HKSAR v. HAU LOK MAN

CACC 193/2024 [2025] HKCA 937

On appeal from [2024] HKDC 1319

and [2024] HKDC 1554

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO 193 OF 2024

(ON APPEAL FROM DCCC NO 881 OF 2023)

_______________

_______________

__________________________________

REASONS FOR JUDGMENT

__________________________________

1.  This case concerns a telephone deception scam. It was alleged that, on 27 April 2023, the applicant (D1) and Lee Chung Wa (D2) conspired together with other persons unknown to defraud Chan Kwok Hoi (PW1), by dishonestly falsely representing that PW1’s son was in need of money, inducing PW1 to pay HK$200,000 (Charge 1). Alternatively, it was alleged that, on 27 April 2023, D1 and D2, together with other persons unknown, attempted to deal with property, namely a sum of HK$200,000 in cash, known or believed to represent the proceeds of an indictable offence (Charge 2).[1] At the time of the offences, D1 was 15 years of age.[2]

2.  D1 and D2 stood trial before Deputy District Court Judge Francis Cheng (the judge). D1 pleaded not guilty to Charges 1 and 2, while the prosecution accepted from D2 a plea of guilty to Charge 2 and agreed not to proceed against him on Charge 1. On 8 August 2024, the applicant was convicted after trial of Charge 1. On 19 September 2024, he was sentenced to 5 years’ imprisonment.[3]

3.  On 23 September 2024, D1 applied for leave to appeal against sentence. On 20 November 2024, he was granted legal aid, and Mr H Y Wong was assigned as his counsel. The grounds of appeal against sentence alleged that:

Ground 1: the judge failed to consider the range of sentencing options as required in respect of a young offender under section 109A of the Criminal Procedure Ordinance (Cap 221);

Ground 2: the judge did not appropriately take into account when sentencing D1 that there was no evidence showing he knew about the phone scam and there was a disparity in his sentence with D2’s sentence; and

Ground 3: the sentence was manifestly excessive and wrong in principle.[4]

4.  On 9 January 2025, D1 filed an application for leave to appeal against conviction out of time, some four months late. In an affirmation explaining the delay in filing, D1 stated that his original counsel only advised him that the sentence was excessive. His current counsel, however, noted that the prosecutor did not make a closing submission on the conspiracy to defraud charge and only focused on the money laundering charge.

5.  In his written submission filed on 12 March 2025, Mr Wong explained that D1 was advised by his defence counsel after trial that the sentence was manifestly excessive. It was only after Mr Wong was assigned as his counsel for the sentencing appeal that he advised him to appeal against his conviction, on the following grounds:

Ground 1: prosecuting counsel only opened the case on Charge 2; and

Ground 2: there was insufficient circumstantial evidence to draw the irresistible inference that D1 was a party to the alleged conspiracy to defraud in Charge 1.[5]

6.  Mr Wong represented D1 at the leave hearing in respect of his applications for leave to appeal against conviction out of time and sentence.

7.  At the conclusion of the hearing, I granted D1 leave to appeal against conviction on Ground 2 and against sentence on Grounds 1, 2 and 3, upon being satisfied that they were reasonably arguable.

8.  The leave application to appeal against conviction was out of time by some four months. I accepted the explanation for the delay, which I considered to be reasonable given D1’s young age and the complexity of his case. I was satisfied that there was a substantial and plainly arguable ground of appeal in Ground 2 and that a refusal to grant an extension of time would prevent D1 from challenging his conviction on that basis. Accordingly, I granted the extension of time and leave to appeal against conviction on Ground 2, but found no merit in Ground 1.

The prosecution case

9.  On 26 April 2023, PW1 received a call from an unknown male, claiming to be his son, who said he wanted to test a new mobile telephone. On the morning of 27 April 2023, PW1 received another call from the same caller, who claimed to have been involved in a fight and needed HK$200,000 to compensate the victim. After confirming with his son in the United States, PW1 realised it was a scam and reported the matter to the police. The police then arranged a controlled meeting for PW1 to hand over the money. Later that day, the caller instructed PW1 to meet his friend “Ming Jai” outside a supermarket at Lok Tak Court, Tsuen Wan, to hand over the cash. PW1 then received a further call from a man claiming to be “Ming Jai”, who asked what clothing he was wearing to identify him. Shortly after, D1 and D2 arrived together by taxi. While D2 acted as a lookout[6], D1 approached PW1, identified himself as “Ming Jai”, and said he was there to collect the money. D1 made a call and handed the phone to PW1. Following the instructions from the person on the call, PW1 gave an envelope to D1. Both D1 and D2 were arrested at the scene.

