Director of Public Prosecutions v Bariamis
[2013] VCC 1032
•28 June 2013
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CRIMINAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CR-12-01427
| DIRECTOR OF PUBLIC PROSECUTIONS (COMMONWEALTH) |
| v |
| LOUKIA BARIAMIS |
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JUDGE: | HIS HONOUR JUDGE LACAVA | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 21 February, 9 April, 27 May 2013 | |
DATE OF SENTENCE: | 28 June 2013 | |
CASE MAY BE CITED AS: | DPP v Bariamis | |
MEDIUM NEUTRAL CITATION: | [2013] VCC 1032 | |
REASONS FOR SENTENCE
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Subject: CRIMINAL LAW
Catchwords: Sentence – Dishonestly obtaining a financial advantage by deception
Legislation Cited: Criminal Code (Cth), Crimes Act 1914 (Cth), Sentencing Act 1991,
Cases Cited:DPP v Rowson [2007] VSCA 176; R v Gaitanis [1998] VSCA 57; DPP (Cth) v Gregory (2011) 250 FLR; R v Schwabeggar [1998] 4 VR 649; R v Lyndon Cockerell [2001] VSCA 239; Trowsdale v R [2011] VSCA; R v Merritt (2007) 14 VR 392; R v Grossi (2008) 23 VR 500; R v Verdins (2007) 16 VR 268; The Queen v Newton Chan (2010) 79 ACSR 189; DPP (Cth) v Peter John Couper [2013] VSCA 72
Sentence: 4 years’ imprisonment. Non-parole period 2 years.
Section 6AAA declaration: 6 years with a non-parole period of 4 years.
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APPEARANCES: | Counsel | Solicitors |
| For the DPP(Cth) | Mr D Lane | Solicitor for the Commonwealth Director of Public Prosecutions |
| For the Accused | Mr David Grace QC |
HIS HONOUR:
1 Loukia Bariamis, you have pleaded guilty to one charge of dishonestly obtaining a financial advantage by deception contrary to subsection 134.2(1) of the Criminal Code of the Commonwealth. The maximum penalty for this offence is 10 years’ imprisonment and/or a fine of 600 penalty units which equates to $66,000.00.
2 Section 16A(1) of the Crimes Act 1914 (Cth) (which I shall hereafter refer to as “the Act”) requires me in sentencing you to impose a sentence that is of a severity appropriate in all the circumstances of the offence. In addition section 16A(2) lists a number of matters which, if relevant and known to the court, must be taken into account in passing sentence. In passing sentence I have taken into account all relevant matters referred to in s16A(2).
3 Section 17A(1) of the Act provides that in passing sentence I shall not impose a sentence of imprisonment unless having considered all other available sentences, I am satisfied no other sentence is appropriate in all the circumstances of the case. I have considered all of the circumstances of your offending and your personal circumstances. I am satisfied no other sentence other than a term of imprisonment is appropriate.
4 Section 17A(2)(a) of the Act requires me in passing a sentence of imprisonment to state reasons why I am satisfied no other sentence is appropriate and s17A(2)(b) requires me to cause those reasons to be entered in the records of the court. These are my reasons and I direct they be entered into the records of the court.
5 Section 16A(2)(a) requires me to take into account the nature and circumstances of the offence you have committed. The charge that you have pleaded guilty to alleged that between the 9th of September 2004 and the 14th of June 2005, a period of approximately nine (9) months you lodged with the Australian Taxation Office (“the ATO”) 131 false Business Activity Statements (which I shall hereafter refer to as “BAS’s”) in the names of various companies, businesses and trusts. As a result Goods and Services Tax credits and PAYG tax credits to which you were not entitled amounting to $1,820,939.00 were paid to you. The charge rolls into one 131 instances of offending over the nine month period.
6 The circumstances of your offending are contained in a document entitled “Agreed Facts for Plea Hearing” which I admitted into evidence as Exhibit A on the plea. It was read in open court in summary form by the learned prosecutor Mr Lane and accepted by your counsel Mr Grace QC as being accurate and as forming a proper factual basis upon which I can proceed to pass sentence upon you. It is not necessary that I again refer to those documents here except in summary form. In passing sentence however I have had full regard to each of those documents and these sentencing remarks should be read in conjunction with what is contained in those documents.
7 Part of Exhibit A is a spreadsheet which summarises the transactions for each false BAS lodged by you as referred to in the charge on the indictment. Exhibit B consisted of two (2) folders of statements from the depositions which provide the evidentiary basis for what is contained in the spreadsheet and what is described in the agreed facts.
8 Your offending occurred in your position of trust as a registered tax agent and whilst you conducted an accounting practice in a partnership known as Greenfield Fox. As a registered tax agent you were able to access the Tax Agents’ portal through the website of the ATO. Having entered the Tax Agent’s portal you were able to falsify information that affected the tax liability of various tax payers. The false information was created by you and you knew that it would affect tax liability of the taxpayer. In each instance your intention was to obtain from the ATO a refund of GST or PAYG tax which was not otherwise payable and to obtain that refund not for your client but for your own use.
