HKSAR v, LEI HAIFENG

DCCC 641/2015

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 641 OF 2015

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REASONS FOR SENTENCE

1.  Lei Haifeng you have pleaded guilty to three charges of dealing with property knowing or believing the property represented the proceeds of an indictable offence and one charge of conspiracy to deal with property knowing or believing the property represented the proceeds of an indictable offence, contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance, Chapter 455 and sections 159A and 159C of the Crimes Ordinance, Chapter 200.

2.  Full particulars of the offences are set out in the facts admitted by you.  The four charges relate to telephone deceptions which took place on the 20 May and the 16, 17 and 18 June this year.  On each occasion the caller would falsely represent to the victim that their son was being detained and that money would need to be paid for their son’s release.   Two of the persons called were very elderly, aged 87 and 91. 

3.  The victims were told to take the money to a designated place where the money was handed over to you or left inside a flower pot for you to collect.  You were successful in obtaining HK$20,000 and RMB 19,000 on the first occasion and $8,700 and $20,000 on the second and third occasions. 

4.  On the fourth occasion Mr Li, aged 91, was telephoned at home by someone claiming that his son had been detained and demanded $230,000 for his release.  Mr Li said he had only $90,000 and was told to take the money to Cheung Sha Wan.  Mr Li realising this was a scam reported the matter to the police, who arranged for a dummy money bag to be given to Mr Li.   You were arrested when you approached Mr Li to collect the money.   

5.  In a series of video interviews you admitted collecting the money on each occasion. You told the police that about two months earlier a friend called Ah Kin had asked you if you wanted to make some money.  You agreed and came to Hong Kong during which time you were told to collect the money.  You then remitted the money to China.  In return you received a reward of $1,500; $900 and $1,600 in respect of the first three occasions.  At the time of your arrest you had not been notified the amount of your reward for collecting money from Mr Li.

Mitigation

6.  In passing sentence I take into account everything said on your behalf by Mr Cheung,including that you fully co-operated with the police.  I take into account that you have a clear record. This however carries little weight where the offender is a visitor to Hong Kong.  Further the courts have said that the commission of crime by visitors is an aggravating feature of sentence (see for example HKSAR v Aguilar Garcia Milner Javier CACC 485/2012).  

7.  Money laundering is a serious offence for which deterrent sentences are required.  A number of significant factors have been identified as relevant in determining the culpability of a defendant, including the nature of the predicate offence that generated the laundered money and the extent to which the offence assisted the crime or hindered its detection; whether the defendant had knowledge of that underlying offence or has turned a blind eye to the source of the money; the amount of money involved; whether there was an international element to the commission of the offence; the degree of sophistication of the offence and the level of the defendant's participation, including the length of time the offence lasted and the benefit he derived from the offence (see for example Secretary for Justice v Jerome Yuval Arnold Herzberg [2010] 1 HKLRD 502; HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545; and HKSAR v A male known as Boma Amaso [2012] 2 HKLRD 33).

8.  In HKSAR v Wu Jianbing [2012] 1 HKLRD 781 the applicant, who travelled from the Mainland, collected money on four occasions, over 4 days, resulting in four charges of money laundering.  The sums to be collected ranged from $20,000 – $200,000 and totalled altogether $310,000.  The Court of Appeal, taking into account there was no evidence to show that the applicant participated directly in the telephone deceptions (or was aware of the source of the money collected), held that the proper starting point after trial was 3 years on each charge.

9.  In HKSAR v Lin Zong Yue CACC 141/2014 the applicant, who also travelled from the Mainland, collected money on three occasions, resulting in three charges of money laundering.  The sums collected were $39,500; $30,000 and $75,000.  The Court of Appeal, finding that there was insufficient evidence to show that the applicant had knowledge the monies were from a telephone deception held that a starting point of 3 years could be adopted for both charges 1 and 2 which were committed on two consecutive days in September 2013 and 3 years and 3 months for charge 3 which was committed 53 days later. 

10.  Taking into account that the amount collected in May was HK$20,000 and RMB 19,000; that you were recruited to come to Hong Kong to commit the offences; there was a degree of planning in the operation in which your role was limited to collecting and remitting the money; and that you were not party to the deceptions or knew the monies were obtained by telephone deception, I am satisfied the proper starting point after trial on charge 1 is 3 years imprisonment.  

11.  A travel index check revealed that after committing the first offence you returned to the Mainland.  You came to Hong Kong again on the 15 June and committed three more offences over the next three days.  You collected $8,700 and $20,000 which after deducting your reward you remitted to China.  $90,000 was to be collected on the occasion you were arrested.  I am satisfied the proper starting point after trial on charges 2, 3 and 4 is 3 years and 3 months imprisonment.

12.  Giving you full credit for your pleas of guilty reduces the sentence on charge 1 to 2 years imprisonment and the sentences on charges 2, 3 and 4 to 2 years and 2 months imprisonment. 

Enhancement of sentence

13.  The prosecution apply for enhancement of sentence pursuant to section 27(2) of the Organized and Serious Crimes Ordinance on the grounds of the prevalence of the offence and the nature and extent of any harm, whether direct or indirect, caused to the community by recent occurrences of the offence.

14.  In support of the application the prosecution submit a statement of Detective Chief Inspector Lam Cheuk Ho, dated the 2 September 2015.  There has been no objection to the admission in evidence of the statement which has been read pursuant to section 65B of the Criminal Procedure Ordinance, Chapter 221. 

15.  The statement of DCIP Lam clearly shows a significant increase in what he has termed “Drop-off” cases and the consequential loss in such cases.  DCIP Lam concludes that the modus operandi of “Drop-off” in telephone deception cases and the associated money laundering activities are prevalent crimes in Hong Kong with obvious concern to the community.  On this evidence, which I accept, I am satisfied beyond reasonable doubt both grounds for enhancement are made out.

16.  I am satisfied the sentence on each charge is to be enhanced by one-third, which is the same enhancement as approved by the Court of Appeal in both Wu Jianbingand Lin Zong Yue.  The sentence on charge 1 is enhanced by 8 months to 2 years and 8 months imprisonment.  The sentences on charges 2, 3 and 4 are also enhanced by 8 months (which is just less than one-third) to 2 years and 10 months imprisonment.

Totality

17.  In Lin Zong Yue the Court of Appeal held that for three offences a total sentence of 3 years and 10 months imprisonment was appropriate.  Taking into account the four offences are separate offences of money laundering relating to four different victims and that charges 2, 3 and 4 were committed on a separate visit to Hong Kong, I am satisfied a total sentence of 4 years imprisonment is appropriate. 

18.  You are convicted and sentenced as follows:

Charges 2, 3 and 4 – 2 years and 10 months imprisonment concurrent on each charge; and

Charge 1 – 2 years and 8 months imprisonment; with 14 months consecutive and 18 months concurrent to charges 2, 3 and 4.

19.  This makes a total sentence to be served by you of 4 years imprisonment which I am satisfied properly reflects your criminal culpability on the four charges.