HKSAR v. CHAN NOK HIM, FRANCO

DCCC 1392/2024

[2026] HKDC 273

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 1392 OF 2024

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REASONS FOR VERDICT

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A. Charge

1.  The defendant pleads not guilty to one count of “dealing with property known or believed to represent proceeds of an indictable offence”.

B. Introduction

2.  The defendant opened an account with the Mox Bank on 3 June 2021 (“the account”).  He was the sole account holder.  There were many deposits and withdrawals since then. After 14 April 2022, the account became inactive.

3.  Between 6 June 2021 (when the account was first active)  and 14 April 2022 (when the account was last active), there were 15,485 deposits and 4,374 withdrawals. That is 19,859 transactions in total (T1-T19859).  The total amounts of deposits and withdrawals were HK$27,422,127.81 and HK$27,404,823.52 respectively.  All the deposits and withdrawals were made by Internet transfers.

4.  The bank closed the account on 3 June 2022.

5.  Between 3 June 2021 and 14 April 2022, the defendant was in Hong Kong.  He was, however, in CSD custody between 8 December 2021 and 19 February 2022.

6.  The defendant was arrested at his residence for this case on 18 August 2022.  He told the police in a voluntary interview that he earned HK$26,000 per month in a dispensary.

7.  The defendant had no tax filing for the financial year of 2021-2022.

8.  Of the many deposits in the account, there were two deposits made by a Mr. Lam on 14 February 2022.  That Mr. Lam was an online-fraud victim.  He had been scammed of HK$470,806.80. Such monies were deposited by him into various accounts, including two deposits (HK$10,000.19 and HK$1,000.16)  into the defendant’s Mox account on 14 February 2022 while the defendant was still in CSD custody.

9.  Prosecution say the account was a temporary repository of funds including crime proceeds and the defendant with another person used the account to launder money.

C. Prosecution case

C.1 Agreed facts

10.  There are two sets of facts (Exh P11 and P14)  admitted under s 65C of the Criminal Procedure Ordinance.

C.1.1 Exh. P11

11.  According to Exh. P11:

(a)  The defendant opened an account with the Mox Bank on 3 June 2021;

(b)  Between 3 June 2021 and 14 April 2022, there were 15,485 deposits and 4,374 withdrawals; the total amounts of deposits and withdrawals were HK$27,422,127.81 and HK$27,404,823.52 respectively;

(c)  All the deposits and withdrawals were made by Internet transfers;

(d)  The many deposits included two deposits by a scam victim Mr. Lam, who on 14 February 2022 transferred HK$10,000.19 and HK$1,000.16 to the defendant’s account;

(e)  After 14 April 2022, the account became inactive;

(f)  The bank closed the account on 3 June 2022;

(g)  Between 3 June 2021 and 14 April 2022, the defendant was in Hong Kong; he was however in CSD custody between 8 December 2021 and 19 February 2022;

(h)  The defendant was arrested for this case on 18 August 2022 at Room 1104 Yiu Fung House, Tin Yiu Estate, Tin Shui Wai; his verbal reply under caution was recorded in the arresting officer’s notebook (Exh P6 / English translation P6A);

(i)  The defendant had a voluntary interview with the police on 18 August 2022 (Exh P9 / Chinese transcript P8 / English translation P8A);

(j)  The defendant had no tax filing for the financial year of 2021-2022.

C.1.2 Exh. P14

12.  According to Exh P14:

(a)  Between the opening of the account (on 3 June 2021)  and 01:01:07 hours on 17 November 2021, there were 266 deposits totaling HK$228,926 and 527 withdrawals totaling HK$229,061.04;

(b)  Between 8 December 2021 and 19 February 2022, when the defendant was in CSD custody, there were 7,807 deposits totaling HK$ 13,823,893.27 and 2,038 withdrawals totaling HK$13,742,422.

C.2 Prosecution witnesses

C.2.1 PW5

13.  PW5 is Miss Choi.  She gave a witness statement to the police when she was a Due Diligence and Fraud Investigation Assistant Manager of the Mox Bank in April 2024; she was later promoted.

