Case Detail

HCCC 115/2021

[2024] HKCFI 3533

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 115 OF 2021

________________________

	HKSAR
	v
	SIT YI KI	1^st Defendant (D1)
	LAM WING KI	2^nd Defendant (D2)
	TAM CHEUK HANG	3^rd Defendant (D3)

________________________

Before:

The Honourable Mr. Justice D. Yau

Date of Hearing:	22 April 2024
Date of Ruling:	23 April 2024
Date of Reasons for Rulings:	6 December 2024

________________________________________________________________________

REASONS FOR RULINGS ON D1’S APPLICATION FOR FURTHER AND BETTER PARTICULARS; AND
FOR AN INDICATION FROM THE COURT TO THE PROSECUTION TO AMEND THE INDICTMENT

________________________________________________________________________

1. The defendants were convicted after trial of one joint count of “conspiracy to carry out false trading”, contrary to sections 295(1), (6) and 303(1) of the Securities and Futures Ordinance, Cap 571 (“SFO”), and sections 159A and 159C of the Crimes Ordinance, Cap 200. A full summary of the facts is set out in the Reasons for Sentence.

2. D1 applied for further and better particulars of the count at trial, as well as an indication from the court that the prosecution should amend the indictment so as to reflect the possibility of there being a parallel but separate conspiracy between Nelson Chan and Suen Man that did not involve D1, D2 or D3.

3. I refused both the applications. These are my reasons.

D1’S APPLICATION FOR FURTHER AND BETTER PARTICULARS

4. D1’s application for further and better particulars related specifically to the provision of particulars on whether holders of the 156 securities trading account, be it a person or a corporation, were co-conspirators. If so, it was D1’s submission that they should all be named as such in the indictment.

5. The prosecution refused to provide the particulars on the ground that they were not able to do so. They did not have sufficient information on who inserted the 30,000 odd orders via the internet in the 6-month charge period using those securities accounts, and so are unable to say if the 156 account holders were in fact the persons or entities who inserted the trade orders on instructions of the co-conspirators, or if the trading was handed over to be conducted by someone other than the account holders.

6. This lack of evidence was the reason why those account holders were not named in the indictment as co-conspirators.

7. D1 also mentioned a Lau Yik Kwan (“Lau”) in their application, saying that the opening speech of the prosecution seemed to suggest that Lau had a significant role to play in the global conspiracy involving all the named co-conspirators, and as such, Lau ought himself to have been named in the indictment as a co-conspirator.

8. The prosecution’s response was that there was insufficient evidence that Lau was involved in the conspiracy. The evidence suggested that Lau was not the real owner of the Mighty Edge shares under his name. A declaration of trust of those shares being held on behalf of Isidor Subotic, someone linked to Eden Investment, the company that provided $16 million to Nelson Ho and Suen Man to put in motion the false trading Action Plan was found in D1’s residence. There was also evidence of money going back to Eden via D3’s account after the collapse of Ching Lee shares.

9. Therefore, other than Lau’s overt acts, the prosecution would not be able to prove how much knowledge Lau had in relation to the conspiracy. Those were the reasons why Lau had not been named as a co-conspirator in the indictment.

10. Having heard parties, I accepted the submissions of the prosecution and found that there were no further and better particulars that could be provided as sought. I also found that D1’s right to a fair trial will not be prejudiced in any way even if the sought particulars were not given.

11. I, therefore, refused D1’s application for further and better particulars.

D1’S APPLICATION FOR AN INDICATION FROM THE COURT FOR THE PROSECUTION TO AMEND CHARGE

12. D1’s other application was for the court to indicate to the prosecution that they should amend their indictment, or include an alternative count, so as to avoid a potential duplicitous charge being laid.

13. It was D1’s submissions that in addition to the allegation that D1, D2, D3, Nelson Ho and Suen Man belonged to a global conspiracy, there was a possibility that the evidence showed that there was a second, different and distinct conspiracy just between Nelson Ho and Suen Man. If the jury eventually found that there was such a separate conspiracy between Nelson Ho and Suen Man that did not involve D1, D2 or D3, and if there was no alternative count for that separate and distinct conspiracy, D1 was of the view that the jury may wrongly convict D1, D2, or D3.

14. With the potential of there being two conspiracies, Mr. Li for D1 said that the charge is “potentially duplicitous” and asked the court to indicate to the prosecution that they should include a separate charge for the Nelson Ho and Suen Man conspiracy.