9 You started off by falsifying BAS’s lodged by entities connected with you and your family and the first 31 false BAS’s related to one or other of these family related entities. Of the remaining 100 false BAS’s lodged by you 94 related to the affairs of 17 commercial clients or, their associated entities, of your accounting firm Greenfield Fox. The remaining six false BAS’s which were lodged by you between 20 December 2004 and 6 June 2005 also related to entities connected with your family.
10 The falsities in the false BAS’s varied and consisted of 4 or 5 different false representations. Where the falsity was contained in a false BAS for one of your commercial clients there is no suggestion the client was ever aware that you had falsified the statement.
11 Most of the false BAS’s were lodged by you either late at night or in the early hours of the morning. In some instances multiple false BAS’s were lodged by you within minutes of each other on a particular day and the ATO acted on the false information lodged by you. In 116 instances, refunds of GST were made, in the other 15 instances refunds of PAYG were made or a mixture of GST and PAYG tax. These payments were made to four bank accounts controlled by you and nominated by you to the ATO. The two accounts into which most of the refunded tax obtained by your deceptions was paid were two old dormant trust accounts previously used by earlier iterations of your accounting firm. Again, where the refund was obtained by your falsification of the false BAS’s of your commercial clients, those clients were unaware that you had received the refund. When the funds were received you then transferred them to other accounts controlled by you.
12 By this means you dishonestly obtained from the ATO $1,820,939 in refunds to which neither you nor your clients were entitled to. You obtained $1,820,939 of money that belonged to the public. None of that money has been repaid. For the purposes of s16A(2)(e) of the Act in passing sentence I have had regard to the amount of money lost resulting from your offence.
13 Your offence amounts to a direct attack on the public revenue system. Your offence was clever, planned, well thought out and a gross breach of the trust placed in you by the ATO as a registered tax agent. It was also a gross breach of the trust placed in you by your various clients who retained you and your firm as accountant. You had been a registered tax agent since 1987. You more than most knew the responsibilities placed in you and you knew all along that by your offending you were breaching those responsibilities. Your offending was not limited in time or occurrence. You went to the well of the ATO on sixty-nine (69) occasions over a nine month period falsifying 131 BAS’s. You identified weaknesses in the ATO Tax Agent’s portal and you exploited them for your own benefit. Your conduct in this offence was deliberate, deceitful and dishonest.
14 You directed the money obtained from the ATO into accounts controlled by you. You then transferred the money into a total of thirty-two further accounts and credit cards also controlled by you. You kept your own records of your offending so that your offending was conducted in a business like way. You constantly monitored all of the accounts which you controlled. You stopped only when you knew that you had been detected.
15 Courts in this country have repeatedly said that offending that defrauds public revenue is very serious and courts when imposing sentences for these crimes must have full regard to application of the principle of general deterrence. See for example DPP v Rowson [2007] VSCA 176 per Justice Kaye especially at paragraphs [24 to 28] and the cases referred to therein. See also R v Gaitanis [1998] VSCA 57 per Justice Tadgell at page 13 and DPP (Cth) v Gregory (2011) 250 FLR at 182 to 184 and the cases referred to therein. This kind of offending is often difficult to detect and is complicated and costly to investigate. Offending of the kind and magnitude you have engaged in will almost always result in the imposition of a term of imprisonment. In passing sentence I have had regard to these principles.
16 You used some of the money paid to you for the payment of wages of staff of your accounting practice but the greater part of the money obtained by your deception was transferred via bank accounts controlled by you to numerous credit and debit cards held either in your name or that of your husband or were used to pay for gambling or for personal extravagant expenditure on items including clothing and accessories, shoes, jewellery, furniture and household goods, accommodation and travel and restaurants. Examples of the kind of spending engaged in by you are footnoted in footnote 20 at paragraph 29 of Exhibit A. I accept that most of the money dishonestly obtained by you was lost to gambling but you did indulge in extravagant expenditure also.
17 During the period of your offence you engaged in heavy gambling and much of the money obtained by you from your deception was lost to gambling. Records show that in the first six months of 2005 you gambled at Crown Casino for a total of 636 hours on 133 days. Your total buy in was $2,950,190.00. Your average bet was $890.00. Your total loss was $986,639.00. On a trip to Sydney where you attended the Star Casino between 9 and 13 June 2005 which was about one week before you were visited by the ATO about this matter you lost $33,670.00.
18 None of the proceeds have been recovered. The company that previously conducted your accountancy practice, Greenfield Fox Pty Ltd was placed into liquidation and wound up largely as a result of your fraud. Some staff members lost their jobs. Ms Ackland a salaried partner lost $250,000 she had used to purchase a share of the practice and in consequence she became bankrupt.
19 You were bankrupted in 2007 and discharged in August 2010. The prosecution seeks a reparation order against you for the amount lost by the ATO of $1,807,390.12. The making of that order was not opposed. I infer there is little chance of recovery of any money from you.
