that: the case originated from a telephone scam with one Mr CHAN (“Mr CHAN”)  being the person deceived. On 26 April 2023, Mr CHAN received a phone call from an unknown male (“the Unknown Male”)  who purported to be Mr CHAN’s son and claimed that he had bought a new phone and wanted to test the phone.

8.  On 27 April 2023, the Unknown Male called Mr CHAN again and claimed that he had been involved in a fight and had been arrested, and required HK$200,000 to compensate the victim.  Mr CHAN felt suspicious.  He made a call to his son and found out it was a scam.  The case was reported to the police and a controlled meeting was mounted by the police.

9.  The Unknown Male further called Mr CHAN and told him to meet his friend “Ming Jai”, outside a supermarket at Lok Tak Court, who will approach Mr CHAN for collecting the cash.  Mr. CHAN received yet a further call in which a male who claimed to be “Ming Jai” and said that he had arrived at Lo Tak Court.  The male asked for Mr CHAN’s attire, and Mr CHAN replied accordingly. Subsequently, D2 and D1 arrived at Lo Tak Court in a taxi.  They departed in separate ways upon a short conversation after getting off the taxi.  D2 then acted as a lookout. Subsequently, D1 approached Mr CHAN and claimed to be "Ming Jai" and that he was there to collect the money from Mr CHAN.

10.  The operation then turned overt and D2 and D1 were both arrested.

11.  Under caution upon arrest, D2 stated that someone called him on the same day and asked him to collect money with another person.

12.  In a video cautioned interview, D2 stated, inter alia, the following:

(a)  On 15 April 2023, he acquainted with a person online, alias “MAFIA”, via an online video game. “MAFIA” recruited him for a job and he therefore passed his telegram account to “MAFIA”;

(b)  On 25 April 2023, a telegram account bearing the name of “Bobby” contacted him via telegram and asked him to act as a lookout while another person collected some money;

(c)  In the morning on 27 April 2023, “Bobby” contacted him via telegram and asked him to meet another person in Mong Kok, then take a taxi to Tsuen Wan and act as a lookout during D1’s collection of the money from Mr CHAN. He complied and acted as a lookout during the process; and

(d)  He believed that the money involved represented proceeds of a scam. He was not acquainted with Mr CHAN and he did not know how the money would be dealt with after the money was collected.

13.  With regard to the facts found by this court leading up to the conviction of D1 re Charge 1, they were dealt with in the Statement of Findings and the same would not be regurgitate here.  In gist it was found by this court that D1 had agreed to collect money for a person called “Yin”, a complete stranger to D1, in return of monetary reward.  D1 further adhered to the instructions given to him to approach Mr CHAN by claiming himself to be “Ming Chai”, which was not the name of D1. The act of D1 was fraudulent.  The totality of the evidence suggests that D1 was a party to the conspiracy.

Prosecution’s Application for Enhancement of Sentence

14.  The prosecution has applied for an enhanced sentence pursuant to section 27(2)(c), (d)  and (e)  of the Ordinance on the basis of prevalence; the nature and extent of harm caused to the community; and the nature and extent of the total benefit gained by anyone from the present offences.

15.  The prosecution prayed-in-aid the Statement of Detective Chief Inspector Tang Kai Wing dated 29 February 2024.  According to Detective Chief Inspector Tang, a common modus operandi of telephone deception is “By Hand” “Guess Who” telephone deception.  “By Hand” modus operandi is where culprits would instruct victims to attend a specific place and hand over cash to other culprits directly.  “Guess Who” refers to deception by pretending to be a family member, colleague, friend or acquaintance of victim and asking for ‘money’ in urgency. Parties agree that “By Hand” and “Guess Who” deception relate to the present case.  The relevant statistics revealed an upward trend of “Guess Who” telephone deception since 2018, with a sharp increase from 497 case in 2021 to 1540 cases in 2022 and rose to 2,237 cases in 2023.  In 2023, the accumulated monetary loss of “By Hand” “Guess Who” telephone fraud exceeded HK$139 millions.

16.  Both D1 and D2 did not object to the application for enhancement.

Background and Mitigation of D1

17.  D1 is now aged 16 (he was 15 at the time of commission of offence).  He is single and lives with his mother.  He was pursuing a hairdressing vocational training prior to conviction.

18.  The defence accepted that he has a criminal record which was dissimilar in nature and unrelated to present charge in which he was sentenced to 120 hours of community service order.

19.  With regard to the tariff for phone deception cases, the defence cited HKSAR v Hung Yung Chun [2011] 2 HKLRD 174 and pointed out that the general starting point to be one of 4 years’ imprisonment.

20.  In mitigation, Mr Ryan Chan on behalf of D1 submitted that: D1 played a very minor role in the entire fraudulent enterprise; he had no actual involvement in deceiving the victim; he was taken advantage of by the principal fraudsters such as Yin, who had successfully shielded herself from the legal consequences of the fraud; he had been duped into being the foot soldier of the person(s)  in orchestrating the fraud; the offence was committed as a result of a momentary lapse of judgment on the part of D1 where he failed to appreciate the seriousness of the act he was asked to undertake; the amount of money involved was relatively small; there was no actual loss or harm caused to Mr CHAN; and  the two different periods that D1 spent in custody effectively meant that he had already heard the clang of the prison gate twice.

