Hong Kong police officer and wife jailed for conning friends and neighbours out of HK$15 million in luxury goods scam
Pair sentenced to more than eight years after using ill-gotten gains to fund extravagant lifestyle while running up debts of HK$1.8 million
A Hong Kong police officer and his wife were jailed for a total of more than eight years on Thursday after running a Ponzi scheme that saw her steal HK$15 million (US$1.9 million) from friends and neighbours.
The pair, who ran up debts of HK$1.8 million living an “extravagant lifestyle”, conned the parents and teachers at their daughter’s school into investing in a bogus scheme to trade luxury goods such as iPhones, iPads and Rolex watches.
At the District Court on Thursday, the woman, Chu Hoi-yan, 38, was jailed for six years and three months after being found guilty on May 5 of 14 charges ranging from fraud to money laundering.
Her husband, Kevin Auyeung Hak-man, 41, a 22-year police veteran, was jailed for two years on two counts of money laundering.
A third defendant, Lee Yuk-fung, 46, who helped Chu in the scheme, was jailed for three years and nine months after being found guilty of one count of money laundering, and one count of conspiring to launder money.
The scam centred on Chu, who told her victims that she could stock up cheaply on luxury goods, and resell for a profit, the court heard earlier.
But Deputy Judge Amy Chan Wai-mun said instead of making real investments between 2011 and 2013, Chu used the money her most recent victims had given her to repay the earlier ones, to keep the scam rolling.
The husband and wife duo lived an extravagant lifestyle, with Chu hoarding more than 20 Chanel and two Hermes handbags. The family travelled to Japan 14 times between 2010 and 2013, despite their bank debts amounting to HK$1.8 million.
“The purpose of [Chu] stealing the money had nothing to do with any [financial] emergency at all, but because her extravagant lifestyle caused her books to be in the red,” the judge said.
“The court shows no sympathy.”
The court heard at the time of the offence, Chu’s daughter was a kindergarten pupil. The mother would approach parents she met there, as well as her daughter’s teachers, to ask them if they would like to take part in her profitable scheme.
In some instances, she persuaded her victims to buy Rolex watches at a relatively normal price, which she would subsequently ask Lee to pawn – something she did 173 times.
Some of the money generated would be given back to the victims to make them feel the scheme was working, despite them making no profit.
What the victims did not know was that Chu was pocketing most of the money, which she continued to do until she was no longer able to repay them.
“[Chu] tried to win the trust of the investors, offering them profits at the outset, in order to lower their guard for making further investments, until they end up suffering losses,” the judge said.
The case was serious in that it involved many victims and an enormous amount of money, Chan added.
Auyeung allowed his two bank accounts to be used to launder Chu’s illegal funds, the court found.
The judge refused to accept Auyeung’s suggestion that he committed the offence because he trusted his wife. She said his long service in the police force would have made him more aware of what constituted criminal acts than “an innocuous housewife”.