20 There has been delay in you being charged and bringing this matter before the court. The prosecution accepts that there has been unacceptable delay on the part of the ATO and in the investigation which cannot be attributed to you. The law says that this must be taken into account by a court and in most cases a reduction in sentence can be expected because of the unacceptable delay. You have had this matter hanging over your head one way or another now for a period of eight years. For that reason in passing sentence I have taken this delay into account.
21 Section 16A(2)(h) requires me to take into account the degree to which you have cooperated with law enforcement agencies in the investigation of the offence or of other offences. I heard and accept that you have cooperated fully in the investigation of this offence and of the investigation of other state offences which you have committed during the period of the delay in bringing this offence to court. I will deal with the latter investigation and your cooperation with it later. Here, it is necessary that I briefly refer to the sequence of the delay in bringing this matter to court and your cooperation with the investigation of this offence.
22 Your offending first came to the attention of the ATO on or about 21 June 2005. It was the number of amended BAS’s which resulted in the ATO paying money to you that drew attention. You were visited on that date and an investigation commenced. You did not respond to questions from investigators at that time.
23 On 10 August 2005 AFP officers and ATO officers executed a search warrant at your home and thousands of pages of documents were seized. Those documents formed the basis for further investigations and the obtaining of many witness statements. But it took six and a half years to complete the investigation.
24 You did not participate in an interview at any time. You did make some admissions however to your former partner Ms Ackland who made statements to the AFP.
25 On 31 August 2005 your then solicitors wrote to the ATO advising you were unfit to attend for interview and attached a medical certificate.
26 Nearly a year later on 23 August 2006 your solicitors again wrote advising you were unfit for interview notwithstanding your desire to cooperate and assist the investigation. The letter provided documentation which acknowledged on your behalf 106 of the 131 false BAS’s subject of the charge which it referred to as ‘unsubstantiated refunds”. The total sum of money involved in that disclosure was $1,612,019.00. There followed meetings between your then legal representatives and ATO investigators on more than one occasion to discuss the documents your advisers had furnished on your behalf.
27 On 28 May 2008 new solicitors acting on your behalf wrote to the Commonwealth Director of Public Prosecutions. The letter referred to your past cooperation and a disclosure document which you had provided. It also referred to your “ongoing fragile medical condition” and requested a meeting with your legal advisers present “at your convenience”. I admitted that letter into evidence as exhibit 1 on the plea. Despite this letter no meeting took place.
28 A follow up letter was despatched by your solicitors by fax on 15 September 2008. Again no meeting was arranged. I admitted that follow up letter into evidence as exhibit 2 on the plea.
29 Mr Grace submits that in passing sentence I must have regard to the inordinate delay in bringing this matter to court through no fault of your own. He relies primarily upon what Justice Vincent said in R v Schwabeggar [1998] 4 VR 649. The prosecution accepts that there has been unacceptable delay especially by the ATO in investigating this matter and accepts that I must take the question of delay into account. However, it argues that I must also have regard to what you have been doing during the course of the delay. In your case you have committed further state offences. In giving weight to the question of delay I have had regard to the fact that you engaged in other offending during the course of the delay.
30 The question of inordinate delay and the part it plays in sentencing was considered by the Court of Appeal in R v Lyndon Cockerell [2001] VSCA 239. In that case Chernov JJA (as he then was) said, inter alia:
“The judge must fix the sentence having regard to the gravity of the offence and of the offending, balancing against that the relevant mitigating factors, including the offender's personal circumstances and paying due regard to relevant sentencing principles. Subject to one qualification, his Honour did just that, as is plain from his sentencing remarks. In my view, however, the learned sentencing judge did not give sufficient weight to two related matters. One is the extraordinary delay in the prosecution of the offence which has not been satisfactorily explained but which, on any view, cannot be attributed to the applicant, and the other is his prospects of rehabilitation. But for that, the sentence was, in my view, well within the range of sentences that were properly available to his Honour.
I turn first to the effect on the sentencing disposition of the delay in the prosecution of the case. Given that the applicant has not offended since the date of the offence in question and has, therefore, gone a long way towards rehabilitating himself, the period of delay is to be reckoned from the date when the offending conduct took place to the imposition of the sentence - R. v. Miceli[1], R. v. MWH[2] and R. v. Todd[3] - namely, from October 1996 to October 2001, a period of some five years. In my opinion this plainly constitutes an inordinate period of delay which, as I have said, has not been satisfactorily explained.
The courts have been recognised that such delay which, as here, cannot be attributed to the offender, constitutes a powerful mitigating factor at a number of levels - see, for example, Miceli[4], Todd[5], R. v. Schwabegger[6], MWH[7], R. v. Blanco[8]. First, and perhaps foremost, where there has been a relatively lengthy process of rehabilitation since the offending, being a process in which the community has a vested interest, the sentence should not jeopardise the continued development of this process but should be tailored to ensure as much as possible that the offender has the opportunity to complete the process of rehabilitation. Secondly, from the point of view of fairness to the offender, the sentence should reflect the fact that the matter has been hanging over his or her head for some time, thereby keeping the offender in a state of suspense as to what will happen to him or her. Further, as Vincent, A.J.A. has pointed out in Schwabegger[9], there is an obvious inconsistency between the claim by the prosecution that the offence is a serious one on the one hand and the seemingly leisurely progress of the prosecution on the other, leading to a justified sense of unfairness in the offender. As Wood, C.J. at CL said in R. v. Blanco[10]:
‘... it remains the fact that it is highly desirable that the prosecuting authorities act promptly where they have evidence of serious criminality. If they fail to do so, then they must expect that circumstance to be taken into account in sentencing. It is in the public interest that those who are suspected of serious criminality be brought to justice and be brought to justice quickly, particularly where there is a strong case available against them.’
