HKSAR v. SUM SIU NGO

DCCC 782/2022

[2024] HKDC 2138

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 782 OF 2022

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REASONS FOR VERDICT

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1.  There are 2 Defendants in the present case, D1 faced Charge 1 and the two key Prosecution witnesses have declined to attend court to testify against D1 as Zhou lives in Mainland China while the other witness has emigrated to Australia.

2.  For that reason, the Prosecution offered no evidence against D1.  Charge 1 against D1 is therefore dismissed for want of prosecution.

3.  D2 (“the Defendant”)  also faced a single charge.  He pleaded not guilty to Charge 2 of money laundering.  The particular of the charge is as follows:-

“on 8 November 2016, in Hong Kong, D2 together with Ng Pan, knowing or having reasonable grounds to believe that property, namely, the sum of US$206,190.00, in whole or in part directly or indirectly represented any person‘s proceeds of an indictable offence, dealt with the said property.”

4.  There are 2 sets of Admitted facts:-

5.  The 1^st admitted facts also stated the background of the case and there are undisputed facts:-

(a)  Zhou Xi is a Mainland resident, she has an account with HSBC since early 2015.

(b)  Sampson Wong also has a personal account with HSBC.

(c)  Wong engaged the services of money exchange from Yip Hing RMB exchange shop for exchanging RMB into Hong Kong dollar through a middleman, Chan Sin Cheung (“PW2”).

6.  On 8^th November, at about 9 am, PW1 received a call from a male and his number was 9232 6512.  That male requested for exchange of HK$1.6 million into USD currency.  After negotiating an acceptable rate with PW2, PW2 provided Sampson Wong’s account detail to PW1.

7.  PW1 then requested that male to make payment of HK$1.6 million into Sampson Wong’s account.

8.  On 8 November, 2016, Zhou transferred HK$1.6 million from her HSBC account into Sampson Wong’s HSBC account (the transfer slip was marked as P10).

9.  At about 1:45 pm on the same day, Ng Pan and D2 attended Yip Hing currency exchange shop.

10.  D2 produced:-

(a)  his HKID card;

(b)  2 copies of address proof;

(c)  the transaction advice.

11.  After confirming with PW2 that the HK$1.6 million has been deposited into Sampson Wong’s account, PW1 then released the US$206,190 in cash to Ng Pan and D2.

12.  Ng Pan took away the USD money in a brown envelope.

13.  During the whole process, Ng Pan did not reveal his identity and all the information requested was provided by D2.

14.  D2 was arrested on 4 January 2017.  The two original address proofs (P11 and P12)  were found during the house search at his home.

15.  PW1 positively identified Ng Pan and D2 in an identification parade held on 16 January 2017.

16.  On 4 January 2017, D2 attended a video recorded interview.  The VRI (P13)  was made voluntarily by D2.  English transcripts is P13b.

17.  D2 has a clear record in Hong Kong.

18.  The 2^nd set:-

19.  It covers the reason why Charge 1 was dismissed.

20.  Ng Pan was arrested on 15 December 2016, but he had absconded.

21.  It mainly concerns with the working experience of Ng Pan that:-

(a)  Between April 2015 to February 2016, Ng Pan worked in HSBC as associate relationship manager;

(b)  Between June 2016 to February 2017, Ng Pan worked as a relationship manger in Standard Charter Bank.

22.  From the admitted facts, it tells me the reason why Ng Pan was not charged as he had been absconded since he participated in the ID parade in January 2017.

23.  Undisputed facts:-

(a)  the Defendant attended the shop with Ng Pan as evidenced by the CCTV footage from PW1‘s shop;

(b)  as such, the identity of the Defendant was not in dispute;

(c)  the total amount of the USD being withdrawn on 8 November 2016.

In the Prosecution case

24.  There are 3 witnesses:

(i)  PW1 is the witness to say that on 8 November 2016, the Defendant came with Ng Pan to the shop to withdrew the USD as stated in the charge;

(ii)  PW2 confirmed that his customer was Sampson Wong. He had RMB currency that he would like to change it into Hong Kong currency. PW2 contacted PW1 for such services and provided Sampson Wong’s account number to PW1. On 8 November 2016, PW2 received a confirmation of the HK$1.6 million deposit (P10)  into Sampson Wong’s account.

(iii)  PW3 was the arresting officer of the Defendant on 4 January 2017. He arrested the Defendant for an offence of conspiracy to defraud. The Defendant said under caution that it had nothing to do with him. PW3’s evidence was not challenged by the defence.

