HKSAR v. HUANG JIANYE AND ANOTHER

DCCC332/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 332 OF 2010

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Reasons for Sentence

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1.  Both of the defendants have pleaded guilty to a charge of dealing with property known or believed to represent the proceeds of an indictable offence. The 1st defendant faces three further charges. The charges were committed over the period from 18 December to 8 January and it was on 8 January that they were arrested in Hong Kong.

2.  The facts admitted by the defendant disclose that the 1st charge relates to the withdrawal of $1.42 million in cash on 8 January by both defendants from the HSBC account held in the name of the 2nd defendant. 

3.  The 2nd and 3rd charges relate to the withdrawals of cash of just over HK$1.7 million and just over $1.3 million by the 1st defendant and a man called Huang Jiaxian on 18 December 2009 from two bank accounts with the Standard Chartered Bank and with HSBC both in the name of Mr Huang Jiaxian.

4.  The 4th charge relates to the withdrawal of $400,000 by the 1st defendant and a Mr Fan Haizhen on 29 December 2009 from a bank account with the Standard Chartered Bank held in the name of Mr Fan Haizhen.

5.  The two defendants were arrested at the Hongkong & Shanghai Bank having just withdrawn $1.42 million in cash on 8 January.  The withdrawals made, the prosecution allege and it is accepted, represented the proceeds of an indictable offence and the defendant had grounds to believe the monies represented the proceeds of an indictable offence.

6.  With regards to the 1st charge, New Taiwan Dollars 6 million, that is equivalent to HK$1.45 million, was transmitted from a Taiwanese female, a Madam Weng, into the account of the 2nd defendant on 7 January 2010.  At about 10 am the following day, the two defendants went to the bank, approached the bank staff and made application to withdraw the money.  D1 was the person who made the request for the withdrawal from the 2nd defendant’s account and presented the 2nd defendant’s Chinese two-way permit, mainland identity card and bank card.  Both defendants were led into a separate room and the cash was counted in front of them.  Whilst this was taking place, the 1st defendant made a number of calls on his mobile phone.  When the counting was complete, the money was placed in a bag and when they stepped out of the room with the money both defendants were arrested.  The conversation during the withdrawal was conducted exclusively by the 1st defendant, the 2nd defendant was silent throughout. 

7.  The 1st defendant started to rent a room at Flat C, 120-126 Second Street on 19 December and for that he was paying $1,300 per month.  This room was searched after the 1st defendant’s arrest and a chequebook and PIN number in relation to the 2nd defendant’s account were located in an envelope inside that room.

8.  The 2nd defendant is a mainlander who entered Hong Kong in the company of the 1st defendant on 5 January 2010.  Together they proceeded to open two accounts with the Hongkong & Shanghai Bank and the Standard Chartered Bank on the same day.  Another account was opened with the Citibank on the next day.  During his stay in Hong Kong, the 2nd defendant stayed in accommodation provided by the 1st defendant.

9.  In the black bag carried by the 1st defendant at the time of his arrest, the police also found a piece of paper containing several sets of handwritten information in respect of accounts held by the 2nd defendant and others including Wang Jiaxian and Fan Haizhen.  The documents included the account holder’s name, the account number, the name of the bank and the amount of the initial deposit.  The paper also contained the website address, telephone number and bank code of a number of banks.  The banks included were the Hongkong & Shanghai Bank, Citibank, Standard Chartered, Bank of China and the Nanyang Commercial Bank.  The accounts listed on this piece of paper corresponded with the information written on eight brown envelopes and their respective contents subsequently found on the top of a wall-mounted cabinet in D1’s room.  An example demonstrating the information written on the brown envelopes and the contents and information on the piece of paper found in D1’s black bag were set out as an annex to the Summary of Facts provided by the prosecution in the case.  This piece of paper in the eight brown envelopes also contained similar matching information in relation to other accounts held by the 2nd defendant, Huang Jiaxian and Fan Haizhen.

10.  As regards the 2nd and 3rd charges, these are the withdrawals on 18 December.  The prosecution say that Huang Jiaxian is a mainlander and he entered Hong Kong in the 1st defendant’s company on 14 December for the first time and opened accounts at three banks.  The respective sums of $1.39 million and 1.7 million were deposited from Taiwan into some of those accounts on 18 December 2009.  On the same day those funds were withdrawn by D1 and Huang, that is 1.39 million in cash from one of the accounts and four cash withdrawals totalling 1.7 million made in quick succession from another account.  A further $4,700 was drawn from a Standard Chartered Bank which was being used.

11.  When D1 and Huang made withdrawals from the accounts on 18 December, it was the 1st defendant who answered the due diligence questions put to Huang by the teller at the Standard Chartered Bank. Bank documents relating to Huang’s tabulated accounts were found in the brown envelopes in the 1st defendant’s room.  Under caution, D1 admitted to having accompanied Huang to withdraw the moneys from the banks.

12.  In respect of the 4th charge, the cash withdrawals from Fan Haizhen’s account on 29 December, Fan is a mainlander who entered Hong Kong with the 1st defendant on 21 December 2009 and he opened accounts at three banks.  $400,000 was deposited from Taiwan into one of those accounts and the exact sum was withdrawn the following day.  Fan’s bank documents in relation to her account with the Standard Chartered Bank and the other two banks were also found in the envelopes in D1’s room.  Under caution, the 1st defendant admitted having accompanied Fan to make the withdrawal.

13.  The total amount involved in the offences relating to the 1st defendant is $4.9 million and for the 2nd defendant $1.39 million.  I am told that both defendants have clear records.  The 1st defendant is 33.  He has resided in Hong Kong since 2008.  He was educated to secondary school level and apparently works as a renovation worker earning $10,000 per month.  He is married and has no children.  He lives with his wife in Yuen Long. 

14.  In mitigation I was told that D1 comes from a poor family on the mainland, his grandmother is over 80, his father and mother do not work and out of his earnings he has to contribute towards his upkeep in Hong Kong and also send money to the mainland.  I am told he regrets the offence and he apologises to the court.

15.  I was told that he knew a person called Ah Chuen from two years ago.  Ah Chuen is 45 years of age and he asked the 1st defendant to find friends to come to Hong Kong to open a bank account and money would be transmitted to Taiwan.  There was to be an introduction fee of $5,000 and each account holder was to be paid a processing fee of $10,000.  It was in carrying out of this scheme that the offences were committed and it was urged upon me that it was committed because of his need for money.

16.  The 2nd defendant is 25 years of age, he is a visitor from the mainland.  He was educated to Form 3 standard.  He has had a number of jobs.  He is the eldest of three children, his father is deceased.  I am told he comes from a poor region in China.  His father died when he was very young.

17.  These offences obviously have an international dimension.  Considerable planning went into the commission of these offences and there was obviously a syndicate behind the operation.  The 1st defendant, I was told in mitigation, was living with his wife in Yuen Long but it seems that from 19 December he was renting a room and he was carrying out this operation from that room.  Documents were found there relating to the various bank accounts which were used to process this money laundering activity.

18.  Looking at the amount involved in each of the offences, it seems to me that the appropriate starting point for each of them is 3 years and I reduce that to 2 years to reflect the guilty pleas.  So in respect of the 1st charge, each of the defendants will go to prison for 2 years.

19.  In respect of charges 2 to 4, I order that the sentences also be 2 years but 4 months be consecutive in respect of each of those offences so that the 1st defendant will go to prison for a period of 3 years in total.  The 2nd defendant a total of 2 years’ imprisonment.