All the above factors to which I have referred operated in this case and, therefore, the delay in this case was a powerful mitigating factor that had to be given due recognition in the sentencing disposition.
Moreover, as I have said, the applicant's rehabilitation has progressed since the offending and there seems to be a real prospect that, with time, he may be fully rehabilitated. This is a very important factor that must be properly reflected in the sentence.”
[1][1998] 4 VR 588 at 591 per Tadgell, J.A. with whom Winneke, P. and Charles, J.A. agreed
[2][2001] VSCA 196 at [18] per Callaway, JA
[3][1982] 2 NSWLR 517 at 519-520 per Street, CJ
[4]at 591
[5]Fn. 3
[6][1998] 4 VR 649 at 659 per Vincent, AJA
[7]Fn. 2.
[8](1999) 106 A Crim R 303 at 306 per Wood, CJ at CL with whom Bell, J and Smart, AJ agreed
[9]at 659
[10]at 306
31 In Cockerell President Winneke and Justice Buchanan agreed with the principles expressed by Chernov JJA.
32 More recently, in Trowsdale v R [2011] VSCA the court referred with approval to R v Merritt (2007) 14 VR 392 and what President Maxwell there said relevant to delay saying at paragraph [10]
“As Maxwell P pointed out in R v. Merritt, the relevance of delay as a sentencing factor is not determined by whether the delay is justifiable or unjustifiable or – as in this case – inordinate, but rather what the prisoner has done during the period of delay to demonstrate actual or prospective rehabilitation.”
33 There are numerous other cases where the Court of Appeal has recited these principles.
34 You were originally charged with 190 charges of dishonestly obtaining a financial advantage by deception on 1 March 2012. On 8 August 2012 you were committed for trial on all of the 190 charges by way of a straight hand up brief. You pleaded guilty at the committal to the 131 charges now rolled up in the one charge on the indictment and, not guilty to the other 59 charges.
35 On 17 October 2012 the prosecution filed the indictment containing the charge that you pleaded guilty to in this court on that day. It is a rolled up charge that relates to the same offending that you pleaded guilty to in the Magistrates’ Court when committed for trial.
36 Section 16A(2)(g) requires that I must have regard to the fact that you have pleaded guilty to the charge and I have done so. I treat you as having pleaded guilty to the charge at the first available opportunity. By your plea you have saved the time and costs of what would have been a lengthy trial. I note the indictment contains the names of 42 witnesses that may have been called if the charge proceeded as a contested trial. Any trial on these matters would have been lengthy and costly. By your plea of guilty you have facilitated the administration of justice. For that you are entitled to a reduction in sentence and this is reflected in the sentence that I will shortly pass.
37 In passing sentence I accept that from about the end of August 2006 onwards through your solicitors you offered to and did cooperate with the investigation. I also take into account a paper you prepared entitled “Instructional Paper on How to Successfully Fraudulently amend Business Activities Statements (BAS’s) using the ATO’s Tax Agent Portal” which I admitted into evidence as exhibit 7 on the plea as further cooperation by you with the investigation of your offending. In fact you provided this paper to the ATO whilst accompanied by Detective Lal from the Victoria Police Fraud and Extortion Squad at a meeting at the ATO which occurred on 17 April of this year after the first day of the plea. A letter from one Alan Adair from the ATO which went into evidence as part of exhibit 9 indicates you were friendly and cooperative at this meeting. It also indicates that your paper did not inform the ATO of any tax portal issues of which it was not already aware. I accept however your paper demonstrates cooperation and I have taken it into account in arriving at my sentence.
38 You gave evidence before me and gave an undertaking to give evidence in any trial or proceeding against others involved in the further state offences of which you have been charged and pleaded guilty. Exhibit 10 is a copy of indictment filed in the Supreme Court by the Victorian Director of Public Prosecutions in which you are charged with three charges of obtaining a financial advantage by deception. You have pleaded guilty to those charges and Justice Lasry will hear your plea on those matters in July next.
39 The offending in those charges occurred between 13 November 2009 and 26 November 2010.
40 Charge 1 alleges you obtained a financial advantage namely financial lending facilities from the Commonwealth Bank (“CBA”) in an amount of $12,150,000.00 for yourself or another. A number of companies that may collectively be referred to as the Viking Group are there named.
41 Charge 2 is a similar charge where the amount involved is $17,400,000.00. Charge 3 is also similar. The amount involved is $4,000,000.00 obtained for a company Viking Asset Management Proprietary Ltd.
