DCCC1030/2024

DCCC1030/2024

A A B B DCCC 1030/2024 C [2025] HKDC 2052 C D D IN THE DISTRICT COURT OF THE E HONG KONG SPECIAL ADMINISTRATIVE REGION E CRIMINAL CASE NO 1030 OF 2024 F F G --------------------------- G HKSAR H H v I LI Ho-yin I ---------------------------- J J K Before: Deputy District Judge May Chung K Date: 2 December 2025 L L Present: Mr Jacky Lam, Public Prosecutor, for HKSAR M Mr Emma TC Tsang, instructed by Messrs A Lee & Partners, M assigned by DLA, for the defendant N N Offences: [1] & [2] Dealing with property known or believed to O represent the proceeds of an indictable offence (處理已知道 O P 或相信為代表從可公訴罪行的得益的財產) P Q Q R ----------------------------------------- R REASONS FOR SENTENCE S S ----------------------------------------- T T U U V V  -2- A A B B 1. The defendant (“D”) pleaded guilty to two counts of dealing C with property known or believed to represent the proceeds of an indictable C offence (“money laundering offence”), contrary to sections 25(1) and (3) D D of the Organized and Serious Crimes Ordinance, Cap. 455 (“the E Ordinance”). E F F Facts G G 2. The facts of the case are set out in the Amended Summary of H H Facts; I shall not repeat the same in detail herein. I I 3. In gist, D was the sole signatory of the bank account in Charge J J 1 at China CITIC Bank (“Account 1”) and the bank account in Charge 2 K PAO Bank (“Account 2”). Between 21st December 2022 and 31st January K 2023, a Ms Lai fell for a fraudulent investment scheme and she was enticed L L by a fraudster to remit money to a bogus website for purported investments M in cryptocurrency; she suffered a total loss of over HK$9 million, among M which HK$163,200 was dissipated in a single transaction to Account 1 on N N 11th January 2023; a second victim, a Ms Lui, suffered a total loss of around O HK$1.7 million, among which HK$290,000 was dissipated in 2 O transactions to Account 2 on 9th and 10th January 2023. P P Q 4. Investigation revealed that: Q R R (1) Account 1 had been opened by D on 21st December S 2022 and closed on 27th February 2023; between 5th S January 2023 and 27th February 2023, a total of 28 T T deposits totaling HK$2,043,689 were deposited into U U V V  -3- A A B B the account, and a total of 28 withdrawals totaling C around the same amount were withdrawn; as at 27th C February 2023, Account 1 had a closing balance of nil. D D E (2) Account 2 had been opened by D on 29th December E 2022; between 5th January 2023 and 2nd February 2023, F F a total of 25 deposits totaling HK$947,417.32 were G deposited into the account, and a total of 23 G withdrawals totaling around the same amount were H H withdrawn; as at 2nd February 2023, Account 2 had a I closing balance of HK$99.32. I J (3) At all material times, Accounts 1 and 2 had been used J as temporary repositories of funds. K K L 5. D was arrested on 4th October 2023 and 7th November 2023 L for Charges 1 and 2 respectively. He remained silent under caution. M M N N 6. D agrees that he, together with persons unknown, knowing or O having reasonable grounds to believe that the monies deposited into O Accounts 1 and 2 in whole or in part, directly or indirectly represented P P proceeds of an indictable offence, dealt with the said property. Q Q The prosecution’s application under section 27 of the Ordinance (“P’s s27 R R Application”) S S 7. The offence of money laundering is a specified offence within T T the meaning of the Ordinance. The prosecution has furnished information U U V V  -4- A A B B pursuant to section 27(2) of the Ordinance regarding: (1) the prevalence of C the offence (specifically, the prevalence of the use of stooge accounts in C the commission of the offence of money laundering); and (2) the nature D D and extent of any harm (whether direct or indirect) caused to the E community by recent occurrences of this offence. E F F 8. According to the statement of Chief Inspector Li dated 27th G November 2025, many money laundering stooges in Hong Kong “sell” or G “lend” their accounts at financial institutions to criminals for money H H laundering purposes. Most of them would allow criminals to have full I access and control of their accounts. The anti-money laundering regime in I Hong Kong is hampered by the prevalence of stooges for money J J laundering activities; the prevalence of stooge accounts interferes with the K normal operation of the banking system, and has a negative effect on the K reputation of Hong Kong as a well-known international financial hub; the L L prevalence of stooge accounts substantially facilitates the commission of M crimes and in turn leads to more crimes being committed as the mastermind M could easily evade criminal liability. The use of stooge remains prominent, N N with a rising trend in its use from 31.38% recorded in the year 2020 to O 75.10% recorded in 2024 (see Table A of Chief Inspector Li’s statement). O P P Background and mitigation Q Q 9. D is 54 years of age, single and resides alone. He was R R unemployed at the time of the commission of the present offences. S S T T U U V