The Defence case

25.  The Defendant elected to give evidence.  His evidence was mainly regarding his trust on Ng Pan for various reason.  Two months prior to the date in question, he received a call from Ng Pan to help him to withdraw money.  He had no suspicious in the transaction.

Analysis of evidence

26.  When I assessed all the evidence before me, I bear in mind that it was the duty of the Prosecution to prove the case beyond all reasonable doubt.  The Defendant has no duty to prove his innocence.

27.  The Defendant has a clear record and I direct myself as to his propensity to commit any offence is low and his credibility in giving evidence should be enhanced.

28.  If anything from the evidence that the Defendant said was true, he is entitled to an acquittal.

Section 25 of OSCO

29.  Monies passing through a bank account are property as defined in S 2, OSCO and also when read in conjunction of the definition of “property” in s 3, the Interpretation and General Clauses Ordinance, Cap  1.

30.  The actus reus of an offence under s 25, OSCO is “dealing” with property.  “Dealing” in relation to property is defined in s 2(1)  of the Ordinance and it includes (insofar as it is relevant to the present case):-

“(a)  receiving or acquiring the property;

……

(c)  disposing of or converting the property.

(d)  ……”

31.  In the present case, from the Prosecution’s submission, they do not rely on the “knowledge” limb, but rather on the limb of “reasonable ground”.  What amount to reasonable is objectively viewed.

32.  The Defence accepted that the Prosecution does not need to proof the predicated offence.

33.  As to the test for determining whether an accused had “reasonable grounds to believe”, in Carson Yeung’s case the court confirmed the earlier decision in HKSAR v Pan Hung Fai (2014)  17 HKCFAR 98 that the test is:-

“To convict, the jury had to find that the accused had grounds for believing; and there was the additional requirement that the grounds must be reasonable: That is, that anyone looking at those grounds objectively would so believe.”

34.  Moreover, in deciding whether a Defendant had reasonable grounds to believe, the applicable standard is whether on the grounds available to him, the accused would have been led to have the requisite belief.  In determining this, the Defendant’s beliefs, perceptions or prejudices are to be considered and given such weight as is warranted.  The conclusion which a court reaches on the issue of whether a Defendant had the relevant reasonable grounds to believe depends on the state of the evidence.

35.  In HKSAR v Harjani Haresh Murlidhar[2019] 22 HKCFAR 446 stated the following steps:-

“(i)  What facts or circumstances, including those personal to the defendant, were known to the defendant that may have affected his belief as to whether the property was the proceeds of crime (“tainted”);

(ii)  Would any reasonable person who shared the defendant’s knowledge be bound to believe that the property was tainted?”

36.  The court also added that the first issue that the judge must address is, what matters the Defendant know of that might have affected his belief as to whether the property was clean or tainted. Where the Defendant gives evidence of facts and matters that affected his belief about the nature of the property the court has to decide whether he is or may be telling the truth about the existence of those matters.

37.  The second issue is whether any reasonable person who shared the Defendant’s knowledge would have been bound to believe that the property was tainted.  Furthermore, where the Defendant does not give or adduce evidence, the court has first to find what relevant facts or circumstances would have led any reasonable person to believe that the property in question was tainted.

The relationship between Ng Pan and the Defendant

38.  The Defendant left school in 2012, he was aged 20 then.  He met Ng Pan in a bar, which was owned by Ng Pan.

39.  He frequented there about 4 to 5 times a week.  On 7 to 8 occasions, he worked part-time in Ng Pan’s bar from 6 pm to 4 am and received $500 each time.

40.  The Defendant did not have any job at that time.  He considered that No Pan had provided assistance to help him.

41.  As the Defendant eventually found himself a job, he visited the bar less often.

42.  Nonetheless, the Defendant remained in contact with Ng Pan occasionally for meals even thought his visit to Ng’s bar became less frequent when he worked in Silver Express in 2016.

43.  Since the present incident, it seems that the Defendant was not in contact with Ng Pan anymore except a month after this incident, Ng Pan asked him to go out for meal, but that was declined.

The September phone call

44.  According to what he said in the record of interview, two months prior to the exchange shop incident, the Defendant received a phone call from Ng Pan:-

(a)  Whether the Defendant would be interested in the investment migration business or not (Counter 26 and 48).