15. Upon my inquiry, Mr. Li accepted that this court did not have the power to order the prosecution to lay a particular charge or to amend a charge in a particular way, or to add an alternative count. Be that as it may, Mr. Li said the court could, and should, give such an indication, and the prosecution will have to suffer the consequences should they choose to ignore that indication. Mr. Li said this: “As to potential duplicity, the prosecution can make their case clearer by pleading their case, if they decide not to go for separate conspiracies, we wish the prosecution to make it clear at this stage.”

16. Mr. Derek Chan S.C. did make clear by giving a short and definitive answer: “Yes, we are alleging a global conspiracy, and not charging a smaller one.” It was the prosecution’s position that if D1 can convince the jury by making submissions based on the evidence placed before the jury by the prosecution (not in any way suggesting a reversal of the burden of proof) that there is a smaller conspiracy distinct and independent to the global one, then the defendants should be entitled to an acquittal.

17. Having heard submissions, I found that if it is the prosecution’s case that there had been only one global conspiracy, then it was open for them to bring the prosecution and frame the charge accordingly, and to try to prove their case on that basis and to suffer the consequences.

18. As such, I refused D1’s application for the indication they sought.

	(Douglas Yau)
	Judge of the Court of First Instance of the High Court

Mr. Derek Chan SC and Mr. Peter Chiu, Counsel on fiat, for the Prosecution/ HKSAR

Mr. Marco Li, Mr. Melvin Ho and Ms. Rachel Ronald instructed by Messrs. Littlewoods, for the 1^st Defendant

Mr. Tony Ko, Ms. Dorothy Cheung, instructed by Messrs. T H Chan & Co, for the 2^nd Defendant

Mr. Bernard Mak and Ms. Candice Lau, instructed by Messrs. Michael Li & Co, for the 3^rd Defendant

HCCC 115/2021

[2024] HKCFI 3532

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 115 OF 2021

________________________

	HKSAR
	v
	SIT YI KI	1^st Defendant (D1)
	LAM WING KI	2^nd Defendant (D2)
	TAM CHEUK HANG	3^rd Defendant (D3)

________________________

Before:

The Honourable Mr. Justice D. Yau

Dates of Hearing:	9 April 2024
Date of Ruling:	9 April 2024
Date of Reasons for Rulings:	6 December 2024

___________________________________

REASONS FOR RULINGS ON THE PROSECUTION'S
OUT OF TIME S.79I APPLICATION

___________________________________

2. A preliminary issue at trial was the prosecution’s out of time application for the evidence of PW21 Mr. Chua to be taken by live television link under s.79I of the Criminal Procedure Ordinance, Cap 221. PW21 was the witness who unlocked and extracted data from two iPhones that belonged to D1.

3. Under s.3(3) of the Live Television Link (Witness outside Hong Kong) Rules, Cap 221L, the s.79I application must be made within 42 days after the date on which the defendants were committed for trial under the Magistrates Ordinance, Cap 227. The present application was made some 2 years late.

4. The prosecution, therefore, also applied for an extension of time under s.8(1)(a) of Cap 221L for the s.79I application.

5. The two applications were opposed by all the defendants and were heard in open court on 9^th April 2024.

6. Having read the written submissions and heard the oral supplementary submissions, I ruled that the time extension be granted, and that PW21 to be permitted to give evidence by way of a live television link subject to the following conditions:

a) The prosecution to cover the reasonable expenses incurred by the defendants’ legal representatives to attend PW21’s testimony physically in Singapore, should the defendants consider this to be necessary.
b) The prosecution to ensure the propriety and fairness of the evidence taking process.

