HKSAR v. RAI PIRTAM AND OTHERS

DCCC 355, 597, 637 & 1489/2024 (Consolidated)

[2025] HKDC 1550

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO 355, 597, 637 AND 1489 OF 2024

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REASONS FOR SENTENCE

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Introduction and pleas

1.  D2, D3 and D4 each plead guilty to their respective charges of dealing with property known or believed to represent proceeds of an indictable offence, contrary to section 25(1) and (3) of the Organized and Serious Crimes Ordinance (Cap 455) (“OSCO”).

2.  The Prosecution applies for a sentence enhancement under OSCO section 27(2)(c) and (d).

Facts

3.  In relation to D2 Charge 2 (BOC XXX), between 24 November 2022 and 6 March 2023 a total of HK$3,936,430.91 was deposited by 146 deposits and withdrawn by 718 withdrawals, exhibiting mirroring and smurfing patterns. Under caution, D2 accepted lending his account to a person referred to as “Ah Lung” for reward while unemployed.

4.  In relation to D2 Charge 8 (Welab XXX), between 26 October and 1 November 2022 the account received 268 deposits totalling HK$831,957.50, followed by rapid withdrawals and low end-day balances. D2 stated that “Ah Long/Ah Lung” helped him open the account and then used it; D2 sold the account for HK$1,000.

5.  In relation to D3 Charge 3 (NCB XXX), between 27 January and 8 February 2023 HK$1,629,954.76 was deposited by 88 deposits and withdrawn by 63 withdrawals, showing mirroring.

6.  In relation to D3 Charge 4 (SCB XXX), between 10 January and 31 March 2023 HK$2,288,517.69 was deposited by 43 deposits and withdrawn by 188 withdrawals, showing mirroring and smurfing.

7.  In relation to D3 Charge 9 (DBS XXX), between 12 January and 16 May 2023 HK$130,201.02 was deposited and withdrawn in full with low residual balances. D3 told police he had been indebted to a loan-shark and surrendered accounts, cards and passwords; he then lost access.

8.  In relation to D4 Charge 5 (BOC XXX), between 30 January and 28 February 2023 HK$4,024,929.14 was deposited by 80 deposits and withdrawn by 109 withdrawals. D4 accepted the account was his.

9.  In relation to D4 Charge 10 (SCB XXX), between 1 February and 4 August 2023 HK$3,088,090.64 was deposited by 84 deposits and withdrawn by 264 withdrawals; the balance was zero by 4 August 2023. D4 accepted the mandate information was his and acknowledged receiving SCB notifications.

10.  In relation to D4 Charge 7 (failing to surrender to lawful custody), after first appearance on 24 January 2024 D4 failed to attend on 12 March 2024. A warrant issued was executed on 18 April 2024. Under caution he said he had forgotten the date.

Enhancement of sentence

11.  The Prosecution seeks enhancement under s.27(2)(c) (prevalence) and (d) (harm). The defence does not oppose an enhancement in principle.

12.  As to s.27(2)(c), the data in Chief Inspector LI Yiu-nam’s statement (25 August 2025) show that the use of stooge/mule accounts has become a prevalent modus operandi: the proportion of arrestees identified as stooges rose from 31.38% (2020) to 75.10% (2024), with 71.46% in the first 7 months of 2025; reported case numbers increased from 16,643 (2020) to 47,063 (2024). I am satisfied that these offences fall squarely within that prevalent pattern and that an uplift is justified on this ground.

13.  As to s.27(2)(d), while historic losses have been substantial, the most recent figures suggest a downward trajectory and, on the present material, I am not persuaded to enhance separately for harm under paragraph (d).

14.  Having considered all the circumstances, I allow a 25% enhancement under s.27(2)(c) only.

Mitigation of D2

15.  D2 is 54, Hong Kong-born, married in 1995 with two sons, separated since 2007, and has experienced homelessness since 2008 while surviving on casual work without claiming CSSA. His offending is linked to longstanding addiction; he engaged in rehabilitation with Yang Memorial from 2013 and Operation Dawn in 2014–2018 and 2018–2022; he briefly reconciled with family around October 2021 and relapsed in mid-2022.

16.  His role was that of a stooge account holder, lending or selling accounts for modest rewards (HK$3,000 for Charge 2; HK$1,000 for Charge 8), with no knowledge of the predicate fraud and no organisational responsibility.

17.  He has 8 previous convictions (5 drug-related). On 20 February 2024, in KTCC 2409/2023, he was sentenced to 10 months for a related laundering matter. The materials indicate that case arose in substantially the same setting and period, involving about HK$1.228 million. In applying totality, I have regard to that overlap.

18.  The defence invites this Court to take a global assessment across Charges 2 and 8, using the aggregate of HK$4,768,388.41 when fixing the starting point.

Mitigation of D3

19.  D3 is 38, moved from Shenzhen to Hong Kong at 13, completed junior secondary education, has a clear record, and supports his wife, 11-year-old son and 61-year-old mother. He worked as a construction slinger (about HK$1,500/day) and is now a casual transportation worker (about HK$19,000/month).

20.  The offences followed a sharp reduction in income during the pandemic, mounting debts and overdrafts, and the unavailability of bank credit. In mid-2022 he borrowed HK$100,000 from a loan shark, fell into arrears and, under pressure, surrendered his NCB and SCB accounts and later opened a DBS account at the lender’s request, handing over cards, PINs and online passwords; he then lost access and did not operate the accounts.

