Director of Public Prosecutions v Boyton
[2015] VCC 1341
•22 September 2015
IN THE COUNTY COURT OF VICTORIA Revised
Not Restricted Suitable for Publication
AT MELBOURNE CRIMINAL JURISDICTION
Case No. CR-15-00800
DIRECTOR OF PUBLIC PROSECUTIONS
v
JOASH BOYTON
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| JUDGE: | HIS HONOUR JUDGE MCINERNEY |
| WHERE HELD: Melbourne | |
| DATEOF HEARING: 12 August 2015 | |
| DATEOF SENTENCE: 22 September 2015 | |
| CASE MAY BE CITEDAS: DPP vBoyton | |
| MEDIUM NEUTRAL CITATION: [2015] VCC 1341 | |
REASONS FOR SENTENCE
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Subject: CRIMINAL LAW
Catchwords: Sentence – attempted obtaining financial advantage by deception – attempted obtained property by deception – obtaining financial advantage by deception – obtaining property by deception – perjury – using identification information – supplying identification information – making identification information – conspiracy to cheat and defraud – possession of data with intent
Legislation Cited: Criminal Procedure Act 2009 (Vic), Sentencing Act 1991 (Vic), Crimes Act 1958 (Vic)
Cases Cited: Boulton v R [2014] VSCA 342, DPP v Tokava [2006] VSCA 156, R v Merritt, Piggott & Ferrari [2007] VSCA 1, R v Zarrinkafsh [2005] VSCA 22, DPP v Bulfin (1998) 4 VR 114, R v Tsiamas & Kastanis (unreported, VSCA, No.25/26 of 1997, 21 May 1997), R v Bainbridge, Cullen & Ludwicki (1994) 74 A.Crim.R 265
Sentence: Convicted and sentenced to 4 years and 9 months imprisonment with a non-parole period of 2 years and 6 months imprisonment
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APPEARANCES: Counsel Solicitors
For the Director of Public Prosecutions
Ms A. Moran Solicitor for the Office of Public Prosecutions
For theAccused Mr P. Tiwana Dribbin & Brown Criminal Lawyers
HIS HONOUR:
1Joash Boyton is aged 23, having been born on 1st day of November 1991. In this plea hearing, Ms Moran appeared on behalf of the Director of Public Prosecutions and Mr Tiwana, on behalf of the prisoner.
2The circumstances in regard to the plea were that Mr Boyton pleaded guilty to Charge 1 in the Indictment, that is Indictment No.E12232810 and pursuant to the provisions of s.216 of the Criminal Procedure Act 2009, a written plea was accepted by the Court, and the prosecution, to the remaining 33 charges in the Indictment.
3Insofar as this offending, it took place in the period when Mr Boyton was aged 17 through to 20. That is a period from 1 May 2009 through to 8 February 2012, when the warrant was executed, as we have heard about today. However, predominantly this behaviour took place from about April 2011 onwards, into 2012, when Mr Boyton was between the ages of 19 and 20.
4While it began somewhat naïvely, insofar as the first two charges are concerned, in that sense I mean that criminal activity was undertaken by Mr Boyton, in circumstances where he could be easily traced. Indeed he was interviewed subsequent to such crimes. The criminality developed into a sustained attack on the financial system of this community and the process of online financial dealing. It involved subterfuge and steps undertaken, given his knowledge of computers, whereby he was at pains to ensure that his identity was not able to be detected.
5Insofar as this plea is concerned, the facts as set out in Exhibit A, being the summary prosecution opening on plea, dated 7 August 2015 was accepted by Mr Tiwana as representing the facts upon which his client was to be sentenced in this matter.
6Those facts are extensive and cannot be properly summarised by me.
However, for the purpose of this sentence, the summary of prosecution opening, Exhibit A, will be annexed to the sentence, so that a full exposition of the prisoner’s criminality is provided in the sentence.