14.  PW5’s witness statement is admitted under s 65B of the Criminal Procedure Ordinance (Exh P12 / English translation P12A).  She also gives evidence in court.

15.  In court, PW5 produces Exh P13 to explain how the bank notified the account holder in the instant case by SMS and email of any transaction and application for change of contacts.  Such notifications would be sent to the account holder’s bind-device registered with the bank.

16.  About the bind-device, PW5 says one account can only have one bind-device registered at any time.  If the account holder wants to change his bind-device, he need to apply to dismiss the original bind-device by logging in with his ID and password.  The account holder would then receive a one-time password in his bind-device and he would be alerted that another device had just been logging onto his account.

17.  Referring to Exh P13, PW5 says the record shows the original bind-device for the defendant’s account on 3 June 2021 was an Apple iPhone X.  It was changed to an Apple iPhone 6 on 14 November 2021 and changed back to the said Apple iPhone X on 15 November 2021;  on 16 November 2021, the registration was changed back to the said Apple iPhone 6;  it was later further changed to a Xiaomi M2010 on 17 November 2021 and then to another Xiaomi M2010 (with a different device correlation ID)  on 29 November 2021. Hence, a total of four bind-devices had been registered at different times for the defendant’s account since its opening on 3 June 2021.

18.  In her witness statement (Exh P12), PW5 says the email / phone number / address registered with the bank when the defendant opened his account on 3 June 2021 were respectively: “him_0219@yahoo.com / 5330 9874 / Flat 1104, Floor 11, Yiu Fung House, Tin Yiu Est, Tin Shui Wai”.  Those particulars were amended on 17 November 2021 to “francochan7115@outlook.com / 6017 2240 / Flat 1103, Floor 11, Ching Hoi House, Tin Ching Est, Tin Shui Wai”.  PW5 says the amendments could be made on the Mox application.  The applicant had to log onto the account by submitting the account-holder’s ID number and the email / phone number / address that had been registered with the bank when the defendant opened the account on 3 June 2021.

19.  About the many transactions, PW5 says the bank would notify the account holder instantly by SMS and email of each deposit and withdrawal.  Since the account holder had engaged the ‘PUSH DISABLED’ function, the messages from the bank would not pop up in his current bind-device.  However, those SMS and email notifications would still reach the account holder’s bind-device for him to check.  Also, the account holder could see such information in the Mox application.

20.  PW5 only joined the Mox Bank in January 2023.  Defence Counsel suggests to her that the notification procedures around 2021 might not be the same as she now testifies.  PW5 disagrees.  She says she has checked the internal procedures with reference to the guidelines set by the management and understands that there have been no such changes as counsel suggests.  She also says she had been a customer of the bank before she joined the bank.

C.2.2 PW6

21.  PW6 is Mr. Fung.  He made the two bank affirmations (Exh. P2 and P3; P2 relates to the first 9,859 transactions [T1-T9859] of the defendant’s account; P3 covers the remaining 10,000 transactions [T9860-T19859] ).  

22.  PW6 tells the court how the fact-sheets in the affirmations should be read.

D. The defendant’s voluntary statement

23.  The defendant was arrested for deception in relation to Mr. Lam’s being scammed of some money and two of the deposits (HK$10,000.19 and HK$1,000.16)  went to the defendant’s account on 14 February 2022.  Under caution, the defendant said “I was just released from prison on 19^th February this year. I did not use the account at that time”  That statement was recorded in the arresting officer’s notebook (Exh P6  / English translation P6A)  and repeated by the investigator to the defendant in the voluntary video-recorded interview (Exh P9; #11-18).

24.  In the interview, the defendant told the investigator that he worked in a pharmacy as sales earning $26,000 (#35-40).

25.  The defendant said his current mobile number was 5298 1125 and he had used that number for about 6 months.  It was a pre-paid phone card (#41-50).

26.  The defendant said he was imprisoned from December 2021 up to 19 February 2022 for possession of offensive weapon (#51-62).

