Case Digest: What Do Hong Kong Courts Do to Mule-Account Holders? Five Real Judgments

About these case summaries: the summaries below were prepared by this site based on our own reading and understanding of the judgments. They are not legal advice, have no legal effect, and must not be cited as authority. Cases are identified by neutral citation only, and parties are referred to by role — no names are reproduced. Read the originals via the HKLII links. Sentences depend on the specific facts of each case; past decisions do not indicate the outcome of any other case. Our full verification process for case content — full-text reading of every judgment, corrigendum checks and independent human review — is set out in our methodology .

A hypothetical scenario

Example (hypothetical): an online contact tells you, "lend me an account to receive a few payments — $2,600 a month, you don't have to do anything." You think: the account is mine, the money wasn't stolen by me — at most I'm just "lending" it. This article predicts nothing about anyone's case. It only walks through what Hong Kong courts actually did, in cases they have already decided.

The framework the courts apply

The usual charge is "dealing with property known or reasonably believed to represent proceeds of an indictable offence" — colloquially "money laundering" — under s.25 of the Organized and Serious Crimes Ordinance (Cap. 455). In the fourth case below, counsel for the Department of Justice stated to the court that the maximum penalty is a $5,000,000 fine and 14 years' imprisonment ([2026] HKCFI 217 ¶24).

The appellate framework, as quoted verbatim inside the judgments cited here:

• The District Court in [2025] HKDC 632 (¶59) recited the Court of Appeal's reference bands from the Hsu Yu Yi case ([2010] 5 HKLRD 536): where the laundered sum is $1–2 million the starting point is about 3 years; $3–6 million about 4 years; above $10 million it can exceed 5 years. The same authority states that "the amount involved is the important consideration, not the benefit the defendant obtained from the transaction."
• The same judgment (¶61) recited Boma Amaso [2012] 2 HKLRD 33: money laundering is a serious offence and "deterrence is the most important sentencing principle."
• In [2026] HKCFI 217 (¶46), the Court of First Instance quoted the Court of Appeal's settled position that offences of this nature "attract immediate custodial sentences even for a first offender."

Pattern 1: selling an account for a few thousand dollars — sentences measured in months

[2025] HKDC 632 (District Court, reasons for sentence) dealt with an illegal bookmaking syndicate controlling 122 mule accounts which took about $68.1 million in net deposits over half a year (¶10). The four account-holders sentenced in that judgment (all pleaded guilty):

• A shop salesman at the time, later a site electrician (39 at sentence, 34 at the time) took $3,000 to open two virtual-bank accounts for others; the accounts processed $193,992 and $79,848. Combined starting point 13.5 months; after the guilty-plea discount and factors including being his elderly mother's principal carer: 5 months (¶65–66; background at ¶32).
• A former construction worker and security guard, unemployed at the time after losing work in the pandemic (29 at sentence, 25 at the time), lent his bank card for $1,000; the account involved $239,590 in criminal proceeds. Starting point 15 months; 11 months (¶67; background at ¶35–36).
• A former renovation worker (39 at sentence, 34 at the time) sold two accounts for $4,000; together they processed about $2.86 million. Combined starting point 33 months; 22 months after plea (¶68–69; background at ¶38).
• A former restaurant cleaner (45 at sentence, 40 at the time) sold two accounts for $2,000; about $1.91 million. Combined starting point 30 months; 16 months, allowing for his recovery from an amputation (¶70–71; background at ¶40).

Note the contrast: rewards of one to four thousand dollars; sentences of 5 to 22 months — exactly Hsu Yu Yi's point that the amount through the account matters, not what you were paid.

Their backgrounds are worth noting too. The occupations recorded in the judgment are shop salesman, construction worker and security guard, renovation worker and restaurant cleaner; the ages run from mid-twenties to mid-forties. These were not finance or legal professionals — they were ordinary working people.

