In Tam Sze Leung & Ors v Commissioner of Police [2021] HKCFI 3118, the Court of First Instance found the longstanding practice of the Hong Kong Police in effecting an informal freeze against bank accounts through the use of “letters of no consent” (the No Consent Regime) to be unconstitutional.

The No Consent Regime as operated has hitherto provided a speedy and cost effective practical means of freezing funds in Hong Kong accounts, which has provided vital assistance to clients which have been the victims of online fraud cases (e.g. CEO fraud) at a time when these are prevalent in Hong Kong.  Unfortunately, we have a great deal of experience dealing with this kind of fraud – Hong Kong is very commonly used as a conduit for it. It is very easy for a newly established Hong Kong company to open a bank account in the territory, and given Hong Kong’s role in the global economy it appears that instructions by fraudsters to make payments to accounts held in Hong Kong banks have been acceptable as credible by all too many victims of phishing or other cyber frauds. Once the funds are paid into accounts here, in the words of the Hong Kong Court, they “can disappear at the push of a button“.

For a more detailed overview, please click here.

 

Gareth Thomas
Gareth Thomas
Partner, Head of Commercial Litigation, Hong Kong
+852 2101 4025
Hannah Cassidy
Hannah Cassidy
Partner, Hong Kong, Head of Financial Services Regulatory, Asia
+852 2101 4133
Rachael Shek
Rachael Shek
Partner, Hong Kong
+852 2101 4035
Peter Ng
Peter Ng
Senior Associate, Hong Kong
+852 2101 4238