42 The Viking Group is now in liquidation. The companies were previously controlled by one Steven Illiopoulos for whom you had in earlier years acted as accountant. Illiopoulos has also been charged with the same state offences that you have been charged with and other offences related to money borrowed by the Viking Group and Viking Asset Management Proprietary Ltd as has your husband Bill Bariamis. It is not necessary that I go into detail here of the facts of the failure of the Viking Group or indeed your offending relating to it. I touch upon it to deal with the issue of your cooperation in the police and other investigations of that group of companies and of Mr Illiopoulos.
43 You gave evidence which I accept and act upon to cooperate fully with law enforcement agencies in relation to the investigation and hearing of charges relating to the Viking Group and to give evidence in accordance with a statement attached to a written s21E undertaking in writing. I admitted that undertaking and statement into evidence as exhibit 6. I accept you have given other statements to the police. I have read exhibit 6 in detail.
44 Detective Senior Constable John Lal of the Victoria Police Fraud and Extortion Squad gave evidence about your cooperation with authorities relating to the Viking Group of companies controlled by Illiopoulos. He gave evidence your 82 page statement (exhibit 6) contains full and frank admissions about your offending and the offending of Mr Illiopoulos relating to the Viking group. He told me there were also other statements prepared and signed by you relating to those matters. I accept this evidence and act upon it.
45 Detective Lal also gave evidence which I accept that you had provided a statement concerned with the bashing of the solicitor of Mr Illiopoulos' estranged wife and the involvement of Mr Iliopoulos in that bashing. He gave evidence your statement in relation to that matter corroborates other evidence police have with regard to that assault.
46 Detective Lal gave further evidence which I accept that you have also made a statement in relation to the concealment of assets of the Viking Group by Mr Illiopoulos and others including members of the Comanchero Motor Cycle Gang. Detective Lal gave evidence which I accept that Mr Illiopoulos has links with that gang. For this reason and others Mr Illiopoulos remains in custody and his bail is opposed because police have concerns that he is an unacceptable risk of interfering with witnesses. Detective Lal gave evidence which I accept the police have fear that if Mr Illiopoulos were released from custody they would have fears for your safety. You told me in evidence and I accept that you have good reason to be in fear, namely you have knowledge that Mr Illiopoulos and his associates are known to hurt people who oppose them. You told me no one has threatened you thus far.
47 Detective Lal gave evidence he was satisfied the statement you have made concerning the concealment of assets in the Viking group also implicates a person by the name of Malkoun. He said the information provided by you is insightful and corroborated by other evidence. He said he has no reason to discount your undertaking to give evidence against others in other matters. In cross-examination, he said you were a principal offender with Illiopoulos in the Viking matters. He gave this evidence at transcript 109:
Q:“Is the provision of that statement, the main statement that has been tendered in evidence today in your experience unprecedented for such a statement and exhibit to be prepared in that manner?---
A:Your Honour, I've never had a defendant supply me an extensive document supported with exhibits ever in my policing career to that - to that extent.
A:You've heard her give evidence here this morning about her fear for her safety and that of her family?---
A:I heard that.
Q:Do you believe that fear is justified?---
A:Yes, I do.
48 In arriving at an appropriate sentence I have reduced the head sentence and the non parole period I would have imposed because of your cooperation with police and investigators thus far in relation to the Viking Group charges and your undertaking of future cooperation. I have taken into account the fact that by your cooperation and undertaking you have likely placed yourself in a situation of danger. I have also taken into account the fact that because you have undertaken to give evidence against others any sentence you serve will most likely have to be served in protective custody.
49 In your statement attached to exhibit 6 you detail your dealings with Illiopoulos. The statement indicates that from about October of 2005 onwards you began to have further dealings with Illiopoulos and you assisted him with your accounting knowledge of his business affairs. Illiopoulos’s companies were the subject of a tax audit and you were asked to assist. You did so and eventually took up a position full time for a number of years as the Chief Financial Adviser of the Viking Group. It was in that role that you committed the state offences which are in the nature of falsification of accounts and creating false debtors in order to inflate the asset value of the group to assist in applications for and ongoing finance from the CBA.
50 Like the offending for which I sentence you, the state offences involve your work as an accountant. Without judging what you did in those offences and, based upon what is contained in your statement, exhibit 6, your state offending would also appear to be planned, sophisticated, deliberate, dishonest and involved deception at a high level. This is relevant in my judgment for two important issues. Firstly, the state offending occurred whilst there was delay in the investigation of the federal offence. Rather than setting about to rehabilitate yourself you engaged in further offending during the course of the delay. Secondly, Mr Grace relies upon your mental state at the time of the commission of the federal offence. In my view the evidence shows that notwithstanding the fact you may have been suffering depression at the time of the commission of the federal offence you were still able to operate as an accountant and registered tax agent and operate an accounting practice as well as doing all of the complicated things necessary to complete the fraud and keep track of the proceeds. I do not accept your judgment was impaired at the time of the commission of your offending to such an extent that you did not have a proper appreciation of what you were doing.