21.  His role was limited to providing accounts in exchange for debt write-off; he derived no meaningful profit and had no knowledge of the predicate fraud. The sums were HK$1,629,954.76 (Charge 3), HK$2,288,517.69 (Charge 4) and HK$130,201.02 (Charge 9), with mirroring/smurfing and rapid withdrawals by others.

22.  The defence relies on totality, seeking substantial concurrency because the counts formed a connected course of conduct within a short timeframe and shared the same modus operandi.

Mitigation of D4

23.  D4 is 50, completed junior secondary education, and has 4 previous convictions, none of which involve money laundering or fraud.

24.  He is single, the youngest and only son among 8 siblings, and has long lived with and supported his 84-year-old mother, working as a cleaner (about HK$10,000/month). His mother suffers from severe diabetes and hypertension, is wheelchair-bound, and has forthcoming medical appointments (19 September, 15 October and 24 November 2025), which he used to attend with her.

25.  The offences began when an acquaintance introduced “Ah Lung”, who sought to use D4’s bank accounts to facilitate deposits and withdrawals. D4 handed over cards and passwords for his BOC and SCB accounts, receiving about HK$6,000. He did not know the victims or the predicate crimes, and he did not himself conduct the transactions, notwithstanding bank statements or notifications.

26.  Charge 5 spans roughly 1 month and Charge 10 about 6 months; there is no international element; the modus was relatively unsophisticated and consistent with a stooge-account role.

27.  For Charge 7, D4 says he failed to attend court because he forgot the date and he did not intend to abscond or commit any further offences while absent.  He was arrested about a month later, and cooperated thereafter.

28.  The defence seeks substantial concurrency between Charges 5 and 10 and, so far as appropriate, concurrency for Charge 7, and asks for the most lenient sentence consistent with deterrence.

Sentencing considerations

29.  The maximum for OSCO s.25 offence is 14 years’ imprisonment. The Court of Appeal has emphasised that the amount laundered is a major consideration, alongside role, knowledge, number of transactions, duration, sophistication, international dimension and syndication (HKSAR v Hsu Yu Yi [2010] 5 HKLRD 545; HKSAR v Boma Amaso [2012] 2 HKLRD 33).

30.  As to starting points by amount, indicative ranges include around 3 years where the “black money” is HK$1–2 million; around 4 years where it is HK$3–6 million; and over 5 years where it is above HK$10 million (Secretary for Justice v Wan Kwok Keung [2012] 1 HKLRD 201). They are non-exhaustive and subject to the features in each case.

31.  On concurrency for absconding, the general rule is that a sentence for failing to surrender should be consecutive to mark the distinct harm to the administration of justice unless the substantive sentence is already very long so as to make a further consecutive term unnecessary (HKSAR v Lo Kam Fai CACC 374/2014).

Sentencing D2

32.  For Charge 2 (HK$3.936 million, BOC), I take a starting point of 48 months. After the one-third discount for the guilty plea, the sentence becomes 32 months. I then apply a 25% enhancement under section 27(2)(c), which results in a term of 40 months.

33.  For Charge 8 (HK$0.832 million, WeLab), I take a starting point of 24 months. After the one-third discount for guilty plea the term becomes 16 months, and after a 25% enhancement it becomes 20 months.

34.  Applying the totality principle, I adopt Charge 2 as the anchor at 40 months. I order 4 months of the sentence on Charge 8 to run consecutively, with the balance to run concurrently. The total sentence for D2 shall be 44 months’ imprisonment. Yet this is not the end of the matter.

35.  In respect of KTCC 2409/2023, I understand that it had been fully served. Despite that, it is only fair to reflect totality across proceedings. There are various ways to achieve that. My idea is to reduce the sentence of Charge 2 by 4 months, i.e., from 40 months to 36 months.  As a result the total sentence for D2 in the present case is 40 months.

Sentencing D3

36.  For Charge 4 (HK$2.289 million, SCB), I take a starting point of 36 months. After the one-third discount for guilty plea the sentence is 24 months, and after a 25% enhancement it becomes 30 months.

37.  For Charge 3 (HK$1.630 million, NCB), I take a starting point of 30 months. After the one-third discount for guilty plea the sentence is 20 months, and after a 25% enhancement it becomes 25 months.

38.  For Charge 9 (HK$0.13 million, DBS), I take a starting point of 12 months. After the one-third discount for guilty plea the sentence is 8 months, and after a 25% enhancement it becomes 10 months.

39.  Applying the totality principle, I adopt Charge 4 as the anchor at 30 months. I order 8 months of the sentence on Charge 3 and 2 months of the sentence on Charge 9 to run consecutively, with the balance to run concurrently. The total sentence for D3 is therefore 40 months’ imprisonment.

Sentencing D4

40.  For Charge 5 (HK$4.025 million, BOC), I take a starting point of 48 months. After the one-third discount for guilty plea the sentence is 32 months, and after a 25% enhancement it becomes 40 months.

41.  For Charge 10 (HK$3.088 million, SCB), I take a starting point of 48 months. After the one-third discount for guilty plea the sentence is 32 months, and after a 25% enhancement it becomes 40 months.

42.  For Charge 7 (failing to surrender), I take a starting point of 12 weeks. After the one-third discount for guilty plea the sentence is 8 weeks. No section 27 enhancement applies to this offence.

43.  Applying the totality principle, I adopt Charge 5 as the anchor at 40 months. I order 12 months of the sentence on Charge 10 to run consecutively, with the balance to run concurrently. I further order the eight-week sentence on Charge 7 to run consecutively to mark the distinct harm to the administration of justice. For clarity, treating 8 weeks as 2 months, the total term for D4 is 54 months’ imprisonment.