(b)  The Defendant needed to provide his ID card and address proof to get money from the exchange shop (Counter 26 and 48).

(c)  D2 would be remunerated by a 2% for his help (Counter 144).

The reasons why the Defendant offered his help to Ng Pan

45.  The Defendant said that:-

(a)  Ng Pan worked in a Bank.

(b)  He owned a bar (as such , the Defendant believed that Ng Pan was a rich man).

(c)  He was well-groomed, also in a suit.

(d)  Ng Pan was well- connected, he introduced a social influencer (Tat Kor)  to the Defendant, they also took a picture inside the bar (although the Defendant looked up to Ng Pan as a successful young achiever, he never took a picture with him).

(e)  Ng Pan helped him when he dropped out from school by offering him a partime job in his bar.

(f)  In conclusion, the Defendant believed that there was no reasons for Ng Pan to deceive him.

46.  Be that as it may, the Defendant had not contact Ng Pan for a while before the September phone call.  Circumstances might have changed during this period of this time.

Why did Ng Pan needed the Defendant to help him?

47.  On the face of the Defendant’s evidence, the Defendant did wonder why Ng Pan could not do it himself, that was obvious to the Defendant that Ng Pan should have his own ID card and address proof (Ng Pan worked in Hong Kong).  These are simple documents to be provided.  Ng Pan would have asked his family members or others to help.  Why it has to be the Defendant?

48.  The explanation given by Ng were as followed:-

(a)  He just moved to another place.

(b)  He did not want his colleagues to compete with him.

49.  We have not heard evidence in what way that would compete with Ng Pan’s colleagues.

50.  The incident occurred in November 2016.  The phone call was 2 months (September 2016)  ago.

51.  The enquiry by the Defendant was at the September 2016 phone call.  He did not make any further enquiry in November 2016 when Ng Pan called him again.

52.  The Defendant did not make enquiry as to when and where did he move to.

53.  That means by November 2016, Ng Pan should have new address proof especially Ng Pan worked in HSBC then.  Ng had plenty of time to update his address with the Bank.  It would be easy for him to send a letter from the Bank to his new address within days, not 2 months.

54.  What the Defendant said in Court was different from his version in the record of interview:-

(a)  He explained why he helped Ng because Ng asked him in the September phone call “directly if I was interested in doing it.” (Counter 143-152 ). “he told me that, like, er, was (I)  inter(ested in)  - that I assisted others in investment migration , and then just to go and get money at a money changer. It was as simple as that.” (Counter 48)

(b)  he also said that he “played the role of withdrawing the money, because I don‘t know - that is, what you’ve mentioned regarding so many people.” (Counter 24)

55.  That means the Defendant had an interest in doing it because there was a monetary reward of 2% to the Defendant (Counter 144).

56.  In another word, if Ng Pan provided his own ID card and address proof, it saved him 2% reward to the Defendant.

57.  For the Defendant agreed to produce the ID card and address proof, he would get 2% reward. 

2% reward

58.  That brings us to the topic of the 2%.

59.  The Defendant said that there was no discussion between him and Ng as to what was the 2% reward stand for.  He did not know what was the actual amount would be.  He did not receive any remuneration from Ng Pan.  He did not ask Ng Pan for the 2%.

60.  In the Defendant’s mind, he just wanted to help Ng Pan.  He was grateful for Ng Pan to provide work for him when he dropped out from school.

61.  The Defendant knew that on the way to the currency exchange shop the amount to be withdraw was about US$205,000 (Counter 94-105)  and his role was to withdraw money from the shop (Counter 24).

62.  This was the first time that the Defendant ever went to an exchange shop to withdraw money, not to mention such a large sum and in US currency.  By all standard, it was a huge sum of money to the Defendant, especially when he could earn only $500 per day back then in Ng Pan’s bar.

63.  Ng Pan offered 2% as reward was a motivation for the Defendant to produce his ID card and address proof to withdraw that amount of money from the shop.

64.  In fact, there was a huge risk involved in that transaction.

65.  In that transaction, Ng Pan never produced his ID card and the Defendant provided all the information requested by PW1.

66.  In Hong Kong, we all know the importance of the information contained in our ID card.  We all have to go to the Immigration Department to fill in information to get new ID cards in recent years.  All residents have to carry the ID card in person.

67.  The information in the ID card allow at least the Immigration Department and the police to identify that person who produce his/her ID card.