V  -5- A A B B 10. He had 18 conviction records prior to the offence dates C consisting of 29 charges, 11 of which is dishonesty-related. This is his first C time committing the offence of money laundering. D D E 11. The authorities cited by the defence include HKSAR v Boma E [2012] 2 HKLRD 33 and HKSAR v Wan Kwok Keung [2012] 1 HKLRD F F 201. G G 12. It is submitted that in this case: H H I (1) D lent his bank accounts to a friend and received no I remuneration for doing so. He had no knowledge of, J J nor played a part, in any predicate offence. He had no K knowledge and/or control of (i) the amount of money K involved; (ii) the sophistication of the offence, L L including the degree of planning; and (iii) the fact that M the offences concerned multiple transactions, involving M multiple victims. N N O (2) There is no evidence in the present case showing that O except for the HK$163,200 from the first victim, Ms P P Lai, and HK$290,000 from the second victim, Ms Lui, Q (totaling $453,000) the funds received by D’s accounts Q were related to any specific predicate offence. R R S (3) The offences do not concern any international element. S T (4) The sums of money went through D’s accounts within T a period of less than two months. U U V V  -6- A A B B (5) D was asked by the same person to open the two C C accounts. The offences are very similar in nature, and D the movement of money in the accounts occurred D during a similar time frame. The offences significantly E E overlap in nature, and the sentences should run wholly F concurrently. Alternatively, the Court is invited to have F regard to the totality principle in arriving at a global G G sentence that avoids an excessive or crushing H punishment, and which reflects D’s overall culpability. H I I (6) D has reflected and learned from his mistakes and J assures that he will not re-offend. He asks for the J Court’s leniency. (It should be noted that D has K K retracted his mitigation letter.) L L (7) The Court is urged to adopt an overall starting point of M less than 4 years’ imprisonment and to give a 1/3 M discount for D’s timely plea. N N O (8) Regarding P’s s27 Application, the defence submits in O written submissions that the prosecution bears the P P burden of proof in establishing the prevalence of the Q offence, and the power to enhance sentence has been Q described by courts as an exceptional power to be used R R sparingly, citing HKSAR v Li Kin Keung [2012] 4 S HKLRD 135. It is submitted that the high starting point S adopted in money laundering cases already contains T T within it a substantial element of general deterrence. A U U V V  -7- A A B B further enhancement of sentence would be tantamount C to a double enhancement. However, the defence in oral C submissions stated that D does not object to P’s s27 D D Application, but urges the Court to adopt an E enhancement of 20-25% rather than a higher E percentage. F F G Sentence G H H 13. I have considered the facts of the case, the mitigation put forth I by the defence and the case authorities. I J J 14. In HKSAR v Hsu Yu Yi [2010] 5 HKLRD 536, the Court of K Appeal stated that: K L “9. There are no sentencing guidelines for the offence of dealing L with the proceeds from an indictable offence because the facts M M vary from case to case. However the following factors are to be taken into account when determining sentence: N N O (1) It is the amount of money involved that is a major O consideration and not the amount of benefit received by a P defendant in the transaction. P Q Q (2) The culpability of the offence lies in the assistance, support R and encouragement offered to the commission of an indictable R offence. So a defendant's level of participation and the number S S T T U U V V  -8- A A B of occasions on which he is involved in the ‘money laundering' B activities are relevant factors to be considered. C C D (3) The offence of dealing with the proceeds from an indictable D offence does not necessarily have any direct correlation with the E indictable offence in question. However if the relevant E indictable offence can be identified, the court may take into F F account the sentence imposed on the indictable offence per se when determining the sentence of the dealing offence. G G H (4) If the case has an international element involving activities H carried out across different regions, the court may impose a more I severe sentence. This is to protect Hong Kong's reputation as an I international finance and banking hub from being tarnished. J J K (5) The length of time the offence lasted.” K L L 15. In HKSAR v Wan Kwok Keung [2012] 1 HKLRD 201, the M M Court of Appeal further stated that: N N “12. ‘Money laundering’ is a serious offence for not only does it O encourage criminal activities indirectly, but also attempt to O legitimize the proceeds of crime. In order to crack down on P P serious crimes, to prevent offenders from getting financial gains, it is necessary to deter the commission of the ‘money laundering’ Q Q offence (See Court of Appeal cases HKSAR v Javid