No Result
View All Result
SUBSCRIBE | NO FEES, NO PAYWALLS
MANAGE MY SUBSCRIPTION
NEWSLETTER
Corporate Compliance Insights
  • Home
  • About
    • About CCI
    • CCI Magazine
    • Writing for CCI
    • Career Connection
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Library
    • Download Whitepapers & Reports
    • Download eBooks
    • New: Living Your Best Compliance Life by Mary Shirley
    • New: Ethics and Compliance for Humans by Adam Balfour
    • 2021: Raise Your Game, Not Your Voice by Lentini-Walker & Tschida
    • CCI Press & Compliance Bookshelf
  • Podcasts
    • Great Women in Compliance
    • Unless: The Podcast (Hemma Lomax)
  • Research
  • Webinars
  • Events
  • Subscribe
Jump to a Section
  • At the Office
    • Ethics
    • HR Compliance
    • Leadership & Career
    • Well-Being at Work
  • Compliance & Risk
    • Compliance
    • FCPA
    • Fraud
    • Risk
  • Finserv & Audit
    • Financial Services
    • Internal Audit
  • Governance
    • ESG
    • Getting Governance Right
  • Infosec
    • Cybersecurity
    • Data Privacy
  • Opinion
    • Adam Balfour
    • Jim DeLoach
    • Mary Shirley
    • Yan Tougas
No Result
View All Result
Corporate Compliance Insights
Home Compliance

“Thought Crimes” and “Favorable Dispositions”

by Wendy Wysong
August 26, 2016
in Compliance
There’s a new AML ruling in Hong Kong

with contributing authors Richard Sharpe, William Wong and Nick Turner

Hong Kong’s Court of Final Appeal (CFA) has reaffirmed that a person can be sent to jail for handling money that they had reasonable grounds to believe derived from a crime, whether it did or not. If a defendant thinks he’s laundering criminal proceeds, Hong Kong thinks he’s guilty, with no need to prove an underlying offense.

The former Birmingham City Football Club chairman Carson Yeung was appealing his 2014 conviction on five counts of laundering HKD721 million (USD9.3 million) through five different Hong Kong bank accounts. He was sentenced to six years in jail.

The day after the ruling in Yeung’s case, the CFA gave leave to appeal to the former chief secretary of Hong Kong, Rafael Hui, and the former chairman of Hong Kong property developer Sun Hung Kai Properties, Thomas Kwok, against their 2014 convictions for misconduct in public office. At issue is whether it was enough to prove that the public officer was “favorably disposed” toward Kwok as a result of receiving millions of dollars from him, when no quid pro quo could be established. Are “positive thoughts” a sufficient benefit to be deterred by the threat of criminal conviction?

While the two rulings seem to be contradictory – the first in upholding a “thought crime” and the second in reconsidering one – the CFA’s doublethink (holding two seemingly contradictory ideas simultaneously) may be the inevitable result of trying to ease the burden of proving complex crimes. In other words, don’t even think about committing a crime in Hong Kong.

Where’s the Crime?

The judgment in Yeung was criticized for justifying the concept of “thought crime” when Hong Kong’s CFA reaffirmed that, on a charge of dealing with proceeds of crime, prosecutors only have to prove the defendant had reasonable grounds for believing the property is the proceeds of crime. Section 25(1) of the Organised and Serious Crimes Ordinance (OSCO) says that “a person commits an offence, if, knowing or having reasonable grounds to believe that any property in whole or in part directly or indirectly represents any person’s proceeds of an indictable offence, he deals with that property.”

In Yeung’s case, the prosecution did not attempt to identify the offenses from which the money was derived. Instead, its case was that Yeung must have had reasonable grounds to believe that the money was the proceeds of crime.

Yeung gave evidence that the money in the accounts in his name had come from legitimate sources, including his casino winnings and share trading. The trial judge, however, pointed out that Yeung had used his father’s name to open the accounts he had used to conceal the source of the funds.

Thought Crime?

Yeung argued that accepting the prosecution case meant a defendant could be convicted for a “thought crime.” The CFA rejected this defense, observing that if a defendant does not know, but has reasonable grounds to believe that funds are tainted, the defendant can claim immunity by disclosing his suspicion to an authorized officer with legal powers to investigate the source of the funds. Critics point out, however, that the test in Hong Kong means that a person has to prove himself innocent rather than have others proving him guilty, effectively turning the law on its head.  One commentator went so far as to call it a “sad day for justice in Hong Kong.”

“Sweetener” Enough?

The day after the Yeung ruling, the CFA granted leave to appeal to former chief secretary Hui and former Sun Hung Kai chairman Kwok their 2014 convictions for misconduct in public office. The Court granted the appeal to determine whether it is sufficient for the prosecution to prove a public officer is “favorably disposed” to another person, without having to point to any specific criminal act. At issue is the so-called “sweetener” doctrine, which says it is not necessary for prosecutors to prove a specific quid pro quo to establish misconduct in public office offenses.

