HKSAR v. TANG TSZ FEI

DCCC 1032/2023

[2024] HKDC 1962

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 1032 OF 2023

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REASONS FOR SENTENCE

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The defendant faces 2 charges of "Conspiracy to defraud" (Charges 1 and 3)  and 2 charges of "Money laundering" (Charges 2 and 4; alternative to Charges 1 and 3 respectively). He pleaded guilty to Charges 2 and 4, which was accepted by the prosecution. I made no order as to Charges 1 and 3.

Summary of Facts

Charge 2

2.  About 11:00 a.m. on 28 March 2023, Mr. Chung (PW1; aged 77)  received a phone call made to his landline at home from an unknown male (Male A)  claiming to be his son "Ah Keung".  Male A told PW1 that he was arrested by the Police for fighting and needed $100,000 to pay compensation.

3.  PW1 believed Male A and told Male A that he only had $50,000 cash.  Male A told PW1 that his friend "Kit Jai" would go collect the money from PW1 around 1:00 p.m. and PW1 told Male A his address.

4.  About 1:30 p.m. on the same day, the defendant knocked on PW1's door.  PW1 gave him a white envelope containing $50,000 cash.  PW1 later discovered that he was deceived and alerted the Police.

Charge 4

5.  About 3:00 p.m. on 28 March 2023, Mr. Lau (PW2; aged 24)  received a phone call made to his landline at home from an unknown male (Male B)  addressing PW2 as father.  Male B told PW2 that he was arrested by the Police for fighting and needed money for bail.

6.  PW2 did not have a son and suspected that it was a telephone scam.  He continued to talk to Male B, who claimed that he needed $150,000 as bail money.  Male B told PW2 that his friend "Ah Kit" would go collect the money from PW2.  Later, another male (Male C)  called PW2.  He claimed himself as Ah Kit and told PW2 that he would come collect the bail money for PW2's son.  They agreed to meet at the entrance of Phase 3, Chun Wah Villas in Yuen Long.

7.  About 3:00 p.m. on the same day, a security guard of Chun Wah Villas (PW3 Madam Wong)  stopped the defendant for enquiry.  PW3 asked him where he wanted to go.  The defendant said he was looking for a person surnamed Chan in Block 10 and asked if there was a 5^th Floor.  The defendant then said he needed to make a phone call to confirm and left.

Arrest and admissions

8.  The defendant was immediately arrested by PC 18618 (PW4), who was laying ambush nearby.  Under caution, the defendant said his boss had asked him to collect things at Block 10 of Chun Wah Villas; he did not know that people were deceived.

9.  In his 1^st video recorded interview, regarding Charge 4, the defendant claimed that he did not know PW2 or his phone number.  He saw a job advertisement on Facebook recruiting people to collect things at a daily wage of $1,000.  He then contacted the person who posted the advertisement.  Later, someone contacted him by WhatsApp.  The defendant also received a voice call from someone whom he referred to as his boss, asking him to go to Phase 3, Chun Wah Villas to collect things.  The defendant could not enter the area because a security guard had stopped him.  After that, he was arrested.  The defendant identified himself in the CCTV footage of Chun Wah Villas.

10.  In his 2^nd video recorded interview, regarding Charge 2, the defendant claimed that he did not know PW1 and denied having called him.  When asked about a person who went to PW1's flat to collect a white envelope containing $50,000 cash, the defendant admitted that he was that person.  The defendant said he was instructed by his boss to go to Tai Hing Estate, claiming to be Ah Keung to collect things from PW1.  His boss later told him to claim himself as Kit Jai instead.  The defendant claimed that his boss did not tell him what he was collecting from PW1.  He also claimed that he did not open the envelope since it was tied up by a rubber band.  The defendant gave the envelope to an unknown male in the vicinity as instructed by his boss.  The defendant admitted that he felt strange [about what he was asked to do] but denied knowledge of the deception.  He claimed that since he had not received any reward yet, he continued to do the jobs given to him by his boss.  The defendant identified himself in the CCTV footage of Hing Cheung House, Tai Hing Estate.

Mitigation & Sentence

11.  The defendant is 22 and has a clear record.  Defence counsel Mr. Chan informed me that the defendant is single and resides with his mother.  His parents were divorced in 2007.  After secondary school, the defendant took courses offered by the Vocational Training Council and was promoted to the Higher Diploma level, but did not complete it. He then worked as a waiter and completed some security guard training.  In mitigation, Mr. Chan submitted that the defendant is truly remorseful and understands that he has disappointed his mother deeply.  A bundle of mitigation letters was placed before me; their contents are duly noted.