21.  Mitigation letters from D1’s parents, D1’s cousin and Vice-Principal of Fung Kai Liu Man Shek Tong Secondary School were submitted.

22.  Prior to sentence, Mr Ryan Chan urged this court to obtain a Community Service Order report for D1.  The report indicated that D1 is not to be regarded as a suitable candidate to perform Community Service order due to his poor performance in the previous order and thus the same was not recommended by the probation officer.

Background and Mitigation of D2

23.  D2 is 23 years old and was born and raised in Hong Kong.  He was 21 years old at the time of the offence.  He resides with his father, stepmother, grandparents and his 2 brothers.  He started working as a construction worker after completing Form 4.  Prior to his company ceasing operations, he earned approximately HK$10,000 per month.

24.  As to the reasons for committing the offence in question, Ms Lam who represented D2, told this court that just shortly before the offence, D2 became unemployed and failed to find any alternative employment due to the ongoing pandemic at the time, his low education level and limited work experience.  It was during such financial crisis that he was taken advantage of by others and mistakenly agreed to participate in the present offence.  The present offence was therefore prompted by D2’s momentary greed in wanting to earn some quick money.

25.  As for mitigation of D2, Ms Lam submitted that, D2 is of clear record and was only 21 years of age at the time of the offence.

26.  There is no evidence showing that D2 knew about the details of the predicate offence, ie the phone scam. D2 was merely a courier and had committed the offence in return for a small sum of money.  Mr CHAN did not suffer any financial losses and there is no evidence that he suffered any intense fear/threat during the phone scam. The present case also involved no international element.

27.  D2’s mitigation letter was also submitted.  Ms Lam submitted that the contents of which reflect the genuine remorse, regret, and determination to change on the part of D2. It was further submitted that the present offence was an out of character incident and the risk of D2 repeating the same is very low.

28.  Insofar as the starting point of sentence is concerned, the defence referred to HKSAR v Cen Huakuo [2015] 2 HKLRD 951 and HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545 and urged this court to adopt a starting point of no more than 2 ½ years.

29.  As to the prosecution’s application for enhancement, Ms Lam indicated that there is no objection by D2.

30.  As to the extent of the enhancement, the defence however invited the court to consider the past decisions of the District Court in HKSAR v Cheung Ka Chun & Anor [2024] HKDC 788 and 香港特別行政區 訴 余志良, unrep. (DCCC 558/2016)  as examples and urged for an enhancement of no more than 25%.

Sentence

31.  Charge 1 of conspiracy to defraud and Charge 2 of Attempting to deal with property known or believed to represent proceeds of an indictable offence are both regarded as specific offences under the Ordinance, and thus section 27(2)  of the Ordinance applies.  Based on the statistics provided, I am satisfied beyond reasonable doubt, given the prevalence and the nature and extent of harm caused to the community by recent occurrences of this type of telephone deception, that the court should pass a sentence that is more severe than the sentence it would otherwise has passed.  I am of the view that a 25% enhancement is appropriate for D1 in Charge 1 and D2 in Charge 2.

32.  Insofar as D1 re Charge 1 is concerned, I accept there is no evidence showing that he knew about the details of the phone scams.  I therefore accept that his culpability is less than that of the perpetrator(s)  of the underlying phone deception.  However, D1 did take part in the actual collection of money and pretended to be someone whom he was not in the course of collecting money from Mr CHAN.

33.  In determining the proper starting point for Charge 1, I have reminded myself of the sentencing principles laid down in Hung Yung Chun (supra) in which the Court of Appeal stated that a phone deception case is more serious than a common street deception case and the general starting point for a phone deception case should be one of 4 years’ imprisonment.

34.  For D1 re Charge 1, I adopt a starting point of 4 years' imprisonment.  I see no other mitigating factors which warrant any further reduction.  With the 25% enhancement, I sentence D1 to 5 years’ imprisonment for Charge 1.

35.  I make no order re Charge 2 for D1.

36.  Insofar as D2 re Charge 2 is concerned, I have reminded myself of the sentencing principles laid down in Cen Huakuo (supra).  I have also borne in mind the amount of money involved, the duration of the offence, D2's role in relation to the movements of funds as well as his personal circumstances.  I accept there is no evidence showing that he knew about the details of the phone scams.  I therefore accept that his culpability is less than that of the perpetrator(s)  of the underlying phone deception.

37.  For D2 re Charge 2, I adopt a starting point of 2½ years' imprisonment.  With his guilty plea, the sentence is reduced to 20 months.  I see no other mitigating factors which warrant any further reduction.  With the 25% enhancement, I sentence D2 to 25 months' imprisonment for Charge 2.

38.  I make no order re Charge 1 for D2.