Prosecutors had successfully argued at trial that Hui had received USD8.5 million from Kwok to help ensure that the government maintained a “favorable disposition” toward the property group. As with Yeung, the ruling as it stands means no underlying crime needs to be proved. The hearing will take place in May 2017.

A Helping Hand for Prosecutors

Taken together, these two decisions show the continuing trend in Hong Kong to lessen the burden on prosecutors in cases involving financial crimes such as money laundering and bribery. In some ways, the decisions assist prosecutors arguing complex patterns of transactions or conduct yet who find proving crimes, in the words used in Yeung,  “complex and cumbersome.” The fight against corruption continues apace in Hong Kong, despite the unanswered questions left behind.


Previous Post

A Return to Common Sense

Next Post

How the OCR’s New Guidance Rule Re-Examines Ransomware

Wendy Wysong

Wendy Wysong

Wendy L. Wysong is a partner at Steptoe & Johnson. She served previously as a litigation partner with Clifford Chance, offering clients advice and representation on compliance and enforcement under the Foreign Corrupt Practices Act, the Arms Export Control Act, International Traffic in Arms Regulations, Export Administration Regulations, and OFAC Economic Sanctions. She was appointed by the State Department as the ITAR Special Compliance Official for Xe Services (formerly Blackwater) in 2010. Wendy combines her experience as a former federal prosecutor with the United States Attorney for the District of Columbia for 16 years with her regulatory background as the former Deputy Assistant Secretary for Export Enforcement at the Bureau of Industry and Security, U.S. Department of Commerce. She managed its enforcement program and was involved in the development and implementation of foreign policy through export controls across the administration, including the Departments of Justice, State, Treasury and Homeland Security, as well as the intelligence community. Wendy received her law degree in 1984 from the University of Virginia School of Law, where she was a member of the University of Virginia Law Review.

Related Posts

news roundup data grungy

DEI, Immigration Regulations Lead List of Employers’ Concerns

by Staff and Wire Reports
May 9, 2025

Half of fraud driven by AI; finserv firms cite tech risks in ’25

GFT Canada Update

GFT Expands AI Compliance Suite for Canadian Credit Unions

by Corporate Compliance Insights
May 8, 2025

Digital transformation company GFT has expanded its compliance suite to help Canadian credit unions combat payment scams and identity theft...

AxiomGRC Launch

Business Resilience Platform Axiom GRC Enters Global Market

by Corporate Compliance Insights
May 8, 2025

A business resilience platform called Axiom GRC has launched in the UK, backed by £500 million private equity investment from...

MyCOI Launch

myCOI Launches AI-Powered Insurance Compliance Platform

by Corporate Compliance Insights
May 8, 2025

Insuretech provider myCOI has launched illumend, an AI-powered platform designed to manage third-party insurance compliance and certificate of insurance processing....

Next Post
Increased risk of ransomware attacks coupled with confusing guidance from regulators

How the OCR’s New Guidance Rule Re-Examines Ransomware

No Result
View All Result

Privacy Policy | AI Policy

Founded in 2010, CCI is the web’s premier global independent news source for compliance, ethics, risk and information security. 

Got a news tip? Get in touch. Want a weekly round-up in your inbox? Sign up for free. No subscription fees, no paywalls. 

Follow Us

Browse Topics:

  • CCI Press
  • Compliance
  • Compliance Podcasts
  • Cybersecurity
  • Data Privacy
  • eBooks Published by CCI
  • Ethics
  • FCPA
  • Featured
  • Financial Services
  • Fraud
  • Governance
  • GRC Vendor News
  • HR Compliance
  • Internal Audit
  • Leadership and Career
  • On Demand Webinars
  • Opinion
  • Research
  • Resource Library
  • Risk
  • Uncategorized
  • Videos
  • Webinars
  • Well-Being
  • Whitepapers

© 2025 Corporate Compliance Insights

Welcome to CCI. This site uses cookies. Please click OK to accept. Privacy Policy
Cookie settingsACCEPT
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT
No Result
View All Result
  • Home
  • About
    • About CCI
    • CCI Magazine
    • Writing for CCI
    • Career Connection
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Library
    • Download Whitepapers & Reports
    • Download eBooks
    • New: Living Your Best Compliance Life by Mary Shirley
    • New: Ethics and Compliance for Humans by Adam Balfour
    • 2021: Raise Your Game, Not Your Voice by Lentini-Walker & Tschida
    • CCI Press & Compliance Bookshelf
  • Podcasts
    • Great Women in Compliance
    • Unless: The Podcast (Hemma Lomax)
  • Research
  • Webinars
  • Events
  • Subscribe

© 2025 Corporate Compliance Insights