27.  The defendant said he knew nothing of the mobile numbers 5273 0237 and 9159 3442 (#63-68).

28.  The defendant said he only had BOC, HSBC, Hang Seng, Mox and ZA accounts (#71-72).

29.  The defendant said he opened the Mox account in early 2020.  It was an online account. He could not remember its number.  He opened the account to get a credit card and to build up savings (#93-106).  He used the account right after it was opened, for buying movie tickets and there was no other use (#113-122).

30.  The defendant said there was probably no money in the account now (#123-126).  It was a savings account.  He last put money into it a long time ago and stopped using the account in the beginning of 2021(#128-136).

31.  The defendant said he knew nothing of the FPS (“Faster Payment System”)  account number 6017 2240 (#141-146).

32.  The defendant said he had lost his Hang Seng card and just reported its loss last week, in mid-August.  He was waiting for the replacement card to be sent to him (#149-166).  He confirmed with the investigator that he had not made any earlier report of loss (#167-172).

33.  The defendant said that after his coming out of prison in February 2022, he could not log onto his Mox account when he intended to buy movie tickets.  After failing to log in, he just left the account idle because he did not have time to deal with it (#189-192).

34.  The defendant said he had made enquiry with the Mox Bank.  The staff told him to wait for a few days and to call again.  The defendant did not call the bank again until he was out (of prison).  By then, it was mid-March (#193-198).

35.  In #215-218, the investigator asked about the defendant’s Alipay.  The defendant replied he started using Alipay in 2017 and said “Because (it)  has my identity card as well.”  [He did not take the chance to tell the investigator that he had lost his ID card around 17 November 2021 as he now asserts in court.]

36.  In #231-234, the investigator asked what device the defendant would use for Alipay, the defendant said “iPhone.” [Again, the defendant did not take the chance to tell the investigator that he had lost his two iPhones around 17 November 2021, allegedly together with his ID card.]

37.  The investigator enquired about some suspicious transactions.  The defendant said he did not use his Mox account anymore and he knew nothing of the funds in it after he had stopped using the account (#241-246).

38.  The defendant said he knew nothing of the names, telephone numbers and bank accounts raised by the investigator (#247-310).

39.  The investigator asked the defendant if he had ever lent his Mox account to anyone.  The defendant hesitantly replied “Er… (I)  suppose not.” (#323-324).

40.  The account had to be logged in with the defendant’s phone number and password. The investigator asked if he had given his phone number and password to others. The defendant again hesitantly answered “Er … no.” (#325-328).

41.  When the defendant opened the account in June 2021, the mobile number used for registration was 5460 3071.  The investigator asked the defendant why he did not use that number afterwards. The defendant did not say he had lost his phone.  Instead, he told the investigator  “Because at that time, er… why didn’t (I)  use (it)?  (I)  mean at that time, ah, it seems that (I)  didn’t pay, didn’t pay the phone bill, and then (I)  didn’t, didn’t use (it)  any longer.” (#329-338)

42.  The investigator asked again if the defendant had lent the password of his account to anyone.  The defendant again hesitantly said “Er…(I)  suppose (I)  haven‘t either.” (#339-340).

43.  The defendant said the Mox bank would probably send e-statement to his email address “him_0219@yahoo.com” but he seldom checked it (#345-370).

44.  The defendant said he had not received calls from the Mox Bank about any suspicious transactions. He said his phone service had been cut as he had been in prison for some months and the phone bills had not been settled during that period.  After that, he tried to ask the mobile service provider to reactivate the number but it was not successful (#371-378).  

45.  The defendant said he did not ask the Mox Bank of any transaction record (#381-382).  He failed to reactivate the account because he could not get back his old mobile number to receive any verification code from the bank (#383-388).

46.  The defendant said he had not touched his Mox account since his going to prison and after coming out of it.  He was not aware of its further activities and the bank had not sent him monthly statements (#390-394).