Pattern 2: never paid a cent — convicted anyway

[2025] HKDC 648 (District Court, reasons for verdict) concerned another account-holder in the same syndicate, who contested trial. The court's findings: a middleman promised him $500 if an account was opened successfully; he handed over his ID card and posed for the verification photos; the virtual-bank account then received 162 deposits totalling $424,572, all withdrawn (¶4, ¶45–47).

The critical point: the middleman later told him the account "failed to open", and he was never paid anything. The court held this made no difference — conspiracy is complete the moment the agreement is made; whether the reward was honoured, or he was himself cheated, changes nothing (¶62–65, ¶83). The court applied the Court of Final Appeal's objective test: not whether the defendant subjectively believed the money was clean, but whether any reasonable person, knowing the facts the defendant knew, would necessarily have believed it was dirty (¶77–78).

Pattern 3: not knowing what the upstream crime was — the full amount still counts

[2024] HKDC 2003 (District Court, reasons for sentence) arose from a debt-restructuring scam run through fake law firms and fake mortgage centres. Three mule-account defendants (all convicted after trial):

• A defendant who was a chef earning $18,000 a month at the time of sentence (29 at sentence, 24 at the offence; the judgment does not record what he did then) took a reward to set up a business registration, office tenancy and corporate bank account in his own name for others' use; the account processed $3,822,000 in about two and a half months. Starting point 3 years 6 months; 3 years 5 months (¶41–43; background at ¶20).
• A self-employed lorry driver (40 at sentence, in transport work since 2008) lent two personal accounts which handled about $3.6 million in large cheques, each withdrawn in cash the next day. Overall starting point 3 years 6 months; 3 years 5 months (¶38–40; background at ¶23–24).
• One defendant, aged just 22 at the time, lent an account for a single $1.2 million cheque. The court said expressly that "the $1.2 million involved is the important consideration, not the benefit the defendant obtained", but reflecting the single cheque, short duration and a difficult personal background, took 17–18 months as the starting point: 15 months (¶50).

The judgment states there was no evidence any of the three knew the money came from fraud. Knowing the deposits were "proceeds of crime" was enough (¶37, ¶41, ¶50).

Pattern 4: not lending an account but collecting them — a graver role, said the court

[2026] HKCFI 217 (Court of First Instance, magistracy appeal) is among the first of these judgments in 2026. An appellant who was 26 at the time of the offence (27 at sentence), with a clear record and working in early-childhood education since 2023, acted as the "runner" for a syndicate recruiting accounts through a Facebook "easy money" page — meeting the seller, checking the account, relaying the price ($2,600 per account per month; background at ¶7). The "seller" was an undercover police officer, so no money was ever laundered at all (¶4–5).

The magistrate imposed 12 months, saying the defendant "played the foot-soldier role in the money-laundering hierarchy… his culpability is heavier than an ordinary mule-account holder's", and that money laundering "grows ever more rampant and serious — its blow to society is like that of drugs; the court will not relax" (quoted at ¶12).

On appeal, counsel pressed for a community service order or suspended sentence: first offender, depression, a psychologist's report describing suggestibility, a former employer willing to re-hire. The court considered and rejected each, quoting the Court of Appeal: such offences "attract immediate custodial sentences even for a first offender" (¶46). The 12 months stood (¶51).

Pattern 5: how the Court of Appeal does the arithmetic — "left hand to right hand" transfers

[2024] HKCA 1062 (Court of Appeal) is a textbook sentencing appeal. The appellant was 65 at sentence and had worked as a driver throughout, and had also run three mainland businesses since the 1990s (¶10). His three accounts processed $12.59 million gross between 2007 and 2010, but about $4.6 million of that was transfers between his own three accounts — the prosecution's expert accepted only about $8 million was unexplained. The Court of Appeal proceeded on about $7.7 million — that $8 million less the appellant's own $245,435 and $95,749 of private lending (¶3, ¶14, ¶16, ¶26).