Kamran R (CACC 400/2004), HKSAR v Xu Xia Li and another [2004] 4 R HKC 16, etc.). S S 13. Generally, the sentence for ‘money laundering’ offence T T should mainly reflect the amount of ‘black money’ laundered U U V V  -9- A A B and not the benefit obtained by the defendant or others. The B reason being that it is very difficult to prove the benefit C C concerned, and in most ‘money laundering’ cases, there may not D be evidence to show from what indictable offence the ‘black D money’ are in fact derived. Of course if there is information to E prove that the ‘black money’ is originated from serious crimes, E including drug trafficking, kidnap and blackmail, illegal human F F trafficking, other organized crimes, etc. or the defendant’s benefit is huge, then the sentence should be adjusted upward. G G H 14. This Court has, in a number of other similar cases, also listed H others factors relevant to the sentence to be imposed including I the number of offences, the length of time the offence lasted, the I degree to which the defendant participated in the offence J J involving ‘black money’ and whether or not it was an organised K and sophisticated crime, etc. K L 15. In HKSAR v Hsu Yu Yi [2010] 5 HKLRD 536, Cheung JA L set out the amounts of money involved and the sentences passed M M in a number of ‘money laundering’ cases. The sentencing N starting point is 3 years or so where the ‘black money’ involved N is between 1 million and 2 million dollars, 4 years or so where it O is between 3 million and 6 million dollars, and could be over 5 O years where it is above 10 million dollars.” P P Q Q R R S S T T U U V V  - 10 - A A B B 16. In HKSAR v Boma [2012] 2 HKLRD 33, the significant C features (other than the amount of “illicit money” involved) which the court C should take into account were set out to be as follows: D D E (1) The nature of the predicate offence, if known, and the penalty E available for the predicate offence … F F (2) … the state of knowledge of the offender. This divides itself G G in two – knowledge of the nature of the predicate offence, where the predicate offence is known to the court; and knowledge of H H the fact that the funds are the proceeds of an indictable I offence … I J (3) An international dimension will always be a significant J aggravating feature … K K (4) The sophistication of the offence is always relevant. This will L L include the degree of planning and whether deceit is practised to M achieve the objective. M N (5) Where the offence is committed by or on behalf of an N organized criminal syndicate, that is an aggravating fact. O O P (6) It is relevant to take into account whether there is one P transaction or many and the length of time over which the Q offence was committed. Q R R (7) … it will be an aggravating feature where the offender continues to launder funds after he has discovered as a fact that S S T T U U V V  - 11 - A A B the funds are the proceeds of an offence or after he has B discovered the nature of an offence which is serious. C C D (8) The sentencing court should have regard to the role of the D offender and the acts performed by him. In this regard, the E director of a laundering operation or scheme should attract a E greater sentence than a person engaged by him although F F sentences should be sufficient to deter those who might be prevailed upon by directing minds. In the case of a person down G G the chain, the court will wish to have regard to whether a benefit H has been received and if so the nature and size of the benefit. But H within the category of persons down the chain there will I gradations of culpability. So for example the drug addict or petty I crook who is paid a small sum to open an account and hand over J J its operation to another with no more participation and no more K knowledge than that it is going to be used for some sort of crime K is much less culpable than an offender of a different sort not L ‘used’ in that way.” L M M 17. In Secretary for Justice v Ngai Fung Sin Apple [2013] 5 N HKLRD 95, the Court of Appeal reiterated that: N O “43. This Court has on many occasions repeated the warning O that ‘money laundering’ is a very serious crime. One of the P P reasons is that in a modern society perpetrators of serious crimes Q are very often motivated by financial gains, so that to combat the Q crime of ‘money laundering’ can be an effective measure against R such serious crimes. R S S 44. Generally speaking, the sentence passed in a ‘money laundering’ case is primarily to reflect the amount of the T T ‘illicit/black money’ involved. Neither the fact that the U U V V  - 12 - A A B ‘illicit/black money’ was actually not derived from an indictable B offence nor the defendant’s ignorance of the actual source of the C C ‘illicit/black money’ is necessarily a valid mitigating factor. On D the other hand, if there is evidence which can prove from what D serious crimes the ‘illicit/black money’ was derived and if the E defendant was aware of the origin of the ‘illicit/black money’, E that would be an aggravating