CLD Case Commentaries

Money Mules: PP v Razali Bin Mohamed Idris

A money mule is a person who receives and transfers money, often of criminal source1. They could be either stolen or fraudulently obtained. He or she will then be asked to deliver money to another person, either in cash or by electronic means. Most offenders are very much a victim of their own crime as National Crime Prevention Council (“NCPC”) noted in a press release that most of these offenders were conned into doing so. For instance, some individuals may have innocently trusted conmen they have befriended online while some may be in for a “quick cash”. After trust has been established, these scammers would proceed to transfer the money to these victims’ personal accounts before asking the victims to transfer the money to another account. This is often done by much larger syndicates to facilitate money-laundering. The same NCPC press release also reported that this is a growing trend with 93 such cases2 in 2012 and an increase to 133 cases in the first nine months of 2013 alone. Although there is no information concerning the number of individuals prosecuted, there is no dearth of cases either. This article seeks to clarify the relevant legislation and the potential offences a money mule is liable for, as well as the rationale behind the harsh sentencing guidelines.

We first take a look at a recent case of Public Prosecutor v Razali Bin Mohamed Idris3 (“Razali”). It aptly demonstrates how a common individual can be jailed for handling money for an online acquaintance. The accused, Razali Bin Mohamed Idris was a 56-year-old Singaporean. He befriended with “Rose” through the internet. Razali gave Rose his bank account number, and agreed to help Rose by receiving a sum of money into his bank account. On 11 September 2013, a sum of S$171,091.25 was transferred into his account. It is not disputed that this money had been obtained fraudulently. On the instructions of Rose, he made transfers of varying amounts to company and individual he did not know. It was added that he had never received such a large sum before. He was charged for one count of dishonestly receiving stolen property under s 411(1) of the Penal Code (“PC”) and four count removing from jurisdiction the benefits from criminal conduct, under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (“CDSA”). He was guilty of all charges. We now examine the legislation for each charges.

As per Razali, a money mule can be liable for dishonestly receiving stolen goods under section 411  of the Penal Code (“PC”). This provision can be divided into the physical and mental element. In the physical one, there is a requirement to “receive or retain stolen property”. The general inquiry is whether the accused was in possession of the stolen property. It is noted that the word “retain” ensures that the accused had a sufficient level of conviction to hold on to the stolen property. It is also easier in practice to prove retention than mere receipt4. Section 410 also defines “stolen property”. The property must have been a subject of one of the nominated offences such as theft, extortion and criminal breach of trust. It is also not necessary for it to be a physical property which is why money mules can be guilty of this section 411. Subsection (2) of section 411 denotes that the expression “stolen property” includes any property that has been exchanged for or converted into. This includes proceeds from sales of the stolen property5.

In most cases, the element of dispute for section 411 is the mental element. The prosecution must prove two requirements of the mental element — (i) dishonesty and (ii) knowing or having reason to believe that the property was stolen. In Razali, the issue before the court was whether the defendant had “reason to believe” if the property was indeed stolen. The district judge applied the legal test of “reason to believe” set out in Ow Yew Beng v PP6 (“Ow Yew Beng”). The test is an objective one: whether a reasonable person, in the position of the defendant (including his knowledge and experience), would have thought it probable that the property he retained was stolen property. The court ruled that the defendant in Razali had reason to believe to believe that the money he received was stolen on several basis. The court found “the the defendant was not naïve and gullible, but reasonably intelligent and street-smart” to discern if the property was stolen. It was also found that the circumstances under which the large amount of funds that had been transferred into the defendant’s account should be suspicious for the defendant, insomuch that there is a reason to believe that the money was stolen. Unlike the “reason to believe” limb, the knowledge limb under element (ii) is a subjective enquiry which could be harder to prove in practice.  Knowledge denotes awareness of certain facts with absolute conviction or certainty as to their existence. It can be said that a high degree of conviction is necessary to establish knowledge7

Where the penal code punishes money mule for receiving money, the CDSA is the primary legislation for targeting subsequent transfers of funds. In the CDSA, section 46 deals with benefits from drug dealing while section 47 deals with benefits stemming from criminal conduct. For example, under section 47(2) any person who:

  • knowing or having reasonable grounds to believe that:
  • any property (in whole or in part, directly or indirectly) represents, another person’s benefits from criminal conduct;
  • conceals or disguises that property; or
  • converts or transfers that property or removes it from Singapore.