7. These are my reasons.

8. The background to the prosecution’s application are as set out in their written submissions:

“Procedural background
1. PW21 is a software engineer working at Cellebrite. Cellebrite is a wholly owned subsidiary of Cellebrite DI Ltd based in Singapore. It is the Asia-Pacific limb of Cellebrite DI Ltd. Cellebrite DI Ltd is Nasdaq listed company. Its business includes providing digital forensic and intelligence tools to law enforcement agencies or other private digital forensic examiners.
2. In and around October 2020, SFC noted from the public news and announcement that Cellebrite decided to stop selling its solutions and services to Hong Kong and China due to a regulatory change in the US, which restricts technology and other exports to Hong Kong and China.
3. In view of this, SFC sought PW21’s confirmation that he would come to Hong Kong to give evidence. In November 2020, PW21 confirmed that he had been approved by Cellebrite’s management to give evidence in Hong Kong.
4. In December 2021, SFC updated PW21 about the trial dates of these proceedings (these “Proceedings”) and sent him a copy of the witness summons. PW21, however, replied saying that he needed to check with management for approval.
5. On 20 June 2022, PW21 emailed SFC that he was informed by Cellebrite’s legal team not to act as a witness in Hong Kong as Cellebrite was unable to provide services and products to Hong Kong. PW21 also mentioned that Cellebrite’s legal team wished to obtain more information about these Proceedings and the evidence SFC wished to obtain from him.
6. Thereafter, in response to PW21’s request, SFC provided PW21 with the information sought by him.
7. In parallel, the DOJ began to liaise with the Singapore authorities to have PW21 give evidence remotely in Singapore. It was only until 4 January 2024 when DOJ received positive feedback from the Singapore authorities for rendering assistance in securing PW21’s testimony (see Letter from DOJ to Court dated 22 January 2024).
8. On 22 January 2024, the Prosecution applied under s 79I for PW21’s evidence to be heard by way of live television link.
9. On 5 February 2024, Ds filed their notices of opposition. The grounds of opposition can be summarised as follows:-
(1)  Delay in making the application (paragraph 1 of D1’s Notice of Opposition (“NoO”), paragraph 5 of D2’s NoO, paragraphs 1-2 of D3’s NoO).
(2)  Lack of particulars on television link arrangement (paragraphs 2-4 of D1’s NoO, paragraph 3 of D2’s NoO, paragraph 4 of D3’s NoO).
(3)  PW21’s evidence can be more conveniently given in Hong Kong (paragraph 4 of D2’s NoO).
(4)  Lack of basis to justify the departure from the starting point that witnesses should give evidence in court (paragraphs 1-2 to D2’s NoO, paragraph 3 of D3’s NoO).
(5)  It is not in the interest of justice (paragraph 5 of D1’s NoO, paragraph 5 of D3’s NoO).”

9. In gist, D1’s opposition to the applications is based on the lack of cogent reason why PW21 was not allowed to come to Hong Kong to give evidence; on the risk of PW21 being coerced into giving evidence or being coerced during his giving of evidence; and on the delay in the s.79I application.

10. The basis of D2’s opposition is “fourfold”. In gist, they say that the prosecution failed to give good reasons for the s.79I application; that the lack of particulars made it impracticable for the court to fairly and properly consider the application; that since the evidence can more conveniently be given in Hong Kong; and that it is not in the interests of justice to give the permission, the court would be mandated to refuse the s.79I application; and lastly that there is no acceptable explanation for the delay in making the application.

11. As for D3, they based their opposition on the ground that there was “gross and unexplained delay” in the application; that the prosecution had failed to provide any valid or cogent reason justifying the s.79I application; and that it is not in the interests of justice to grant the two applications.

CONSIDERATIONS

The extension of time application

12. S.9 of Cap 221L read as follows:

“Extension of time
(1)  The court may—
(a)  extend the period of 42 days specified in rule 3(2), (3), (4)  or (5)  on the application of a party to the proceedings, either before or after its expiry; or
(b)  extend the period of 14 days specified in rule 4 on the application of a party who is given a notice under rule 3(1), either before or after its expiry.
(2)  The application must—
(a)  be made in writing;
(b)  specify the grounds on which it is made;
(c)  in the case of an application under subrule (1)(b), be made within 28 days after the date on which the notice under rule 3(1)  is given; and
(d)  be given to—
(i)  the officer of the court; and
(ii)  all other parties to the proceedings.
(3)  The court may determine the application with or without a hearing.
(4)  If the court determines the application without a hearing, the officer of the court must notify all parties to the proceedings of the determination.
(5)  If the court decides to conduct a hearing in respect of the application, the officer of the court must notify all parties to the proceedings of the time and place of the hearing.
(6)  The hearing must be conducted in open court unless the court, where it considers it necessary in the interests of justice, orders that all or part of the hearing is to be conducted in camera.”

13. S.9 is silent as to how the court should exercise the discretion when considering whether to grant an extension of time.

14. Bearing in mind the specific circumstances of the present case, I find that the test as to how that discretion should be exercised is whether an extension of time would be prejudicial to the defendants’ right to a fair trial, and whether it would be in the interests of justice to grant or not grant the extension.

15. PW21 was a sales manager of the Singaporean company Cellebrite. Cellebrite has the proprietary technology to unlock a password locked iPhone. PW21 came to Hong Kong as a technician of Cellebrite and used the software and hardware of Cellebrite to unlock and conduct a full data extraction of D1’s two iPhones, and made copies onto external hard drives which were then immediately handed over to the SFC. PW21 was trained by Cellebrite to operate the tools to unlock the phones but has no expertise as to the coding of the software itself. He was not going to, and in fact did not, give evidence as an expert, but as a factual witness. PW21 did not examine the extracted data, nor did he take part in the analysis of the extracted data. His evidence would be straightforward.