factor (see Secretary for Justice v F F Lau Man Ying [2012] 4 HKLRD 429 and HKSAR v Xu Xia Li & Anor [2004] 4 HKC16). Based on the same rationale, the fact G G that the defendant of a ‘money laundering’ case has not obtained H any financial benefit is not a mitigating factor.” H I I 18. This case involves 2 charges of money laundering through 2 J different bank accounts. The duration of Charge 1 was around 2 months J th th (from 5 January 2023 to 27 February 2023) and involved around HK$2 K K million; the duration of Charge 2 was around 1 month (from 5 th January L 2023 to 2nd February 2023) and involved around HK$947,000. The “illicit L money” was at least partly from online (cryptocurrency) investment M M fraudulent schemes, which must involve a certain amount of organisation N and planning. I agree that in this case, there is no evidence to indicate D N participated in the fraud or that the case involved any international element; O O D’s role was lending/selling his accounts to be used by others. However, it P must be noted that although the defence argues that the facts only show P part of the total sums were proceeds of fraud, case authorities clearly state Q Q that neither the fact that the illicit money was actually not derived from an R indictable offence nor D’s ignorance of the actual source of the money is a R mitigating factor; the fact that D has not obtained any financial benefit (or S S only a minimal benefit) is not a mitigating factor either. I do accept that as T money laundering cases go, this is not the most serious of its kind. T Nonetheless, the number of deposits into Accounts 1 and 2 totaled over 50; U U V V  - 13 - A A B B thus it can be inferred that the number of victims involved is not C insignificant. C D D 19. Although D is not of clear record, he does not have any similar E criminal conviction record. I shall not take into account his record when E sentencing him. He has pleaded guilty and shall be given the full 1/3 F F discount for his plea. I do not find that there is any other mitigating factor G in the case to further reduce his sentence. G H H 20. As to P’s s27 Application, I accept that the offence in the two I charges is a specified offence under the provision, and since 2020 the I offence (in particular, using stooge accounts to commit the offence of J J money laundering) has been prevalent, and has caused harm to the K community. I do not agree with the defence that an enhancement of K sentence under this provision “would be tantamount to a double L L enhancement” – the enhancement is related to the prevalence and the nature M and extent of the harm of the offence and not the role or the particular M circumstances of D (see HKSAR v Wong Ming Chun (CACC 31 & N N 32/2024)). It must also be emphasised that according to HKSAR v Xu Mai- O qing (CACC 464/2005): “what the prosecution has to prove is the O prevalence of the offence, not the increase in the number of such offences.” P P Q 21. Having considered the submissions of parties and the Q statement of Chief Inspector Li, I accept that the relevant information R R shows that despite the police having spent ample resources on crime S prevention, advertising and warning people not to “sell” or “lend” their S bank accounts to others and being lured into committing the specified T T offence, the offence of money laundering, and specifically the use of stooge U U V V  - 14 - A A B B accounts to commit the offence, remains prevalent, and still causes C significant harm to the community. Given that the information shows that C the number of cases (the total number of stooges arrested) increased from D D 2020 to 2024 but slightly decreased in 2025 (see Table A of Chief Inspector E Li’s statement), I am of the view that the appropriate degree of E enhancement is 1/4. F F G 22. In light of the above, I am of the view that the appropriate G sentences for the 2 charges are as follows: H H I (1) Charge 1: Starting point of 30 months’ imprisonment, I reduced by 1/3 on account of D’s guilty plea to 20 J J months’ imprisonment, and enhanced by 1/4 in light of K s27 of the Ordinance to 25 months’ imprisonment. K L L (2) Charge 2: Starting point of 24 months’ imprisonment, M reduced by 1/3 on account of D’s guilty plea to 16 M months’ imprisonment, and enhanced by 1/4 in light of N N s27 of the Ordinance to 20 months’ imprisonment. O O 23. I am of the view that in all the circumstances of the case and P P bearing in mind the principle of totality, a term of imprisonment of 30 Q months is sufficient to reflect the culpability of D in the case (in essence, Q adopting an overall starting point of 3 years’ imprisonment, reduced to 2 R R years due to D’s guilty plea, and enhanced by 1/4 in light of s27 of the S Ordinance). As such, I shall order 5 months of the sentence in Charge 2 to S be consecutive to the sentence in Charge 1. T T U U V V  - 15 - A A B B 24. D is sentenced to 30 months’ imprisonment. C C D D E E ( May Chung ) F F Deputy District Judge G G H H I I J J K K L L M M N N O O P P Q Q R R S S T T U U V V