51 The evidence in your statement shows that as late as 2009 and 2010 notwithstanding the fact you may have been suffering from some depression you were again still able to do all that was necessary as an accountant and chief financial officer to perfect the fraud encapsulated in the state offending.
52 Your statement reveals that you worked for Mr Illiopoulos from 2007 until 2011 as chief financial officer for little or no reward apart from some payments from time to time and some credit card use. During all of this time you were an undischarged bankrupt. I do not accept you did all of this work for Illiopoulos because you felt obligated to him because of the trouble you had caused in falsifying BAS statements for companies controlled by him.
53 It is appropriate that I now turn to your personal circumstances and particularly the issues concerning your physical and mental health about which a great deal of evidence was produced. Section 16A(2)(m) of the Act requires me to take into account in passing sentence your character, antecedents, age, means and physical or mental condition.
54 Dealing with your character prior to the federal offence you had no prior convictions. As Mr Lane pointed out such is usually the position with white collar criminals in a position of trust. The position of trust almost always derives from the fact that the person has no prior convictions and is generally regarded as being of good character. Nevertheless it is a factor that I take into account.
55 Anna Vagias gave character evidence on your behalf. She has known you for many years. She said when she found out about your offending she regarded it as totally unexpected and totally out of character for someone that she said “had such a commitment to doing the right thing, very strong values of doing the right thing particularly for her customers and her clients and within her profession”. She said she discussed your offending with you and she gave evidence of your reaction. She gave evidence you were “extremely mortified” by the fact that you had committed the offence. She gave evidence that when she first spoke with you, you expressed feelings of guilt and shame. She said that she noticed you suffering depression first around the time of the partnership issues in the early 2000s. I accept the evidence of Ms Vagias.
56 Ann Makrigiorgos also gave character evidence on your behalf. She has known you since 1977 when you were at school together. She gave evidence about what she called the “crazy hours that you worked”. She said she was shocked by the revelations that you had been gambling heavily and had committed this offence. She said you have expressed remorse and shame to her. I accept her evidence.
57 Section 16A(2)(f) of the Act requires me to take into account in passing sentence the degree to which you have shown contrition for your offence. I find you have expressed appropriate remorse or contrition for your offence to your family and friends, to doctors and psychologists that have consulted with you and in your statement exhibit 6. In particular Mr Cummins opined that he thought you were very remorseful for your conduct and I accept that to be the position.
58 You are 51 years of age and were born at Yallourn on 14th of October 1961. You were born into what Mr Grace described as a traditional Greek Orthodox family. Your father and uncle worked at the Yallourn open cut. The family lived a modest existence with two families effectively living in the one house. You were the eldest child and you assisted with housekeeping and cooking.
59 Your parents did their best working hard to ensure you had a good education. You attended a local State primary school in Yallourn and then high school where you struggled. In the 1970’s the family moved to Dandenong where you attended Lindale High School and completed your Higher School Certificate in 1979. After that you commenced a Bachelor of Business course at Gippsland Institute of Technology majoring in accounting. You then transferred to the Chisholm Institute which later became Caulfield Technical College now a campus of Monash University where you completed your tertiary studies in accounting.
60 You were thereafter employed by Myers and the SEC and you worked part time three or four nights per week for an accountant. You married your husband Bill in 1984. You left the SEC in 1986 and worked for a machinery component company and then you worked full time for an accountant Ray Reagan. In 1990 you commenced employment with Greenfield Fox an accounting firm in which you were later to become senior partner and where you committed this offence.
61 In 1991 you purchased 20% of the partnership for $270,000 believing it to be a good practice with a good future. Your husband was a banker with the National Australia Bank.
62 In 1993 your daughter Anthea was born. She is now a third year Arts student at Melbourne University.
63 In 1994 you first consulted a psychiatrist for what Mr Grace described as “work related issues” which meant stress caused by a heavy work load and family stress.
64 In 1995 the Greenfield Fox practice merged with the practice of Mr Reagan. Around that time you and your husband commenced to build a new family home at Glen Waverley.
65 In 1996 your son Ross was born. He is now 17 years of age and a student at a private school in the eastern suburbs. He suffers from Asperger’s syndrome a form of autism and he requires he requires a lot of assistance especially with social gatherings.
66 In the mid 1990’s your father suffered a heart attack and you and Jill Johnstone formed a new accounting partnership. I was told by Mr Grace on instructions and accept you were working long hours.
67 Mr Grace relied upon the contents of a large number of medical reports which were all tendered in a folder which I marked as exhibit 3 on the plea. Mr Grace summarised the relevant parts of those reports and they are largely summarised again in the detailed report of Mr Jeffrey Cummins dated 20 February 2013. Mr Cummins has been treating you since 21 November 2008.
68 In passing sentence I have had regard to the full contents of all of the medical reports contained in exhibit 3. Mr Grace relied upon these reports to demonstrate that you had a number of physical medical problems that are documented and date back to the mid to late 1990’s. He submitted these numerous health problems and work problems and pressure of work as well as family issues operated as stressors and increased your stress levels. I accept that to be the position.