E. Mid-stage

47.  Defence Counsel makes no submission at this stage.  I rule the defendant has a case to answer on the charge.

F. Defence case

48.  The defendant elects to give evidence.  He calls no other witnesses.

49.  There were Defence Exhibits D1 to D6.

F.1 Agreed facts

50.  Exh D3 is a set of s 65C agreed facts.  It says:

(a)  When the defendant was admitted to LCK Reception Centre on 8 December 2021, he did not have his ID card in his possession;

(b)  On 24 February 2022, the defendant reported the loss of his identity card to the police and alleged he lost it on 7 December 2021 (Police report number TSW Div 22007068).

F.2 The defendant’s evidence

51.  The defendant says he had studied up to Form 5 and had started working in the pharmacy business from the age of 14 (summer job).  Since then, he had been working in the pharmacy trade and thus knew a lot of the business.

52.  The defendant tries to explain for the many transactions in his Mox account. He says many customers bought pharmacy merchandize through him.  Some customers were in Hong Kong;  some were in China.  They would send him money online.  He then arranged for the goods to be delivered and he had to pay the delivery men.  

53.  The defendant says he did business both for his pharmacy boss and for himself.  In the latter case, he would make a profit for himself.

54.  The defendant says he never used his Mox account to pay his boss for the goods.  He would do that through his other accounts.

55.  As to why many sums were in round figures, the defendant says they included his own earnings.

56.  The defendant says sometimes he borrowed money from his relatives like his mother and aunt. Those transactions were also made through his Mox account.

57.  The defendant says his Mox account was bound to his iPhone x.  He only need to key in his password when he used the Mox application on the phone (and also his user ID on the first occasion when he used that bind-device).  Sometimes, he would use his other phone – an iPhone 6.  Then he would receive a one-time verification code on his iPhone x for changing to use iPhone 6.

58.  The defendant says he last used his Mox account at 01:01:07 hours on 17 November 2021 (T793).  He had drinks with friends that night.  When he woke up in a hotel, he was alone and found that he had lost his two iPhones and a wallet containing some money, ID card and several bank cards including the Mox card.

59.  The defendant says he was not the one who on 17 November 2021 applied to the Mox Bank to change the registered email address, mobile number and residential address (see para. 18 above).  As to the new email address and mobile number, he had no idea whose they were.  The new address was his previous residence but he had moved out of that place with his family to live now at the Yiu Fung House address originally registered with the Mox Bank and he had been living there continuously.  The defendant says the Ching Hoi House premises had been surrendered to the Housing Department.  He and his family had no relationship with that old address since then.

60.  The defendant says the first 793 transactions in the Mox account (T1-T793)  were all related to him.

61.  In any transaction, there would be an “originator” (the paying party)  and a “beneficiary” (the receiving party).  Sometimes, the defendant was the originator when he paid others out of the account; sometimes he was the beneficiary when others paid into his account.

62.  The defendant says he knew the other originators and beneficiaries in T1-T793 (see Exh D5 – the “originator list” and Exh D6 – the “beneficiary list”).  But for T794-T19859, he was not responsible at all and he knew none of those originators and beneficiaries there. 

G. Final submission

G.1 Prosecution

63.  The Prosecutor says the defendant is not credible.  She points out the defendant’s claims in court contradict his previous statement to the police in many places.  She comments that the defendant’s explanations over T1-T793 do not make sense.

64.  The Prosecutor says the Mox account was all along used as a temporary repository of funds to launder money. The defendant was always in control of it and another person just acted for him when he was in custody between 8 December 2021 and 19 February 2022.

G.2 Defence

65.  Defence Counsel says the defendant’s claims might be true.  He points out the defendant did not have his ID card with him when he was taken into CSD custody on 8 December 2021.

H. Discussion

66.  The defendant opened his Mox account on 3 June 2021.  It was first active on 6 June 2021 and last active on 14 April 2022.  The bank closed the account on 3 June 2022.  During a period of ten odd months (6 June 2021 - 14 April 2022), there were 19,859 transactions (T1-T19859)  including 15,485 deposits totaling HK$27,422,127.81 and 4,374 withdrawals totaling HK$27,404,823.52.

