HKSAR v. LAU SUM CHUNG KENNY

 DCCC48/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 48 OF 2010

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Reasons for Sentence

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1.  The defendant pleaded guilty to 1 charge of "Conspiracy to deal with property known or reasonably believed to represent proceeds of an indictable offence" (Charge 3). He also faced 1 charge of "False imprisonment" (Charge 1) and 1 charge of "Conspiracy to blackmail" (Charge 2). He was found NOT guilty of Charges 1 and 2 after trial.

Summary of Facts

2.  At the material times, Mr. LIU (PW2) was a 19-year-old student residing in Tin Shui Wai. At about 2:00 pm on 28 November 2009, he went to Macau on an invitation of an internet friend.

3.  By about 10:00 pm, a "chips agent"（疊碼仔）alleged that PW2 had lost $53,000 mud chips in gambling. He demanded PW2 to repay $50,000 and to sign an IOU for that amount. After signing an IOU, he gave PW2 a ferry ticket to return to Hong Kong. He also told PW2 that someone would contact him upon arriving at Hong Kong.

4.  PW2 arrived at the Shun Tak Ferry Terminal at about 11:00 pm. He was taken to a café in Causeway Bay by 2 males named Wai Gor and Ah Lung. Inside the café, Wai Gor phoned PW2's elder sister, Miss LIU (PW1). He told her that PW2 had lost $90,000 gambling in Macau and that PW2 was still in Macau. PW1 bargained to repay the debt by instalments. Wai Gor agreed to wait until the next day. He also allowed PW2 to speak to PW1 on the phone in order to prove that PW2 was safe.

5.  Later on, the defendant and a male named Hung Chai arrived at the café to join Wai Gor and Ah Lung. At about 2:30 am on 29 November 2009, the defendant and Hung Chai took PW2 to a sauna in Kowloon City by taxi. They spent the night there. At about 11:00 the next morning, the 3 of them went to a nearby café for breakfast. After that, they went to a mahjong parlour and waited inside a room.

6.  On the other hand, Ah Lung (in the absence of PW2, the defendant and Hung Chai) called PW1 twice on 29 November 2009 urging her to deposit money into a Hang Seng Bank account (the holder of which was the defendant). At about 11:00 am, PW1 deposited $20,000 cash into the defendant's bank account. Thereafter, PW1 sought help from the Police.

7.  At about 11:30 am, Ah Lung phoned PW1 informing her that he had received the $20,000. He then asked PW1 to pay the balance of $70,000 within 3 hours. When Ah Lung phoned PW1 again at a later time, the Police instructed PW1 to ask for a meeting with Ah Lung at Tin Chak Shopping Centre for handing over the $70,000.

8.  At about 2:30 pm on 29 November 2009, Wai Gor came to the mahjong parlour. In the presence of the defendant and Hung Chai, he told PW2 that his sister had repaid part of the debt and that she was going to pay them another sum; therefore, they would take him back to Tin Shui Wai.

9.  Thereafter, the defendant, Hung Chai and PW2 took a taxi to Tin Shui Wai. Upon arrival, Hung Chai left whilst the defendant took PW2 to meet PW1. PW2 saw PW1 at the Tin Chak Shopping Centre. As PW2 was walking towards PW1, the defendant was arrested by the Police.

10.  The subject bank account was opened by the defendant on 11 August 2009. According to the bank records, $20,000 cash was deposited into the account on 29 November 2009 and the same amount was withdrawn by ATM on the same day.

Mitigation & Sentence

11.  The defendant is now 47 years old and has a clear record. He separated with his wife last year. They have no children. The defendant previously worked as a part-time waiter earning $3,000 per month. In mitigation, Miss CHAN explained that owing to the defendant's dire financial situation, a friend asked him to open a bank account and sell it to that friend. Miss CHAN submitted that the defendant had no knowledge as to how his bank account would be used, though he had suspicions about it.

12.  As I have expressed in my Reasons for Verdict (for Charges 1 and 2), I have no doubt that the defendant and the others intended to keep PW2 as "collateral" for the purpose of collecting payment from PW1. Although I have found the defendant NOT guilty of Charges 1 and 2, he actively took part in keeping PW2 as collateral and the actual collection of repayment from PW1. In my view, he cannot now claim that he had no knowledge as to how his bank account would be used.

13.  The Court of Appeal in HKSAR v XU Xia Li & another CACC 395/2003 held "There are no guidelines for offences of this nature [i.e. money laundering]. The reason for this being that the circumstances of each case may vary almost indefinitely." In HKSAR v HUI Kam [2000] 3 HKLRD 211, Deputy High Court Judge Chu (as she then was) held "The offence in question [i.e. money laundering] is one which justifiably calls for a deterrent sentence, both in the sense of deterring the individual offender and of deterring the community as a whole. It is not too difficult to appreciate that the handling and disposal of proceeds of crime is very often an integral and important part of a criminal plan. The incentive to offend will clearly be curtailed if criminals cannot dispose of the fruits of the crime. It is therefore important to impress upon members of the public the serious consequences of dealing in and disposing of proceeds of crime even when one is helping his family member. Where a deterrent sentence is called for, then it is not wrong in principle to impose an immediate custodial sentence on a first offender."

14.  In HKSAR v NG Tsz Ming HCMA 454/2005 (Chinese judgment), the appellant allowed someone, whom he met on ICQ, to use his bank account to accept some funds in return for a commission. As a result, a sum of $49,000, which were proceeds of a theft offence, were transferred into the appellant's account. Deputy High Court Judge To (as he then was) upheld the starting point of 12 months imprisonment adopted by the trial magistrate.

15.  The role played by the defendant in this case is certainly more significant than someone who simply sold his ATM card or lent his bank account to others for dealing with proceeds of crimes. For the purpose of sentencing, I am entitled to take into consideration of the overall circumstances of this case. In my view, such a ruthless and controversial debt collection method (i.e. keeping the debtor as collateral and then pressing the family members to repay) should be strongly discouraged. Although only $20,000 was deposited into the defendant's bank account, the amount of repayment requested was $90,000 all along. Had PW1 not gone to the Police for help, I have no doubt that she would have eventually paid the balance of $70,000 into the defendant's bank account (by instalments or otherwise). Hence, I consider it just and appropriate to use $90,000 as the basis of my sentence.

16.  For Charge 3, I adopt 18 months imprisonment as the starting point. One-third discount is given for the guilty plea, reducing the sentence to 12 months. Apart from this, I see no other mitigating factors which warrant any further discount. The sentence I pass is therefore 12 months imprisonment.