HKSAR v. CHOI CHOR CHUEN

DCCC 539/2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL ACTION NO 539 OF 2013

---------------------

---------------------

--------------------------------------

REASONS FOR SENTENCE

--------------------------------------

Overview

1.  The defendant pleaded guilty to an offence of forgery, contrary to section 71 of the Crimes Ordinance, Cap 200 and an offence of fraud, contrary to section 16A of the Theft Ordinance, Cap 210.

2.  In summary, the offences were arising from a loan application in which the defendant falsely represented his personal background and financial status, and provided bogus bank passbook records.  In the result, a loan of HK$880,000 was granted to him.

The facts

Charge 2

3.  On 22 June 2012, the defendant opened a bank account with Standard Chartered Bank (Hong Kong) Limited (“SCB”).

4.  On 30 June 2012, he applied for a personal loan of HK$880,000 via the telephone hotline of SCB (“the Application”).  He then falsely furnished the following particulars: he had been working in “Sun Hung Kee Group” for about 20 years; he was the President/Chairman of the company earning an annual income of HK$1,062,000; his education level was up to university.

Charge 1

5.  On about 6 July 2012, the defendant faxed the photocopies of his HKID card and two pages of his HSBC savings account passbook to SCB in support of the Application.  The said passbook purportedly showed that his monthly salary was HK$88,500.

6.  In reliance of the false particulars and the bogus passbook records, the Application was approved and a sum of HK$840,400 (ie HK$880,000 less administration fee) was deposited into the defendant’s SCB account on 2 August 2012.

7.  On 23 August 2012, SCB received a complaint from the defendant alleging that sums of money had been transferred out of his SCB’s account for unknown reasons.  Upon investigation, SCB discovered that there were discrepancies in the particulars provided by him.  A report was subsequently made to the police.

Arrest and confessions

8.  On 4 March 2013, the defendant was arrested.  Under caution, he admitted that he was a construction site worker who was educated up to primary level and cannot read and speak English.  He also admitted the offences and explained that he was taught by a friend nicknamed “Ah Long” as to how to use computer to make the bogus passbook records.  He had spent a total of about HK$400,000 for his own use and repayments of debts.  His girlfriend who did not know that loan was fraudulently obtained had spent about HK$110,000 to HK$120,000.

Mitigation

9.  The defendant is now 59 years of age, married.  He previously worked as a cleaner earning about HK$6,000.  His wife now aged 60 is in court today.  He committed the offences out of greed.  He is now very remorseful.

10.  In mitigation, I am told that a sum of HK$300,000 was being transferred out of his SCB’s account by others for unknown reasons.  He suspected that it was due to the loss of his bank card in mid of August 2012.  In other words, no compensation can be offered to the victim.

11.  He has 16 criminal convictions, 9 of which are drug-related but none of them is similar to the present offences.

Sentence

12.  There is no sentencing tariff for these offences.  Each case has its own facts.  The seriousness of these offences lies in the fact that they will undermine the integrity of our banking system.  In the loan application of this kind, banks will mainly rely upon the honesty and discipline of applicants.  A sentence of deterrent effect is called for so as to deter like-minded offenders who intend to practice fraud on banks or financial institutions.

13.  In the present case, the defendant verbally furnished false information at the outset of the application.  He then fabricated his documentary income proof by altering the passbook records.  In my view, these offences were premeditated.

14.  In HKSAR v Li Po Ying CACC105/ 2001, the Court of Appeal stated that:-

“it must be made clear nonetheless that calculated and well planned offences of this kind, involving substantial frauds on banks, will be met with imprisonment even in the case of first offenders, and that the terms are likely to be significant. The deterrent element, and the public interest, so require.” (paragraph 21 of the Judgment)

15.  In Li’s case, the applicant who was of previous good character fraudulently obtained mortgage loans in a total of about HK$350,000 by putting up a property which was jointly owned by her and her husband as security.  A forged ID card was used to deceive the solicitors of the finance company in order to conceal the fact that her husband had not authorized the transaction. The victimized finance companies eventually suffered no loss when the property was realized in default of repayment.  The Court of Appeal approved that the first two offences merited a starting point each of 2 years whilst the third charge of conspiracy to forgery warranted a starting point of 2½ years, noting the risk of future use and circulation of the forged card in question.

16.  In the present case, I accept that the fraudulent scheme was less complicated as that in Li’s case.  However I cannot lose sight of the fact that the loss suffered by SCB was substantial.

17.  Having considered everything urged upon me in mitigation, submissions and all the circumstances, I adopt a starting point of 18 months’ imprisonment for Charge 1 and 2½ years for Charge 2.  To reflect his guilty plea, the sentence of Charge 1 is reduced to 12 months and Charge 2 is 20 months.  Apart from that, I see no other mitigating factors which warrant any further discount.

18.  As to totality, I accept that the offences were part and parcel of the same transaction.  I therefore order that the sentences be run concurrently.

19.  Accordingly, the defendant is sentenced to 20 months’ imprisonment.