67.  The defendant was in CSD custody between 8 December 2021 and 19 February 2022.  During that period of two odd months, there were 9,845 transactions consisting of 7,807 deposits totaling HK$13,823,893.27 (including the scam-victim Mr. Lam’s two payments of HK$10,000.19 and HK$1,000.16 on 14 February 2022)  and 2,038 withdrawals totaling HK$13,742,422.

68.  Despite his incarceration between 8 December 2021 and 19 February 2022, Prosecution say the defendant was in control of his Mox account throughout and another person collaborated with him in using the account to launder money.

69.  The defendant elects to give evidence in court.  His defence is he was only responsible for T1-T793, which were all legitimate deals and he had nothing to do with T794-T19859.  Someone took control of his account without his knowledge and authority after he had lost his iPhones and a wallet containing his ID card with several bankcards (including the Mox card)  around 17 November 2021.

H.1 T1-T793

70.  The defendant says he was only responsible for T1-T793.  He had been using his Mox account from its opening in June 2021 until he lost control of it around 17 November 2021.  

71.  Between 6 June 2021 and 01:01:07 hours on 17 November 2021, there were 266 deposits totaling HK$228,926 and 527 withdrawals totaling HK$229,061.04.  The defendant claims those 793 transactions were all for lawful business.

H.1.1 Originators and beneficiaries in T1-T793

72.  In T1-T793, apart from the defendant sometimes as “originator” and sometimes as “beneficiary”, there were 69 other originators (see MFI-1)  and 41 other beneficiaries (see MFI-2). 

73.  Of the 69 originators and 41 beneficiaries, 23 names in each list are the same.  That is, 23 of those originators were beneficiaries at other times[1].

74.  The defendant says he knew all the originators and beneficiaries; he classifies them into different categories.

75.  Of those 69 originators, the defendant says 47 were his friends (marked in blue; see Exh D5), 14 were his clients (marked in green), 5 were workers delivering goods for him to the clients (marked in yellow)  and 3 were his relatives (Chan Shuk Yu - his mother, Chan Kit Yu - his aunt and To Hoi Shan - his wife).

76.  Of the 41 beneficiaries, the defendant says 28 were his friends (marked in blue; see Exh D6), 6 were his clients (marked in green), 6 were workers delivering goods for him to the clients (marked in yellow)  and one was his wife (To Hoi Shan).

77.  The defendant says he used his Mox account for lawful transactions: loans and payments between himself and friends/relatives; payments from clients and refunds to clients; payments to delivery workers and refunds from delivery workers.

78.  Analysis of the funds, however, does not support the defendant’s claim (see the data sheet prepared by Prosecution [MFI-5]).

79.  For example, a so-called “client” Leung Sum Wah paid five times into the account (see MFI-3; 5 incomings totaling $2,600[2])  but he received more frequently and more money from the defendant’s account (28 outgoings totaling $12,092[3]).

80.  Also, a so-called “delivery man” Cheung Wing Ho received totally $20,000 from the defendant’s account for alleged deliveries (see MFI-4; 48 outgoings[4])  but he paid back $3,000 into the account (3 incomings[5]).

81.  The defendant tries to explain for the above phenomena.  He says there were refunds due to undelivered goods or excess payments. He also says he had received money from Leung Sum Wah through another source. 

82.  However, what the defendant says about refunds, excess payments or Leung Sum Wah paying him through another source are all mere assertions.

83.  It is also worthwhile to note that the so-called “client” Leung Sum Wah made his five payments within a short period of 24 hours and indeed the first four were made within just three and a half hours (see MFI-3).

H.1.2 Temporary repository of funds (T1-T793)

84.  For T1-T793 (between 6 June 2021 and 01:01:07 hours on 17 November 2021), there were 266 deposits totaling HK$228,926 and 527 withdrawals totaling HK$229,061.04. Sometimes, there were many transactions in a day. The funds accumulated and then went out of the account soon in different amounts.  That suggests the account was being used as a temporary repository of funds.  The phenomenon does not correspond to any known legitimate business but is a typical feature of “money laundering”.

