Man who operated Alipay top-up service gets Hong Kong money laundering conviction quashed
High Court rules surcharges did not constitute a remittance service, siding with appellant’s claim that he was just helping clients make purchases on Taobao
A man who took Hong Kong dollars from clients and helped them top up their online payment service accounts, in RMB with a surcharge, had his conviction quashed on Tuesday.
The man – whose name transliterated as Yip Wai-cheong, according to a High Court judgement – had earlier been convicted of operating a money service without a license.
Prosecutors argued that what he did on Alipay, a third-party online payment platform, virtually equaled a “money remittance service”. Yip was previously fined HK$5,000 for breaching the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance.
READ MORE: China’s crackdown on underground banks uncovers illegal money transfers of more than US$125bn
But the Court of First Instance, where he lodged the appeal against his conviction, on Tuesday ruled that the man took the money simply to assist his clients in making purchases in online e-commerce platform Taobao.
“The nature of his business is therefore not in remittance service and hence he was not operating a money service,” Deputy High Court Judge Poon Siu-tung wrote.
Taobao and Alipay are owned by Jack Ma, chairman and founder of Alibaba Group, who bought all media assets of the SCMP Group, including the South China Morning Post, for HK$2.06 billion last year.
Yip stood trial earlier at Kwun Tong Court, which heard that Yip’s clients would deposit money into his Hong Kong bank account. He would charge a surcharge of 0.2 per cent for each transaction.