10.  D1 stated under caution that a woman asked him to collect the money for her that day, and he would be paid wages afterwards.[7]

11.  In a cautioned video recorded interview (VRI), D1 stated that his friend Hei Chai introduced him to a woman called Yin, whom he had never met. Yin instructed him via WhatsApp to collect money for a reward and to meet a person called “Ko Lo” (D2) in Mong Kok. Yin told him that he would be paid in cash or by cheque, but did not tell him the amount. He said he did not expect to be deceived, as he believed Yin was Hei Chai’s friend. On 27 April 2023, he met D2 in Mong Kok and they took a taxi to Lok Tak Court, where D2 told him to wait outside a supermarket. D2 then instructed him via Telegram to approach PW1, identify himself as “Ming Jai”, make a phone call and pass the phone to PW1 to speak to the other party. D1 claimed he did not know PW1 and had not received any reward.[8]

12.  PW1 identified D1 as “Ming Jai”, and the arresting officer (PW2) observed the applicant contact PW1 and show him his (D1’s) phone.

The defence case

13.  D1 gave evidence but called no witnesses. His case was that he did not have any knowledge or suspicion of the fraud perpetrated on PW1. As for Charge 1, he denied any dishonesty on his part or involvement in a conspiracy. As for Charge 2, he maintained that he neither knew nor had reasonable grounds to believe that the money he collected from PW1 represented the proceeds of crime.[9]

14.  D1 testified that he was acquainted with Hei Chai, who was of similar age and whom he knew from playing basketball. In March 2023, Hei Chai offered to refer him to a job to earn money for new shoes. About a week later, Yin began contacting him via WhatsApp. On 26 April 2023, Yin instructed him to collect money for her in Mong Kok the following day and arranged for other persons to take a photograph of his identity card and to accompany him. He explained that he did not ask about the sum to be collected, as he regarded himself as a mere courier and considered the amount unimportant. He agreed to take the job, believing that Hei Chai would ensure he was paid, although Yin did not specify the amount. He said both Hei Chai and Yin had assured him that the job did not involve any unlawful activity, and that the money belonged to Yin. He claimed he had no knowledge of any fraud or wrongdoing, nor reason to suspect the money from PW1 was the proceeds of crime.[10]

15.  During cross-examination, it was put to D1 that he had deliberately turned a blind eye to the illegality of the job. He maintained that he did not find the arrangement suspicious at the time. Although he admitted feeling suspicious about posing as “Ming Jai”, he said that he did it believing he was acting on the instructions of “Ming Jai” and was collecting the money for him.[11]

The reasons for verdict

16.  The judge rejected D1’s evidence that he did not find it suspicious to collect money for a complete stranger in return for a monetary reward, notwithstanding his age at the time of the offence. The judge considered D1’s admission in the VRI that he had agreed to collect money for Yin and followed instructions to approach PW1 by claiming to be “Ming Jai”. The judge found that his act of pretending to be someone else was clearly fraudulent. He concluded that the only reasonable inference from the circumstantial evidence was that D1 was a party to the conspiracy as alleged in Charge 1, and accordingly convicted him.[12]

The appeal against conviction

Ground 1

17.  Ground 1 contended that the prosecution opened its case solely on the basis of Charge 2 and did not put to D1 in cross-examination that he knew about the phone scam alleged in Charge 1. This led the defence to conduct his case with a primary focus on Charge 2, which amounted to a material irregularity.

18.  D1 was arraigned on Charges 1 and 2 and entered a plea of not guilty on each charge. Whilst prosecuting counsel at the conclusion of his opening only set out the particulars of Charge 2, he nevertheless set out the evidence the prosecution proposed to call in support of Charge 1.[13] There was no confusion by the defence that D1 was facing Charge 1, as was apparent from the conduct of both the prosecution and the defence. At the close of the prosecution case, the judge ruled that there was a case to answer on both charges, and the defence clearly understood that they had to answer for both charges.[14] This was evident from the fact that defence counsel in his closing submission addressed in detail the legal elements and evidence regarding Charge 1.[15]

19.  This ground of appeal was without merit and plainly not sustainable.

Ground 2

20.  Ground 2 alleged that the judge, having accepted that D1 did not know about the details of the phone scam, erred in drawing the inference of guilt that he was a party to the conspiracy for Charge 1, based only on the facts that he took part in the collection of the money and pretended to be “Ming Jai”.

21.  The issue at trial was whether the evidence was sufficient to show that D1 was a party to a conspiracy to take part in the phone scam (Charge 1, conspiracy to defraud), or was merely collecting the proceeds of the scam (the alternative, Charge 2, attempted money laundering). D1’s involvement in the scam was based on his own evidence.[16] It appears that the judge relied on D1’s evidence of his participation in the collection of the money to draw the irresistible inference that he was guilty of Charge 1.[17] In contrast, the judge accepted that there was no evidence that D1 knew of the details of the phone scam.[18] This raises the question of whether there was an evidential basis on which to convict D1 on Charge 1.

22.  The respondent submitted that the central issue was whether D1 had agreed with D2 and others to pursue a course of conduct which, if carried out as intended, would constitute the phone scam against PW1 as alleged. It was argued that D1’s prior phone communications with other co-conspirators, including Yin, his proactive role in falsely claiming to be another person to PW1 at the scene, and his involvement in making a phone call to PW1 at the scene were all part of the conspiracy to defraud PW1 of his money. The respondent argued that D1 was not merely involved in the alternative money laundering charge. Accordingly, the judge was entitled to draw an inference of guilt that he was a co-conspirator to Charge 1.