85.  There is another typical feature of “money laundering”.  That is, quite a number of  “originators” were also “beneficiaries” (see para. 73 above).

86.  Some of the transactions in T1-T793 were related to the defendant’s mother, aunt and wife but they accounted for a very small portion of the funds. Even so, some of their transactions look suspicious. For example, the wife To Hoi Shan received money twice within 7 minutes on 20 July 2021 (T398 & T399); paid out twice within 3 minutes on 28 September 2021 (T743 & T744); paid out once and received money once within 6 minutes on 13 October 2021 (T755 & T756); the aunt Chan Kit Yu paid out twice within about 35 minutes on 14 November 2021 (T780 & T782);  the mother Chan Shuk Yu and the aunt Chan Kit Yu each paid out once within about 40 minutes on 17 November 2021 (T790 & T792).

87.  All in all, I do not accept the defendant’s claim of legitimate dealings in relation to T1-T793. 

H.2 T794-T19859

88.  The defendant says he went for drinks and dinner with friends on the night of 16 November 2021 to celebrate a female friend Liu Pik Ki’s birthday.  That night, he transferred money to Liu a few times during dinner and drinking after Liu had paid the costs first; he immediately paid her back his due share.

89.  Exh P2A shows the defendant first paid Liu on 15 June 2021. Since then, there were a number of payments to Liu; sometimes several times a day (e.g., twice on 1 November 2021 / T762 & T764; twice on 2 November 2021 / T766 & T767; twice on 13 November 2021 / T773 & T775; twice on 14 November 2021 / T781 & T783; three times on 16 November 2021 / T785, T786 & T788); and again three times on 17 November 2021 in a mere 45-minute period between 00:16:13 hours and 01:01:17 hours / T789, T791 & T793).

90.  The defendant says he last paid back $500 to Liu (T793).  Later, he got too drunk.  A friend surnamed Chu took him to a hotel, paid the bill and left him there.  When the defendant woke up, he found his wallet missing which contained some money, several bankcards and his ID card.  He also lost his iPhone x (with two prepaid phone cards in it)  and iPhone 6.  He later made enquires with Chu and other friends who drank with him that night but to no avail.

91.  The defendant claims he had lost control of his Mox account after T793.

H.2.1 Alleged loss of many properties around 17 November 2021

92.  The defendant says he did not make any enquiry or file complaint with the hotel after the loss.  He subsequently contacted the Immigration Department for a replacement ID card.  During that pandemic period, it would take him some months to get a new card.

93.  The defendant says he had a total of 9 bank accounts at that time.  Several were on-line bank accounts including the Mox one.  There was virtually no money in those on-line bank accounts so he only reported loss of bankcards to Hang Seng, BOC and HSBC. He had not yet got the replacement ID card by then.  Nevertheless, he managed to apply for new cards from Hang Seng, BOC and HSBC with his passport.

94.  In his VRI, when being asked of his Hang Seng Card, the defendant told the officer that he had reported the loss to Hang Seng Bank shortly before his arrest, i.e., in mid-August 2022.

95.  I find such delayed report to the Hang Seng Bank odd; there was an inexplicable lapse of 9 months after the alleged mid-November 2021 loss.

96.  The defendant’s purported reports of loss to the Immigration Department and the Hang Seng Bank as well as to BOC and HSBC are all mere assertions; there is no proof.  But even if he at some stage did tell the Immigration Department and those banks that he had lost his cards and applied for new ones, it still cannot prove he had really lost the properties as he now asserts.

97.  The defendant apparently had not alerted the Mox Bank immediately after the alleged loss.  He tries to explain that the account was not important to him.  

98.  The account was obviously not unimportant to the defendant.  For the five odd months which the defendant acknowledges using the account (between 6 June 2021 and 01:01:07 hours on 17 November 2021), there were 793 transactions consisting of 266 deposits totaling HK$228,926 and 527 withdrawals totaling HK$229,061.04. 