68.  To produce address proof means the location of a person live.

69.  If anything happened, the Defendant could not get away from it, he could be located easily.

70.  The Defendant himself knew of such risk.  When he was in the shop, he looked at the ceiling of the shop where the camera was installed.

71.  Same as Ng Pan.

72.  Why they needed to look at the camera?  If it was just a normal transaction?  Surely, at least the Defendant knew a recording camera would capture his face and the process of the transaction.

73.  The Defence emphasized that at the time of this incident, the Defendant was only 20 years and he has dyslexia.  It is common knowledge that Dyslexia only affects one’s learning ability in accurate spelling and reading, it does not affect his ability to judge the circumstances of the case.

74.  At the age of 20, it is not an age of extreme youth.  From 2014 to the time of the present offence in November 2016, he had work experience in Cathay Pacific and Silver Express as go down worker.  At least, Cathay Pacific is a big organization with big numbers of employees and different departments.

75.  The whole purpose of going to the shop with Ng Pan was to play his role to withdraw money and get pay by Ng Pan.

76.  That explained when Ng Pan called him to go Central from Wong Tai Sin, he has to rush there (one can see that he was sweating at counter 3 of the shop)  as he was expecting a 2% remuneration.

77.  One has to remember that the Defendant and Ng Pan took a taxi after they left the shop.  Why the Defendant has to share a taxi with Ng Pan when they lived in two different districts.  The Defendant lived in Tze Wan Shan while Ng Pan lived in Hunghom.

78.  One would ask what did they do in the taxi?  Taking the 2% of the remuneration cash from Ng Pan from the brown envelop?

79.  I refuse to accept the assertion by the Defendant that in his mind was only to assist Ng Pan.

80.  It simply was not convincing that they did not discuss the amount of the 2% or the Defendant did not make enquiry of the 2% remuneration.

81.  I ruled that any reasonable man would come to the only irresistible inference that when the Defendant went to the shop with Ng Pan, he knew the 2% remuneration was in relation to the money that they withdrew from the shop.  And he expected that 2% to be immediately paid to him.

The insurance policy and migration investment

82.  On one hand, the Defendant said that Ng Pan told him it was a migration investment.

83.  While PW1 said that, he was told that HK$1.6 million was to pay an insurance premium.

84.  It was the duty of PW1 to know the purpose of withdrawing/exchange any sum of money over HK$120,000 as required by the government.

85.  In their previous phone calls, PW1 learnt from Ng Pan that it was his relative in China needed the money to buy an insurance policy.

86.  PW1 also learnt that from the news it was common for the Mainlander to use Union Pay to pay the premium of the insurance policy.  However, there was a quota for it.

87.  When the Defendant and Ng Pan came to the shop, he did not ask whether he was a Mainlander or the relative of Ng Pan because he considered that it was rude and impolite to do so.

88.  PW1 had seen customers coming to the shop were Mainlander, but possessed HK ID card.  He did not find it unusual.  There was no need for him to investigate the status of the Defendant who produced his ID card.

89.  PW1 looked at the Defendant as a customer and Ng Pan as an insurance agent.

90.  The Defence seems to shift the blame on PW1 that he did not do enough of his due diligent check.  If he did, and found the situation suspicious then he would not go ahead of the transaction.

91.  PW1 was not a party in this money laundering activities.  Yip Hing was a family business.  His parents owned the business.  He worked in this business just for 8 months and followed what the shop needed to know.  He did not find anything arouse his suspicion at the material time.

92.  While the Defendant himself, he just heard the general term of “migration investment” from Ng Pan and his role was to withdrew money.  That was all the information he got from Ng Pan (Counter 177-184).

93.  The Defendant did not know anything in details; he did not even know which country for such investment.  He did not make further enquiry about it.

94.  It was purely because Ng Pan worked in a Bank, he then believed that it was related to Ng Pan’s job.  Did he actually know the nature of his job?  Had he ever make enquiry about it from Ng Pan?

95.  One would question this believe as Ng Pan worked in a well-established Bank, be that HSBC or Hang Seng , why Ng Pan would go to the exchange shop to get the money?

96.  After they received the money from the shop, they immediately took a taxi to Hunghom where Ng Pan lived.

97.  If that was related to Ng Pan’s job, surely Ng Pan had to return to the Bank.  Both the shop and the place Ng Pan worked were located in Central.  Why went home instead with such a large sum of money in USD currency?  Bearing in mind that the Defendant knew that Ng Pan has to send the money to his client for migration investment (Counter 108 and 178).  Shouldn’t it be more convenient and direct to do in the Bank?  Rather than going back home in Hunghom?

