(The key events and background of this case are set out below. Unless otherwise specified, all sums are quoted in Hong Kong dollars.)
The principal figure in this case, a police detective sergeant, joined the force as a messenger and became a constable the following year.
He left the force and started running businesses on the Mainland. In 1945, after the war was over, he rejoined the force.
He was promoted to sergeant, and became station sergeant of Yau Ma Tei Police Station, a post he held until his early retirement.
The Anti-Corruption Branch – then an arm of the police force – began to investigate his very extensive assets. He was twice interviewed and asked to account for his wealth. He claimed that it derived mainly from his wartime business activities. Once all possible avenues under the law as it then stood had been explored, the investigation necessarily ground to a halt. The most that could be done was to order him to take early retirement. This he did on 13 August 1969.
The Government replaced the existing Prevention of Corruption Ordinance with the Prevention of Bribery Ordinance (PBO). Section 10 of the PBO made any person who was or had been a Government employee, and failed to give a reasonable explanation to the court of property or pecuniary resources disproportionate to his or her official emoluments, guilty of an offence.
The Government set up a new agency independent of the police – the Independent Commission Against Corruption (ICAC) – to fight corruption. Many of the ICAC’s earliest corruption investigations involved public officials. In 1975 alone, cases implicating police officers accounted for 42 percent of all ICAC cases.
The ICAC took over the detective sergeant’s file and resumed investigations. By now, seven years had elapsed since his retirement.
The ICAC arrested him in accordance with Section 10 of PBO. He was requested to offer a justification for his assets, which were well in excess of his income from employment with the police, and he was ordered to surrender his travel documents and make no changes to his assets.
He applied for the injunctions against him to be lifted. He contended that he had already retired before Section 10 of PBO took effect in 1971 and that therefore he could not be bound by that ordinance. This application was rejected by the High Court two months later.
The detective sergeant had offered no account whatever of his assets. The ICAC thus decided to furnish him with a list of such assets, the origins of which he now needed by law to explain.
The ICAC received Part I of his explanation of how he had amassed his wealth.
He lodged an appeal with the Court of Appeal, reiterating that he could not be bound by the PBO. The Court of Appeal rejected this appeal on 23 November.
The detective sergeant then gave the ICAC Parts II and III of his explanation regarding the sources of his wealth. These turned out to differ little from the account he had given to the Anti-Corruption Branch ten years earlier.
He finally took his appeal against being bound by the PBO to the Privy Council, which was then Hong Kong’s highest appeal body. Once again, his appeal was rejected.
Based on the evidence provided by the ICAC, the Department of Justice agreed to institute a prosecution against the detective sergeant. He was arrested by the ICAC and appeared before a magistrate on the same day.
The charge, which he denied, stated that between 1951 and 15 May 1971 (the latter being the date when the PBO came into effect), he possessed assets worth about $5.3 million and that this was disproportionate to the approximately $220,000 emoluments he had earned as a police officer. (The assets involved would have been worth over $9 million in 1978 money.)
He was allowed bail in the huge sum of $15.95 million – $1 million in cash, plus a surety of $2 million and a guarantee made up of real estate, valued at $12.95 million, which was in his wife’s name.
The detective sergeant was tried in the District Court where he denied the charges. Through his defence lawyer, he twice proposed to the court that he surrendered $16 million in exchange for a suspended sentence. The judge opined that as a matter of social justice he would be committed to jail if convicted. His defence lawyer then withdrew the surrender offer.
Pending further trial, the detective sergeant was again allowed out on bail. This time it amounted to $1 million in cash, a surety of $2 million, and a guarantee of $13 million provided by his wife. ($12 million of which had to be placed in a bank custody with changes allowable only with the court’s consent.)
The prosecution calculated that the value of the liquid assets he owned had risen to approximately $21.5 million by the time judgement was handed down. He was convicted and sentenced to two years’ imprisonment and a fine of $16 million. Of this, $12 million had to be paid immediately, with the balance to be settled within nine months of sentencing.
He lodged an appeal against the sentence, but this was turned down on 13 December.