69 In August 1999 Kathryn Ackland and Darren Wilson joined your accounting partnership and Jill Johnson left. I was told and accept the practice was not going well and there followed further partnership changes. There were apparently cash flow problems. In 2003 a partner Webb left the partnership which was described in court as a ‘disaster’. Various changes in the partnership resulted in a great deal of upheaval and the management of it all fell to you causing you stress. In addition your husband advanced $140,000 to assist with working capital and cash flow requirements.
70 In January 2004 your mother in law committed suicide by hanging at your home. I accept the occurrence of that event would have placed stress on you and your family.
71 In June 2004 you had what Mr Grace described as a “nervous breakdown”. You could not get out of bed and did not return to work for some months. The practice suffered because you could not work. I was told this offending commenced whilst you were at home re-couperating.
72 At Tab 4 of exhibit 3 is a medical report dated 31 January 2013 fro Dr Roslyn Quill a general practitioner at the Wheelers Hill Clinic whom you consulted intermittently between 1998 and 2002 and then in July 2004. Dr Quill reports you mentioned your symptoms of anxiety and stress to her on 19 July 2004 after mentioning them three days earlier to another doctor at the practice. Dr Quill reports you explained to her you were suffering work stress from long hours and end of financial year busyness as well as problems with a work colleague. There is no mention by Dr Quill of you having told her of your excessive gambling. She reports you declined medication but proceeded on sick leave and continued with counselling. Dr Quill’s diagnosis at that time was of a moderately severe anxiety/depression requiring sick leave, psychological treatments and probably pharmaceutical treatment.
73 Dr Quill reports further consultations through late 2004 where your condition at first improved but then deteriorated. When she saw you on 24 June 2005 she thought you were close to breakdown. The last act in your offending occurred on 6 June 2005. When you consulted Dr Quill on 24 June 2005 that was but three days after the ATO had attended your office having detected your crime. It was but 14 days after you had attended the Star Casino in Sydney for the weekend. Dr Quill reported:
“There had been a dramatic exacerbation of her depression, and she agreed to commence an antidepressant. She had been continuing to see her counsellor through this period, but I have no correspondence from him. She told me at that appointment that she had made a mistake at work, was not able to concentrate, could not sleep etc.”
74 On 27 August 2005 Dr Quill referred you to a psychiatrist and changed your medication. The ATO had executed a search warrant at your home on 10th August 2005. Dr Quill saw you on 19th September 2005. You told Dr Quill at that consultation for the first time of the ATO investigation and that you had done nothing wrong.
75 You have been treated by a number psychiatrists and psychologists since this offending. You have been hospitalised in the Melbourne Clinic on three occasions in the last year for 7 weeks in April/May, 4 weeks in July and 4 weeks in July/August 2012. On 26 November 2012 Professor Burrows who treated you at the Melbourne Clinic described you as being quite vulnerable and of in need of ongoing psychological and psychiatric care. In a very brief report he opined, inter alia, “Her mental state would have contributed significantly to her behaviour”.
76 Mr Grace relies upon the opinion of Mr Cummins which I referred to earlier. He has been treating you and you have consulted with him more or less monthly since November 2011. He has documented all of your medical history and your family and business history and has used that background in forming his opinion.
77 At page 9 of his report Mr Cummins opines, inter alia:
“She has a lengthy and documented history of suffering from depression, and in my opinion, the overriding diagnosis for Ms Bariamis is that of major depressive disorder recurrent. There is also an ancillary diagnosis of generalised anxiety disorder. In my opinion, at the time of the offending, she was also suffering from pathological gambling disorder.
I appreciate there's recently been considerable controversy associated with the application of Verdins principles. I acknowledge the applicability or otherwise of these principles as ultimately to be determined by the court. Suffice it to say, it is my opinion at the time of offending, she was suffering from a mental condition which affected her perception and judgment. Furthermore, in my opinion, there was a nexus between her suffering from a major depressive disorder and her desire to elevate her mood by gambling, by sometimes being reckless with money fraudulently obtained through buying friends and acquaintances gifts, and through sometimes overspending on herself.”
78 Offending motivated by a gambling addiction or pathological gambling disorder, does not alone necessitate any reduction in the moral culpability of the offender or amelioration of the application of general deterrence. See R v Grossi (2008) 23 VR 500 at paragraphs [47] to [57]. Mr Grace conceded that this was the position at law. But he argued that at the time of offending you were suffering from a major depressive disorder which affected your perception and judgment and you engaged in the gambling as a way of relieving your depression. In those circumstances he argued each of the six principles referred to in R v Verdins (2007) 16 VR 268 applied so that in sentencing you I should regard your moral culpability as having been reduced within the first principle in Verdins.
79 Mr Lane in submissions accepts that you now suffer from a major depressive disorder. But he argues there is no evidence which provides a nexus between your a major depressive disorder and your pathological gambling addiction to the actual commission of this offence. He submits your offending, as was the case in Grossi, was premeditated, calculated and systematic and carried out over a long period of time.