98.  The Defendant still believe that the money transaction in the shop was for migration investment?  The answer is clear to me that any reasonable person would say that those were tainted property.

At Counter 3

99.  This is a very small area, on one side of the counter; it has a tiny space for 2 persons to stand at the counter inside the shop facing the customer side with a glass partition in the middle.

100.  While at the customer side, it only allows 2 persons to stand at the counter.  At the material time, the Defendant and Ng Pan were standing side by side facing PW1 who was inside the shop.

101.  The Defendant said that he did not pay any attention to what was said between PW1 and Ng Pan.

102.  During cross examination, the Defendant said that he did not hear about the topic of “insurance premium payment” or “migration investment”.

103.  It is clear from PW1 that the content of the conversation between himself and Ng Pan was about:-

(a)  The exchange rate;

(b)  The purpose/motive of withdrawing the USD money;

(c)  To produce the documents.

104.  From the CCTV, it was the Defendant produced the ID card and documents (P11 and P12 - address proof)  at the counter.

105.  At the counter, Ng Pan still maintained his version to PW1 that the purpose of withdrawing the money was for “paying an insurance premium”

106.  As a rule of thumb, the shop needed to know why cash was needed.

107.  I believe what PW1 said in Court that at the counter, Ng Pan told him the purpose of changing the HK$1.6 million into USD currency was for insurance premium.

108.  The Defendant was there to withdraw money, he had produced his ID card and documents as requested, and it sounds strange that his mind suddenly becoming blank and did not pay attention to their conversation.

109.  I reject the Defendant’s assertion that “his mind became blank” at that time.  He stood next to Ng Pan, he heard what he told PW1 about the “insurance premium payment”.

110.  When it is established that the Defendant had heard the conversation of “payment of insurance premium”.

111.  The question follows: - wouldn’t it alert the Defendant that something became dubious as to the transaction?

112.  Any properly direct jury would say “yes” to it.  Why did the Defendant fail to make enquiry for such a change of purpose?  Obviously, he was part of the scheme and his role was to withdraw money with a 2% remuneration.

P10 - the deposit slip of HK$1.6 million

113.  According to PW1, once the HK$1.6 million was deposited into Sampson Wong’s account, then he would release the USD to the Defendant and Ng Pan.

114.  From the CCTV, we can all see that PW1’s father passed the deposit slip (P10)  to PW1 just before Ng Pan and the Defendant turned up at Counter 3 of the shop.

115.  It was essential for PW1 to confirm that the HK$1.6 million had been deposited into Samson Wong’s account before he could release money to the Defendant and Ng Pan.

116.  PW1 said that there were 3 counters in the shop.  Customers would go to Counter 1 first, then proceeded to Counter 3.

117.  PW1 was sure that it was both the Defendant and Ng Pan to produce the deposit slip to the shop.

118.  In the record of interview, the Defendant was aware of the deposit slip (P10)  as he knew that with the production of the deposit slip, then money could be withdrew (Counter 74 and 88).

119.  Clearly, without money being deposited, the shop would not release money to them.

Why it was the Defendant to withdraw money, not Ng Pan?

120.  The Defendant said in the record of interview “he never thought about it” (Counter 113-114).

121.  That means he never thought about the reason why Ng Pan did not do it himself even though the two of them went to the money changing shop together.

122.  As said before, if Ng Pan collected the money himself that could save him 2% remuneration.  Why would he be bothered to give away 2% as remuneration.

123.  It still did not occur to the Defendant that something was suspicious about the transaction?

Conclusion

124.  I accepted all the prosecution witnesses’ evidence as true and reliable.

125.  I rejected the Defendant’s claim that he believed that the money was for migration investigation as told by Ng Pan.  I also do not attach weight to any part of his assertions in the record of interview that he did not know what the 2% represent.  I attached weight to his admission about his knowledge of the transaction and the role he played in this scheme.

126.  To this end, having taking all the information in consideration, the prosecution has proved beyond all reasonable doubt that the Defendant, in his belief, that the money transaction taken place in the shop was tainted.  Any reasonable person in his position sharing his knowledge would be bound to come to same conclusion that the property was the proceeds of a crime.

127.  The Defendant is convicted as charged.