16. The defendants had been aware of PW21’s evidence all along through his 2 witness statements. PW21 was not allowed by Cellebrite to come to Hong Kong to give evidence because Cellebrite had ceased to provide services to Hong Kong since October 2020. That was the only reason why he could not come to Hong Kong to give evidence in person.

17. I found that the reason behind the delay of the application exceptional. I also found that the circumstances surrounding the witness’ employer being unwilling to allow an employee to give evidence in Hong Kong exceptional, involving an element of international politics.

18. Given the simple nature and narrow scope of PW21’s evidence, I found that the extension of time would not in any way prevent the defendants from having a fair trial.

19. I also found that it would be in the interests of justice to grant the extension given the circumstances that led to the application being made out of time, that is to say, the initial position of PW21 being able to come to Hong Kong, which changed after Cellebrite had made a commercial decision to withdraw that permission. Given that PW21 was an employee of Cellebrite, his refusal to go against his employer’s will is reasonable.

THE S.79I APPLICATION

20. s.79I(2)(a) to (e) sets out 6 situations where the court shall not grant a s.79I application:

“79I(2)  The court shall not give permission under subsection (1)  if—
(a)  the person concerned is in Hong Kong;
(b)  the criminal proceedings concerned are specified proceedings;
(b)  the evidence can more conveniently be given in Hong Kong;
(c)  a live television link is not available and cannot reasonably be made available;
(d)  measures to ensure that the person will be giving evidence without coercion cannot reasonably be taken; or
(e)  it is not in the interests of justice to do so”

21. Applying the section I made the following findings.

22. PW21 is not, and will not be in Hong Kong for reason referred to above.

23. The present proceedings are not specified proceedings.

24. Based on the affirmation of Ms. Ma, PW21 is not going to be able to come to Hong Kong because of the position his employer had taken. It is not a case of PW21 not willing to come, but him being unable to come. As such, it is not the case that his evidence can “more conveniently be given in Hong Kong”. Cellebrite believed that to allow PW21 to give evidence in Hong Kong may jeopardize their company’s operation given the stance the US government has been taking in relation to trade concerning China and hence Hong Kong. This is a fair and reasonable stance to take given the position of the US government in relation to trade issues concerning China. It is not unreasonable for Cellebrite to worry about the company’s survival should they allow PW21 to come to Hong Kong to give evidence physically. It is also not unreasonable for Cellebrite to believe that giving evidence by way of a TV link while still in Singapore and not China would not be as harmful to the company. It is reasonable for PW21 to so perceive his employer’s stance, and for him to obey their order of not coming physically to Hong Kong to give evidence. Therefore, the evidence cannot be more conveniently be given in Hong Kong.

25. Singapore and Hong Kong are both technologically advanced. The prosecution has demonstrated that a live television link will be available should their application be granted. There had been numerous such taking of evidence before and there will be no problem establishing a proper live television link.

26. Singapore is a country with a well-established judicial system. They had confirmed their assistance in the taking of evidence via a television link, including arranging for the presence of an officer of the Singapore Police Force at the video link venue. The prosecution has further agreed to cover the reasonable expenses incurred by the defendants’ legal representatives so that they can be in the same room with PW21 when he gives evidence, to ensure PW21 will be giving evidence without coercion.

27. As referred to above, the nature of PW21’s evidence is straightforward. The witness had nothing to do with the extracted data. He was merely a technician who operated the tools belonging to his employer. Even if somehow the software was rigged in such a way as to generate completely wrong data, he would not be in a position to know. He is not going to be asked to examine or analyze the extracted data when he gives evidence.

28. I found that it would not be against the interests of justice to permit him to give evidence via a live television link.

29. In fact, given the circumstances of the case, I would go so far as to find, and I did find, that it would be in the interests of justice to permit him to do so.

CONCLUSION

30. That being the case, I granted the prosecution’s applications.

	(Douglas Yau)
	Judge of the Court of First Instance of the High Court

Mr. Derek Chan SC and Mr. Peter Chiu, Counsel on fiat, for the Prosecution/ HKSAR

Mr. Marco Li, Mr. Melvin Ho and Ms. Rachel Ronald instructed by Messrs. Littlewoods, for the 1^st Defendant

Mr. Tony Ko, Ms. Dorothy Cheung, instructed by Messrs. T H Chan & Co, for the 2^nd Defendant

Mr. Bernard Mak and Ms. Candice Lau, instructed by Messrs. Michael Li & Co, for the 3^rd Defendant

HKSAR v. SIT YI KI AND OTHERS

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