The Court of Appeal set out a method (¶24):

• first deduct the cross-deposits (transfers among the defendant's own accounts);
• fix the starting point on the actual amount of dirty money;
• then uplift for the seriousness of the "layering" — because shuffling money between accounts is precisely how origins are concealed, and such operations "increase culpability… the more numerous and complex, the greater the culpability" (¶22).

Result: starting point reduced from 4 years 3 months to 3 years 9 months; 3 years 3 months after discount; and given 23 months already served and his health, the court exercised discretion to allow immediate release (¶26–28). The case is not "a light sentence" — it is the Court of Appeal showing how the sum should be done.

Quick reference table (swipe for full table)

It wasn't your account to lend: when someone transfers money to you "by mistake" and asks for it back

The judgments above concern accounts that were handed over, bought and sold, or used to move

money — mode 4 is a runner collecting accounts, and mode 5 is transfers between the appellant's

own three accounts. A different scenario has also been reported, in which the account holder never

lent anything to anyone: money simply arrives, and the sender then asks for it back.

Mis-transfers are addressed officially: in 2019 the HKMA

issued a circular on handling procedures for following up mis-transfers of funds, requiring banks

and stored-value facility licensees to confirm the transfer, obtain authorization, and return the

funds through the recipient's institution to the sender's institution and then to the sender; the

HKMA's consumer FAQ likewise tells a recipient to notify the bank or stored-value facility

provider promptly. **That mechanism is precisely "return it through the institutions, do not

transfer it yourself." The

statutory offence does not require an earlier agreement to lend the account — so "I never lent my

account to anyone" is not by itself a defence gate. But whether the account was deliberately handed

over, or the credit was wholly unsolicited, remains evidentially important to what the holder knew

or had grounds to believe.**

1 · How it works

Money you do not recognise arrives in your account. Someone then contacts you, says it was sent

in error, and asks you to "return" it by FPS or PayMe — usually to a different account from the

one it came from, and usually in a hurry.

The moment you send it back, you have personally made an outward transfer. If the money was

criminal proceeds, you have become a link in the chain — and unlike the people behind it, you are

a link with a name, an account number and a timestamp.

2 · Why "returning" it is dealing under Cap. 455 s.25

Section 25(1) of the Organized and Serious Crimes Ordinance (Cap. 455) — **consolidated

19 September 2025** — provides:

"Dealing" is not used loosely; it is defined in section 2, and the definition expressly includes:

**The s.2 definition covers both sides on its face: the money arriving falls within

(a) receiving or acquiring, and sending it on is (c) disposing of or converting.** To put it

precisely, though: **whether a wholly unsolicited and unnoticed incoming credit is itself the

holder's dealing at that moment is fact-sensitive, and it was not decided by the account-lending

cases discussed below. The later, deliberate outward transfer is the distinct and clear act of

dealing.** So "I only passed it along, I kept nothing" is not an answer to the section. The section

does not ask whether you profited. It asks whether you dealt.

Section 25(3) sets the penalty: **on conviction upon indictment, a fine of $5,000,000 and

imprisonment for 14 years.* The HKMA's Don't lend or sell your account* page states the same

exposure.

3 · So is any incoming money a trap? No. The line is the state of mind

Handing over an account can itself constitute dealing. In CACC 111/2008 (Court of Appeal,

21 October 2008 — a case decided before neutral citations, so identified by its action number),

the trial judge held that lending a bank account for deposits and withdrawals was an essential

part of money laundering and amounted to dealing with property. The Court of Appeal dismissed the

applications for leave to appeal against conviction and adopted the approach in CACC 314/2006: where a person allows

another to use his bank accounts to deposit and withdraw funds, in the absence of evidence to the

contrary the inevitable inference is that the holder had reasonable grounds to believe the funds

represented the proceeds of an indictable offence.

**But the section contains a gate the prosecution must pass through: s.25(1) requires knowledge

or reasonable grounds to believe.**

That phrase cannot be shortened to "you are guilty even if you didn't know", because it sets out

two alternative routes:

Route one: the prosecution proves that you knew. Actual knowledge is itself sufficient — so

what you subjectively knew is not irrelevant; it is one of the two ways the element is made out.