12.  The prosecution has applied for an enhanced sentence pursuant to section 27(2)(c), (d)  and (e)  of the Organized and Serious Crimes Ordinance (Cap.455)  on the basis of prevalence; the nature and extent of harm caused to the community; and the nature and extent of the total benefit gained by anyone from the present offences.  Mr. Chan did not object to the application for enhancement.

13.  I bear in mind the Court of Appeal's decision in HKSAR v Xu Mai Qing CACC 464/2005, whereas Yeung JA (as he then was)  held "Under section 27(11)  of OSCO, what the prosecution has to prove is the prevalence of the offence, not the increase in the number of such offences[1]."

14.  I have read the witness statement of DCIP Tang dated 17 August 2023.  I am satisfied that in 2022, telephone deception cases were prevalent in Hong Kong in terms of the number of cases as well as the total value of monetary loss.

15.  The "By Hand" mode phone deception cases always involve someone picking up the money left behind by the victim at a public place or collecting the money directly from the victim.  Hence, the money collection portion is part and parcel of any type of phone deception ("Guess Who", "Pretend Officials" or "Detained Son").  Although the "collector" may not have knowledge of the underlying phone deception, the circumstances under which he/she picks up or collects the money are usually peculiar and would thus arouse his/her suspicion about the legality of his/her collecting act and/or the nature of the money collected.  That is the reason why the "collector simpliciter" is often charged with a money laundering offence (instead of deception).

16.  There is clear and cogent evidence before me that the "By Hand" mode phone deception is still widespread and commonly being practised in Hong Kong today.  The court must send a clear message to the general public that people who play the role of "collector" will receive severe punishment, so that there is a deterrent effect.  When there are fewer or no willing "collectors", the "By Hand" mode phone deception method would fail.

17.  The defendant claimed that he did not have any prior knowledge of the underlying phone deception; however, the 2 scams in the present case would have been meaningless without a willing "collector".  Given the role played by him, the amount involved and the overall circumstances, I grant the prosecution's application and will enhance the sentence by 25%.

18.  The Court of Appeal in SJ v Wan Kwok Keung [2012] 1 HKLRD 201 held :-

Generally, the sentence for "money laundering" offences should mainly reflect the amount of "black money" laundered and not the benefit obtained by the defendant or others. The reason being that it is very difficult to prove the benefit concerned, and in most "money laundering" cases, there may not be evidence to show from what indictable offence the "black money" are in fact derived. Of course, if there is information to prove that the "black money" is originated from serious crimes, including drug trafficking, kidnap and blackmail, illegal human trafficking, other organized crimes, etc. or the defendant's benefit is huge, then the sentence should be adjusted upward.[2]

19.  In determining the proper starting point, I have reminded myself of the sentencing principles laid down in HKSAR v Cen Huakuo [2015] 2 HKLRD 951.  I have also borne in mind the amount of money involved, the duration of the offences, the defendant's role in relation to the movements of funds as well as his personal circumstances.  A marked difference between the defendant in the present case and the applicant in Cen Huakuo is that the defendant is not a mainland resident who came to Hong Kong to commit crimes.

20.  For the purpose of sentencing, I accept there is no evidence showing that the defendant knew about the details of the 2 phone scams.  Even retrospectively, he probably had no more than a "sketchy idea" of the deception against PW1 and PW2.  To this extent, his culpability is perhaps less than the perpetrator(s)  of the underlying phone deception[3].  Hence, I adopt a starting point of 2.5 years' imprisonment each for Charges 2 and 4.  With the timely guilty plea, the sentence is reduced to 20 months.  Apart from this, I see no other mitigating factors which warrant any further reduction.  With the 25% enhancement, I sentence the defendant to 25 months' imprisonment for each charge.

21.  Bearing in mind the totality principle, I consider a global starting point of 39 months' imprisonment appropriate for both Charges 2 and 4.  With the timely guilty pleas, the overall sentence becomes 26 months.  With the 25% enhancement, the overall sentence becomes 32 months' imprisonment.  I note that the evidence against the defendant in Charge 2 came primarily from his own admissions.  I would therefore grant him a discount of 2 months[4], reducing the overall sentence to 30 months.  To achieve this, I order:  5 months in Charge 4 to run consecutive to Charge 2.  In other words, the total prison term for the defendant is 30 months.