80 In passing sentence I accept the prosecution arguments. Whilst I accept that you are now suffering from a major depressive disorder I do not accept the evidence of Mr Cummins that at the time of offending you were suffering from a mental condition which affected your perception and judgment. You well knew what you were doing. You were able to access the ATO tax portal and manipulate the figures on 131 Bas statements over a nine month period. After that offending was revealed you were able to go and act as the chief financial officer for the Viking Group. At the time of offending you may have been suffering depression but when all of the circumstances are examined I have formed the strong view you were still able to function at a high level as an accountant. The level of your depression according to the evidence seems to have risen immediately after the commencement of the ATO investigation on 21 June 2005 and again in 2011 by investigation of your involvement in the Viking offending.
81 However, whilst I do not accept the argument advanced by Mr Grace concerning application of principle 1 in Verdins in passing sentence I have had regard to the need to take into account and apply the remaining Verdins principles. I understood the prosecution to agree with this approach. In passing sentence I have taken into account the fact you now suffer from a major depressive disorder in arriving at the length and kind of sentence I will impose. In particular I have taken the view that a sentence of imprisonment will weigh more heavily on you because of your depression and there is a risk of imprisonment affecting your mental health. For these reasons I have mitigated the sentence I will impose.
82 I received into evidence medical reports relating to a suspected cancerous lump in your breast. Fortunately a biopsy and pathologist tests revealed this to be an area of benign fibrocystic change. Exhibits 8 and 9.
83 Mr Grace submitted a period of imprisonment will have consequences for your family especially your son but he conceded those consequences did not amount to exceptional circumstances within 16A(2)(p) of the Act.
84 Section 16A(2)(n) of the Act requires me to take into account your prospects for rehabilitation and s16A(2)(j) requires me to take into account the deterrent effect of any sentence upon you. I have concluded you have good prospects for rehabilitation and I believe you unlikely to again offend in this way. There is no need for my sentence to reflect specific deterrence.
85 Mr Grace conceded your offending was serious but submitted your moral culpability was low because your judgment was impaired by depression. As I have said I reject that submission. Mr Grace relied upon all of the mitigating factors I have set out above including:
· The delay in charging you and bringing this matter to conclusion;
· Your cooperation with the investigation and your cooperation to date with the investigation of the Viking offences and you undertaking of future cooperation;
· Your plea of guilty at an early time;
· Your remorse;
· Your good prospects for rehabilitation;
· Your previous good character and the fact you have good family, friends and antecedents.
86 In those circumstances he submitted I should consider convicting you and sentencing you to a short term of imprisonment and releasing you immediately on a recognizance release order. I have considered this submission and consider it inappropriate in all of the circumstances.
87 I did not ask the prosecution to address me on sentencing range. Mr Lane submitted the only appropriate disposition was the imposition of an immediate term of imprisonment having regard to the nature of your offending including, the amount involved, the period of time over which the offending extended and the breach of trust as a tax agent both of the ATO and clients. I agree with this submission which as I said earlier is consistent with a number of authorities dealing with fraud involving public money.
Sentence
88 On the charge of dishonestly obtaining a financial advantage by deception contrary to subsection 134.2(1) of the Criminal Code of the Commonwealth you are convicted and sentenced to a term of imprisonment of four (4) years.
89 Pursuant to s17 of the Sentencing Act 1991, the sentence imposed by me commences this day.
90 Pursuant to s19AB(1)(d) of the Act, I fix a period of two years before you are eligible for release on parole.
91 I declare that you have already served 31 days pre-sentence detention and I direct and order that 31 days be reckoned as having been already served under the sentence imposed by me this day and deducted administratively.
92 Section 6AAA of the Sentencing Act 1991 and s21E of the Act require me to quantify the reduction in sentence I have made in passing sentence having regard to your plea of guilty and your s21E undertaking. In fulfilling this requirement I have followed the approach taken by His Honour Justice T Forrest in The Queen v Newton Chan (2010) 79 ACSR 189 a decision that was referred to with approval by the Court of Appeal in DPP (Cth) v Peter John Couper [2013] VSCA 72 per Justice Tate at paragraphs [141] to [145].
93 Had it not been for your plea of guilty to the charge, I would have imposed a head sentence of six (6) years imprisonment and I would have fixed a non parole period of four (4) years. In arriving at my sentence, I have deducted 12 months from the head sentence and 12 months from the non parole period because of your plea of guilty.
94 For the purposes of s21E of the Act, in arriving at my sentence I have deducted a further 12 months from the head sentence and a further 12 months from the non-parole period because of your s21E undertaking.
95 Section 16F of the Act requires that I explain the sentence I have imposed to you. The sentence I have imposed is four (4) years’ imprisonment. You will have to serve at least two years of that sentence in prison before you are eligible for release on parole into the community to complete service of the sentence. If a parole order is made it will probably be on conditions which you will have to comply with. A parole order maybe amended or revoked. If you fail to comply with the conditions of a parole order without reasonable excuse a consequence may be that you will be returned to prison to complete the sentence I have imposed.
96 I have signed an order for reparation which was not opposed.
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