**Route two: if actual knowledge cannot be proved, the prosecution may instead prove that you had

reasonable grounds to believe. On that route the court looks at the grounds you actually held

at the time and whether those grounds were reasonable**, assessed on the facts and circumstances

you actually knew — which is what the Court of Final Appeal test cited under 模式二 above asks, by

reference to a person knowing the same facts you knew.

One thing must be stated clearly: your own explanation is not excluded. How you understood

the situation, what you made of the person contacting you, and why you acted as you did are all

evidence the court hears and weighs — but those grounds are themselves tested for reasonableness,

and the court may find them unconvincing or give them little weight. **Throughout, the burden is

on the prosecution** to prove beyond reasonable doubt that you personally had the knowledge or

reasonable grounds to believe that the section requires. So:

• Money arriving unexpectedly, origin unknown to you, is not in itself an offence.
• But once a stranger asks you to move money you do not recognise, urgently, to an unrelated

account, you hold a new set of facts — and "reasonable grounds to believe" is judged against

the facts you hold.

**The two Court of Appeal decisions above establish the opposite proposition: handing an account

over for deposits and withdrawals can amount to dealing, and in the absence of evidence to the

contrary the court may draw the inference that the holder had reasonable grounds to believe.** So

"lending an account is always innocent" does not hold; and "you are guilty even if you didn't

know" is equally wrong. The line is those six words in s.25(1), not whether you were paid.

4 · E-wallets count — the section says property, not bank account

Section 25 never uses the words "bank account". It says "property". Returning money through FPS,

PayMe or a stored-value facility is no different from doing it through a bank. The Police's own

page defines the practice in exactly those terms, naming **bank accounts, electronic payment

accounts and stored-value facility accounts** together.

5 · One real judgment: no personal benefit, four and a half years

If you think "I never made a cent" settles it, [2026] HKCFI 3496 (Court of First Instance,

reasons for sentence, 24 June 2026) is worth following step by step. The defendant pleaded guilty

to two counts of dealing with property known or believed to represent proceeds of an indictable

offence. The court found that she had been persuaded by her cousin-in-law to come to Hong Kong to

set up a company and open accounts, handed over control of the online banking once they were open,

personally conducted none of the transfers. At ¶31 the court recorded that **there is no evidence

that she received any personal benefit**. ("Received no personal benefit whatsoever" is counsel's

phrase at ¶15, not a finding in the court's own words.)

**And the court said, in terms, that she "plainly knew or had reasonable grounds to believe that

the funds were proceeds of crime – otherwise she would not have admitted the charges."** What she

did not know was the predicate offence — the prosecution never identified which crime produced

the money. **This is not a case about being punished while innocent of knowledge. It is an illustration of

sentencing where the accused admitted the offence, including its mental element** — and it settles

no contested point of law, because nothing about the mental element was in dispute.

The sentence was built openly, and it reads as arithmetic:

The court also recorded the prevalence evidence supporting the s.27 enhancement: 2,757 people were

arrested for money laundering between January and April 2026, of whom 72.58% were stooges; in 2024

there were 10,496 arrests, 75.10% stooges. The judge accepted the enhancement but held the

defendant to be a low-level participant, and applied 15% rather than more.

**This was a sentencing decision on a guilty plea. It settles no contested point of law, and the

sentence reflects the facts of that case only.**

6 · Section 25A: a statutory duty to disclose on knowledge or suspicion — and the protection it carries

Section 25(1), quoted above, opens with the words "Subject to section 25A". Section 25A is a

separate duty that most people have never heard of:

Contravening that subsection is itself an offence:

(*The section states a level, not a fixed sum.* The amount for each level is set by

section 113B and Schedule 8 to the Criminal Procedure Ordinance (Cap. 221), and s.113B(3)

provides that **"The Chief Executive in Council may by regulation amend the amounts set out in

Schedule 8"** to reflect inflation.)

