BANCO DE CHILE v. BORUIDA TRADING CO., LTD AND OTHERS

HCA 1621/2018

[2018] HKCFI 1780

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1621 OF 2018

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DECISION

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1.  This is the plaintiff’s application by summons dated 13 July 2018 (the “Summons”) for:

 (a)  the continuation of the injunction order obtained ex parte from DHCJ Leung on 10 July 2018 (the “Injunction Order”); and

 (b)  production by Hang Seng Bank (“HSB”), Standard Chartered Bank (Hong Kong) Limited (“SCB”) and Bank of China (Hong Kong) Limited (“BOC”) of those documents set out in the Schedule to the Summons.

2.  I have read the two affirmations of Mr Hector Antonio Vallejos Stockebrand filed in support of the Summons. In summary, the plaintiff says that it is the victim of a cyber fraud. Fraudulent and unauthorized SWIFT messages were sent to instruct several banks to transfer from the accounts which the plaintiff held with those banks (“Funds”) to the bank accounts held by the 1^st, 2^nd and 3^rd defendants in Hong Kong respectively with HSB (“D1’s HSB A/C”), SCB (“D2’s SCB A/C”) and BOC (“D3’s BOC A/C”).  The defendants were first level direct recipients.  In total, US$2,009,650, €1,998,044.06 and US$1,000,206.29 were sent respectively to the accounts of D1, D2 and D3.  The matter has been reported to the Hong Kong Police.  Investigation by both the parties and the police are on-going.

3.  Mr Stockebrand has confirmed that the plaintiff has no business relationship with any of the defendants. 

4.  On 12 July 2018, a Writ was issued against the defendants.  The causes of action include unjust enrichment and constructive trust.  The claims are therefore both personal and proprietary in nature.

5.  The evidence discloses a good arguable case by the plaintiff against the defendants.  A serious risk of dissipation can clearly be inferred from the facts.  Balance of convenience favours the continuation of the Injunction Order.

6.  In so far as the application for production of documents againstthe banks is concerned, I have considered the evidence filed before this Court.  I record that the summons and all documents in support have been served not only on the defendants but on the banks concerned.  I have considered the submissions made by Mr Yu for the plaintiff.  I have considered the authorities cited in support.  I have previously, echoing the warning made in previous authorities, observed that the powers which the Court is now being invited to invoke have to be exercised with great caution.  It is important to maintain banker/customer confidence.  I have on the other hand in Akbank TAS v Mainford Limited & Ors [2018] HKCFI 363 (unreported, HCA 3264/2016, 22 February 2018) observed that Hong Kong being an international city, the law should be facilitative but not obstructive when a victim of a cybercrime comes to our courts for lawful redresses against the true culprits.  It is a balancing exercise which the Court has to undertake.

7.  In the present case, I note that there is a strong prima facie case of cyber fraud.  The scale and nature of the same as alleged are both large and sophisticated.  The defendants were first level direct recipients of the Funds.  The claims against them are therefore both personal and proprietary in nature.  The documents and information sought are clearly relevant.  They are specifically defined, both in terms of nature and duration.  They are confined to D1’s HSB A/C, D2’s SCB A/C and D3’s BOC A/C.  In respect of the use of any documents that may be disclosed, the draft order expressly specifies that they may not be used against the disclosing banks, thereby avoiding any possible concern and argument over infringing any party’s privilege against self-incrimination.  The three Banks are neutral to the application.  On the facts of this case, I am satisfied that an order in terms of the Summons should be made.  I so order.