99.  The defendant says when he contacted the Mox Bank, an unidentified staff on the phone said he would go back to the defendant but he never did.

100.  It sounds unusual for a bank (albeit an online bank)  to ignore a reported loss of card in that way, particularly when the account had a large numbers of in’s and out’s.

101.  Furthermore, what the defendant tells the court now is not the same as he told the investigator in his VRI.  There, he told the investigator that the Mox staff told him to wait for a few days and to call again.  The defendant said he himself did not call the bank again until he was out of prison (see para. 34 above).

102.  The defendant says he was unable to get back the lost registered mobile number as it was merely a pre-paid phone card.  He thus could not receive any verification code from the bank to further deal with the Mox Bank and his account.

103.  People sometimes do lose their phones or they would change their mobile number.  It is unimaginable that the staff of the Mox Bank would not advise the defendant on how he could apply to change his registered mobile number to a new one or to use other means to receive any verification code for the further handling of his account.

104.  Another strange feature of the defendant’s saying is his failure to inform or complain to the hotel about the alleged loss of his many properties once he found it out or at any later time.

105.  When the defendant was taken into CSD custody for possession of offensive weapon on 8 December 2021, he indeed did not have any ID card with him.  However, he only made a report of loss to the police on 24 February 2022, i.e. five days after his release on 19 February 2022.  And that was over three months after his alleged loss in mid-November the previous year.  

106.  That loss report on 24 February 2022 shows the date of the defendant’s losing his ID card was 7 December 2021.  In court, the defendant claims the date of 7 December 2021 was suggested to him by the interviewing officer as he himself could not remember the exact date.

107.  Losing many properties including ID card after celebrating with friends for Liu’s birthday would not be a blurry experience.  The defendant could have found out the exact date from Liu and those friends going out with him that night.  Or he could have found out the date from the Immigration Department papers if he had really reported loss of his ID card to the department by then.

108.  In any event, it is unusual for a police officer to make that kind of suggestion to a person reporting the loss of his ID card.

109.  It is further to be noted that the defendant failed to raise in his report that he had lost other properties.  He also did not tell the police of the circumstances surrounding the alleged loss.

110.  In court, the defendant says he did not report the loss of his wallet as it contained only a few hundred dollars.  He alleges he applied for replacement cards from some banks only (see para. 93 above).  He explains for the deferred reporting of the loss of his ID card by saying he was troubled by a pending court case.

111.  On the whole, the defendant cannot explain for his failure to enquire with the hotel, his deferred reporting of the loss of ID card and his failure to tell the police of the other alleged lost properties plus the circumstances of the purported loss.

112.  I do not believe the defendant had really lost his ID card, bankcards, iPhones etc. on or around 17 November 2021.  I am sure if he had ever made any report of loss to the Immigration Department, the police or any bank, they were merely to serve the defendant’s own purpose rather than as reports of genuine loss.

H.2.2 Losing control of his Mox account

113.  The defendant says he had no knowledge of those transactions after T793 and he had nothing to do with T794 - T19859.  He claims he had written down the passwords on his bankcards. Thus a hacker could apply to the Mox Bank to change the registration particulars on 17 November 2021.  The defendant says the hacker might know of his old address, which could be found in his social media information.

114.  The defendant says he at some stage had told the Mox Bank of the loss of his bankcard but received no response.  He then left the account idle as there was no money in it and the account was not important to him.

115.  The account was obviously not unimportant to the defendant (see para. 98 above).  It is hard to believe the defendant would simply ignore the account after the alleged irresponsible handling by the bank staff of his reported loss of the Mox card.

116.  After T793 at 01:01:07 hours on 17 November 2021, T794 came about 16 hours later at 17:40:18 hours that day.  It was a deposit of HK$350.09 from one Chu Man Fung.

117.  Up to 23:59:22 hours on the same day, there were 43 other transactions (T795 - T837).  Some deposited hundreds or even thousands into the account (as much as HK$30,000 in T803).  And after 17 November 2021, there were many more sums deposited into the account (the last one being $20,000.87 in T19851; on 14 April 2022). In total, there were 15,219 deposits after T793 up to 14 April 2022 when the account was last active, totaling HK$27,193,201.81.