7As I say, the reason for this, is in order to understand the extensive nature of this criminality and the details of it. I do intend for the purpose of this sentence today, to provide a summary of such criminality as best I can. As I say, it will not fully summarise all the facts, but for the purposes of this hearing, does provide a précis.
8The charges involved essentially 34 online frauds amounting to charges of deception, or attempted deception and associated with that, various utilisations of identification information to allow the deceptions to take place. As I said, it was a sustained and intensive period of criminality, where Mr Boyton used aliases, false company names and associates, email addresses and false email addresses to defraud financial institutions, charities, businesses and individuals. The offending was his alone, and it would appear at times in concert with unknown co-offenders.
9This criminality is particularly complex, and involved 14 separate investigations in the police investigation, which they dubbed Operation OVERDRY. In that regard, it is appropriate to read paragraphs 3 and 4 of the opening.
"On 22 March 2011, investigators attached to the Victorian E-Crimes Squad commenced Operation OVERDRY. Operation OVERDRY was an investigation into a large number of complex online frauds committed by the accused between 2009 and 2012. Due to its complexity, Operation OVERDRY involved 14 separate investigations".
10Paragraph 4:
"The general criminal modus operandi of the accused, was to use various personal aliases, false company names and associate email addresses, to defraud financial institutions, charities, businesses and individuals, as I said, both alone and in concert. The accused used his skills and knowledge of computer programs and the internet, to be able to effect these crimes".
11The evidence given today, perhaps gives further perspective to these crimes.
Detective Senior Constable Green, who is a member of, I assume what must be one of the most modern squads in the police force, the E-Crime Squad, confirmed what I have already said, that this was a particularly large investigation involving 14 separate investigations, and the whole eight detectives, who make up the E-Crime Squad. Detective Green was the lead investigator.
12The process involved in this investigation, involved digital and forensic analysis and as indicated this morning, such analysis was difficult because there were some nine million data files which had to be perused. It took a considerable period of time and involved an analysis of some two to four laptops, an iPhone, a professional computer tower and various dongles.
13There were 660 exhibits to this brief. Detective Green was unable to estimate the man hours that went into this investigation, but thought that they were in the hundreds. He described this investigation as involving one of the largest cybercrimes that has been investigated by this particular squad, which was made particularly difficult by not only what the defendant originally asserted as to his innocence, but also by the number of parties who had to be interviewed predominantly interstate, but also international, to rebut those protestations. When first approached, Mr Boyton said in his record of interview, that other parties had simply logged the site, of which he was a member and committed these offences. The brief involved 100 witness statements and the final brief delivered, involved some 400 pages of material.
14I refer to that evidence because my own understanding and comprehension, as I perceive from the papers, is as I have said, that the culpability here involved a very complex series of crimes.
15Coming then to the specifics, Charges 1 and 2 involved the use of a fake business known as "HCBIA". This was a website to sell cheap Qantas flights. It was effected by using false passports and the site offered 50 per cent off the
recommended retail price. One would have thought in the circumstances, given of the cost of flying, that anyone reading an advertisement offering such a price would be careful about. The advertisements were made on the Gumtree site, offering cheap Qantas flights. There were 44 such advertisements, which are detailed in Exhibit B.
16Charge 1 is of attempt to obtain financial advantage, and the second charge, is obtaining financial advantage by deception, and that related to only one of these persons, a Mr Krupnikov. This offending was somewhat naive because Mr Krupnikov was able to approach Mr Boyton, and a refund was made to him, when he complained to Mr Boyton. That refund was of the amount which makes up Charge 2 of obtaining financial advantage, a sum of $950. That matter was therefore solved by the refund.
17Charges 3 and 4 occurred in December of 2010. They occurred when Mr Boyton was 19. They involved the use of a fraudulent credit card to purchase a digital camera. When that fraud was discovered, again through a somewhat naive performance by Mr Boyton, police attended and interviewed Mr Boyton about how he came to purchase the camera. Indeed he gave a false story and signed a false witness statement.