23.  Charge 1 alleged a conspiracy to defraud PW1. The terms of the conspiratorial agreement were to falsely represent to PW1 that his son was in need of money, inducing him to pay HK$200,000 in cash. This offence was part of a phone scam, in which a caller, purporting to be PW1’s son, claimed that he was in a fight and needed to compensate the victim and that he would be in trouble if he did not pay. It seems that the judge found that on the evidence, D1 did not know of the phone scam, but because of his involvement in the collection of the money by passing himself off as someone else, he concluded that he was nevertheless a party to the alleged conspiracy.

24.  In examining this ground, the terms of the alleged conspiratorial agreement are key to determining whether the offence was proven. The central question is whether the evidence supported an irresistible inference that D1 was a party to the agreement to defraud PW1 of HK$200,000 by falsely claiming his son needed money.

25.  I was satisfied that Ground 2 was reasonably arguable and granted D1 leave to appeal his conviction on this ground. I directed that the Appeal Bundle include the evidence of PW1 and D1.

The appeal against sentence

26.  D1 was 15 at the time of the offence and 16 at the time of sentencing. He had been educated to Form 3 Level. He was living with his mother and was undertaking vocational training in hairdressing. He had one previous conviction for possessing articles with intent to destroy or damage property, having been sentenced to a 120-hour Community Service Order (CSO) on 18 April 2024.[19]

27.  In mitigation, defence counsel, pursuant to section 109A[20], urged the judge to consider a non-custodial sentence because of D1’s young age, and, to that end, requested a CSO report.

28.  Defence counsel submitted that D1’s role in the fraudulent enterprise was very minor, with no actual involvement in deceiving the victim; that he was exploited by others; that he acted on a momentary lapse of judgement; and that the offence involved a small sum with no actual loss or harm to PW1.[21]

29.  The prosecution applied under section 27(2) of the Organized and Serious Crimes Ordinance (Cap 455) (OSCO) for an enhancement of the sentences of both D1 and D2, which was not opposed by the defence. It was submitted that the present case fell into the category of “By Hand” and “Guess Who” telephone deception. Prosecuting counsel further cited statistics indicating a rising trend in the number of such cases and the amount of losses incurred in recent years.[22] The judge was satisfied that the OSCO application was properly made and determined that an enhancement of 25% to the starting point would be appropriate.

30.  In sentencing D1 for Charge 1, the judge noted that the CSO report found him unsuitable for such an order due to his unsatisfactory performance in respect of the previous CSO.[23]

31.  Whilst accepting that there was no evidence D1 knew the details of the phone scam and that his culpability was less than that of the perpetrators of the underlying deception, the judge found that he participated in the actual collection of money and pretended to be someone he was not in the course of collecting money from PW1. Applying the sentencing guidelines for phone deception in HKSAR v Hung Yung Chun and Another[24], the judge adopted a starting point of 4 years’ imprisonment, which he enhanced by 25% (1year) for the OSCO application, to 5 years’ imprisonment.

32.  In sentencing D2 for Charge 2, the judge adopted a starting point of 2 years and 6 months’ imprisonment, which was reduced by one third for his guilty plea and enhanced by 25% under OSCO, resulting in a sentence of 25 months’ imprisonment. As in D1’s case, the judge found D2’s culpability for Charge 2 to be less than that of the perpetrators of the underlying deception and accepted that there was no evidence he knew the details of the phone scam. In making this finding, the judge took into account the sum involved, duration of the offence, D2’s role in the movement of funds, and his personal circumstances.[25]

33.  Mr Wong complained that the judge failed to obtain sufficient reports and/or to properly consider non-custodial sentencing options applicable to young offenders (Ground 1). He submitted that the judge failed to fully consider D1’s role and to properly apportion blame between him and D2, resulting in a disparity between their sentences (Ground 2). In this regard, he pointed out that there was no evidence D1 knew the details of the phone scam, and the judge should have sentenced him under the attempted money laundering charge (Charge 2) rather than the conspiracy to defraud charge (Charge 1). He further argued that, given the age difference between D1 and D2 and D2’s admission that he acted as a lookout, D1’s culpability should not have been regarded as greater. He generally complained that the applicant’s sentence of 5 years’ imprisonment was manifestly excessive and wrong in principle (Ground 3). Regarding Ground 2, I assumed Mr Wong meant that the judge should have sentenced D1 on Charge 1 for the limited role he played in collecting the money.

34.  I was satisfied that the grounds of appeal against sentence were reasonably arguable, and accordingly granted D1 leave to appeal his sentence.

Conclusion

35.  For the reasons stated, I granted D1 leave to appeal his conviction only on Ground 2, and his sentence on all grounds advanced on his behalf.