But s.25A is not only a duty — it is a protection written into the statute. Section 25A(2)

provides that a person who has made a disclosure does not commit the s.25(1) offence in

respect of a related act if:

**Note that route (a) requires TWO things, not one: disclosure before the act, AND the consent of

an authorized officer to that act. Having filed a report does not by itself entitle you to make

the transfer.** Route (b) is the after-the-event route: the disclosure must be on your own

initiative and as soon as it is reasonable.

Section 25(2) provides a further defence, but it too has two conditions and is not generated

merely by disclosing. The accused must prove **(i) that he intended to disclose the knowledge,

suspicion or matter referred to in s.25A(1), and (ii) that he had reasonable excuse for failing to

disclose in accordance with s.25A(2).**

**In other words: the statute does not ask you to guess correctly — it asks you to speak. But

speaking is not the same as being cleared to act.**

What this means in practice:

• There is an established institutional route for returning a mis-transfer. The HKMA's 2019

circular requires banks and stored-value facility licensees to confirm the transfer, obtain

authorization, and return the funds through the recipient's institution to the sender's

institution and then to the sender; its consumer FAQ tells a recipient to notify the bank or

operator. That route runs between institutions, not through the recipient.

• **An outward transfer made by the account holder is, on the words of s.2, limb (c) — disposing

of or converting.** So is a transfer to a third-party account the other side nominates. That is

a question of definition, not of good or bad practice.

• s.25A(1) states a legal duty, not an option. Where a person knows or suspects that property

represents the proceeds of an indictable offence, the section provides that he *shall as soon as

it is reasonable for him to do so* disclose to an authorized officer. The Joint Financial

Intelligence Unit accepts suspicious transaction reports from persons who are not regulated

entities, by email.

• Records matter because the section turns on evidence. What the section asks is what the

person actually knew at the time; messages, calls, the credit itself and the time a bank was

notified are the material that reflects that moment.

• Notifying a bank and making a s.25A disclosure are different things. Telling an institution

is not by itself a statutory disclosure to an authorized officer.

**This section explains the provisions and the mechanism. It is not legal advice and does not

recommend a course of action in any individual case.** How the provisions apply depends on

what you actually knew at the time.

7 · What you are entitled to do

• **You are under no obligation to follow a stranger's instructions to move an unexplained

credit.** Nothing requires you to "process" an incoming payment for someone else, still less to

send it to an account they nominate.

• But leaving it alone is not the whole answer — s.25A imposes a separate duty. See section 6

above.

• The established route for a return runs between institutions, not through the recipient.

Under the HKMA's procedure the recipient's institution returns the funds to the sender's

institution and then to the sender; institutions have channels to verify and trace. By contrast,

a transfer made by the account holder over FPS is the (c) limb above.

• **A genuine mistaken transfer is reversed back along the path it came, not forward to a third

party.** An unrelated receiving account and a return to the original payer are not the same

thing.

• You may verify first. A Police Anti-Deception Coordination Centre press release

(1 January 2024) states that police officers and bank staff will never in any circumstances ask

members of the public to disclose personal or banking authentication details, or to transfer

funds to any account, and that the public may contact their bank or the Centre directly on

designated numbers to verify a caller's identity. The Centre's hotline is 18222.

• You may go to the police. Reporting before anything has gone wrong and explaining afterwards

are very different positions to be in. But stated precisely: **prior disclosure alone is not

sufficient; if the related act is then performed, s.25A(2)(a) also requires the consent of an

authorized officer to that act.**

If you or a family member is involved in such a case

• You have the right to remain silent and the right to ask for a lawyer — see Rights on arrest .
• Arrest or prosecution is not guilt: in Hong Kong everyone is presumed innocent until convicted by a court. Every case above was concluded.
• You have the right to apply for legal aid or the duty lawyer service — see the Legal aid guide .
• How bail works: Bail in Hong Kong .