118.  It is unimaginable that a hacker would use another person’s bank account to receive so much money over an extended period of months without the account holder’s consent just because he got hold of the account holder’s personal particulars; then daringly on the same day applied to the bank to change the registered details to gain control of the account, and then ran the account as his own with many incomings and outgoings. Did the hacker not worry the account holder might find out the situation and take up the matter with the bank or the police to freeze all the funds in the account?

119.  I do not believe there was such hacker of the defendant’s account at any time.

H.2.3 CSD custody

120.  It is true the defendant was in CSD custody between 8 December 2021 and 19 February 2022.  During that period, there were 7,807 deposits totaling HK$13,823,893.27 and 2,038 withdrawals totaling HK$13,742,422.  The defendant of course could not operate his account during CSD custody. But he well knew he had to go to court to meet this fate. He could have prepared for someone to manage the account for him in case he would lose his liberty in that court matter. 

121.  I reject the defendant’s claim that he had lost grip of his account after T793 and that someone operated the account beyond his knowledge and control. I am sure the defendant had arranged for someone to manage the account on his behalf while he was in CSD custody.

H.3 Temporary repository of funds (T794 - T19859)

122.  Between 6 June 2021 (account first active)  and 14 April 2022 (last active), there were 15,485 deposits and 4,374 withdrawals.  The total amounts of deposits and withdrawals were HK$27,422,127.81 and HK$27,404,823.53 respectively.

123.  In those ten odd months, there were many transactions in a day.  The other (meaning other than “NOK HIM FRANCO CHAN”)  originators and beneficiaries in T794 - T19859 appeared to be different from those in T1 - T793 and the amounts transacted now were mostly with decimal places rather than mainly round figures. However, the account was still used as a temporary repository of funds. The funds accumulated and went out of the account soon in different amounts.  It is a typical feature of “money laundering”.

124.  There is another typical feature of “money laundering”.  We have already seen in T1 - T793 that a number of other originators were also beneficiaries (see para. 73 above). An analysis of the last 10,000 transactions (T9860 - T19859)  reveals a similar phenomenon: five of the top ten other originators were among the top ten other beneficiaries (see Fund Flow Analysis -- Exh. P5 Annex B / Bundle #1572-1573).

125.  I am sure the defendant’s Mox account was used for money laundering in T794 - T19859, just like T1 - T793.

H.4 Verdict

126.  There is evidence a Mr. Lam had been scammed and thus paid $10,000.19 and $1,000.16 into the defendant’s account on 14 February 2022.  At that time, the defendant was in CSD custody. 

127.  There is indeed no evidence to prove the defendant was involved in or knew of the scam.   

128.  The offence of “money laundering” has two limbs: “ knowing” and “having reasonable ground to believe”.  Prosecutor makes it clear that she is pursuing on the second limb only. Thus, there is no need to prove the defendant knew any funds in his account were crime proceeds.

129.  Having considered all the evidence and counsel’s submissions, I find as I am sure the defendant together with another person were responsible for the management of the account between its opening and the end.

130.  Either the defendant himself applied to the bank for the change of registration particulars on 17 November 2021 or he authorized another to do it on his behalf.  And the defendant had authorized his deputy to operate the account for him while he was in CSD custody between 8 December 2021 and 19 February 2022.

131.  The total deposits and withdrawals involved were HK$27,422,127.81 and HK$27,404,823.52 respectively.  The amounts were huge. The defendant only had provable income of insignificant sums.

132.  Any reasonable people grasping the defendant’s true situation (including his knowledge of all the activities in his Mox account)  would be sure the funds in the account between 6 June 2021 and 14 April 2022, in whole or in part, directly or indirectly, represented proceeds of an indictable crime.  The defendant and another person collaborating with him dealt with the funds therein.

133.  Prosecution have proved the charge against the defendant beyond all reasonable doubts. I thus find him guilty as charged.