This subsection specifically targets a person handling the benefit from a criminal conduct (rather than from a drug dealing) on behalf of another person (rather than his personal benefit). The first two element makes up the mental aspect of the offence while the last two elements constitute the physical element of money mule. As with section 411 of PC, the prosecution must prove that the defendant had knowledge or reason to believe that the property in question stems from another person’s criminal conduct. Although the definition of “reason to believe” cannot be found in CDSA, it is defined in the PC. A person is said to have “reason to believe” something, if he has sufficient cause to believe that thing, but not otherwise”. Indeed, the second part of element (a) of having “reason to believe” expands the scope of mere knowledge and provides for a more workable approach as it may be unrealistic to prove actual knowledge.

The second element requires the property in question to be a benefit from another person’s criminal activity. Further, this property can be in full or in part. It must be noted that this has been widely defined to capture a large array of possibilities. This can be confirmed by the bill passed in 2014, seven years after the original CDSA was passed. The said bill added section 47A to the statute8. It states as follows:—

47A.—(1)  For the purpose of proving under this Part whether the whole or any part of any property constitutes, or directly or indirectly represents, the benefits of drug dealing or the benefits from criminal conduct, it is not necessary for the prosecution to prove the particulars of any offence constituted by the drug dealing or criminal conduct.

 

(2)  For the purpose of proving under this Part whether a person knows or has reasonable grounds to believe that the whole or any part of any property constitutes, or directly or indirectly represents, the benefits of drug dealing or the benefits from criminal conduct —

(a)   it is sufficient for the prosecution to prove that the person knows or has reasonable grounds to believe that the whole or part of the property constitutes, or directly or indirectly represents, the benefits of an offence generally; and

(b)   it is not necessary for the prosecution to prove that the person knows or has reasonable grounds to believe that the whole or part of the property constitutes, or directly or indirectly represents, the benefits of a particular offence.

 

Under subsection (1), it is not necessary for the prosecution to prove the specific details or make out a specific offence from the criminal conduct. It is sufficient that the conduct has occurred. More interestingly, a similarly low threshold is set out in subsection (2). The prosecution only has to prove that the defendant knows or has reasonable grounds to believe that the property represents the benefit of an offence in general. The said offence need not be a particular offence of criminal nature or whatsoever. The requirement of proof is deliberately widen to allow offenders to be prosecuted more easily. This wide requirement is also observed in the physical element of the offence. No method of transfer is specified. In this regard, an offence for removing the the benefits of criminal conduct from the jurisdiction can easily be made out.

A person guilty of section 411 of the PC can be punished with imprisonment up till 5 years and be liable for a fine. The primary consideration for sentencing appear to be the total quantum for instance, a 10 months sentence was imposed for an amount of $97,177.869 while a higher quantum of $197,044.73 attracted a 17 months jail term10. The sentencing for section 46 and 47 of CDSA is also quantum dependent. Some of the suggested aggravating factors include the offence being pre-meditated; the offences were committed over a period of time and if a large amount was involved. Deterrence also appears to be a prime consideration when sentencing  as such offences can damage the country’s reputation as a financial hub[11]. Indeed with increasing ease of making transfer, there is a need to impose harsh sentence to deter similar offences from being committed. As technology evolves, legislation must also keep up and remain future-proof. One such development is the rise of cryptocurrency. These developments allow monies to be transferred and converted anonymously. It becomes more urgent than ever before to ensure that monetary transactions are regulated.

Written by Chee Kai Hao

 

[1] Public Prosecutor v Darryl Ignatius Tan Yung Sheng [2014] SGDC 81

[2] http://www.ncpc.org.sg/downloads/mediarelease/22-Nov-2013_Media_Release_on_Money_Mules.pdf

[3] [2017] SGDC 22

[4] YMC [15.6]

[5] Cheah Yew Fatt v PP [1960] MLJ xlvi

[6] [2003] 1 SLR(R) 536

[7] YMC [4.18]

[8] Act 21 of 2014

[9] PP v Rohinton Rustom Kakaria

[10] PP v Gee Lee Cheng [2013] SGDC 401

[11] supra 3 at [45]

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