18The total fraud involved in regard to Charge 3, is the cost of the camera being
$429, that is obtain property by deception, Charge 3. The perjury charge, Charge 4, relates to the witness statement of Mr Boyton, which became Exhibit C, and is an offence against s.112(1)(b) of the Criminal Procedure Act 2009.
19The next series of charges occurred in May of 2011, again when Mr Boyton was
19. This involved a series of multiple advertisements on eBay, purporting to be a genuine seller of electrical and white goods. Mr Boyton would advertise for sale, appliances he did not have, and would then purchase items such as dishwashers, fridges et cetera, with stolen credit cards.
20The victims or persons who won the eBay auctions all made successful bids.
The credit cards with which he purchased the items would later be identified as fraudulent. The source of the credit cards was unknown. Insofar as the charges in this matter are concerned, the first is attempt to obtain financial advantage. There were no losses sustained in these charges and they relate to five separate dealings, and those are set out in Schedule A, attached to the Indictment.
21Charge 6 is a charge of obtain financial advantage by deception. It relates to Ms Staker and Exhibit D so far as Ms Staker's statement is concerned, is typical of this type of crime. There were three complainants associated with that matter and they are set out in Schedule B, that is Staker, Taylor and Otto who lost respectively $1,566, $1,276 and $869, Staker had in fact paid for the item, and suffered a loss of $1,566. There was a loss by the supplier, Appliances Online, in regard to the Taylor matter of $2,198 and Ms Otto, when she had to substitute for that item, in fact suffered a loss of $869.
22The next series of charges arose in the period August 2011 to September 2011, they make up Charge 10. In this instance, Mr Boyton sought eBay sellers who had aged eBay accounts and aged PayPal accounts, in order to list products. This was an attempt by him, to utilise third persons, with good eBay histories, to effect his frauds.
23He used the false business name of "Electronic Solutions Overstock". Sellers would list the item, but would not be supplied with the goods they were to sell. Again this charge relates to the sale of household items at cheap prices. The eBay user Stefanovski was the successful applicant in this matter. That is, the third party utilised by Mr Boyton to effect these deceptions. His job was to sell such products on behalf of Mr Boyton.
24However, the customers started complaining to eBay, that is to the eBay seller Stefanovski, after the products that they had purchased did not arrive. The total value of the fraud effected in this instance, as set out in Schedule E, was
$31,472.30. PayPal refunded most of the 28 victims. So in total, there was a loss of $20,878 suffered by the victims. Insofar as Mr Stefanovski is concerned, his ability to use the eBay was dramatically effected obviously, and he has sought a certification under s.89(f) of the Sentencing Act 1991.
25The next series of charge again involved a series of eBay transactions. They are Charges 11 through to 13. Charge 11 was firstly the payment for a job advertisement, or the failure to pay, by the use of a false credit card. In this instance, the sum involved was $99. The main fraudulent process was the job advertisements placed on eBay for eBay users to sell on behalf of Mr Boyton. Again, a false business name was used. Fifty-nine eBay sales were made and the scheme returned a total of $35,838.
26Insofar as Exhibit F is concerned, it demonstrates the typical messages that were exchanged between Boyton and in this instance, the person selling on his behalf, Jessica Waszczuk, a person who also was dramatically effected by such matters in the sense of her integrity on eBay was impacted, and she has also sought certification under s.89(f) of the Sentencing Act 1991.
27Insofar as those sums are concerned, PayPal refunded some of these to the victims. The total loss suffered by the remaining 18 victims came to a total of
$10,449. The last charge associated with these matters is the using the false name and address in relation to the advertisement. He used, in this instance, a false name of Mark Sanders. Indeed, that is the name that he dealt with Ms Waszczuk. Mr Mark Sanders allegedly had a Noosa address. In this instance, Charge 13, you used that name and false credit card to pay for the advertising as part of this program and that advertising figure was a sum of $2,500.
28We then come to a series of charges, again on eBay, which are made up with Charges 14 through to 17 and these occurred when Mr Boyton was 19 and occurred in September of 2011. The first concerned Charge 14 and that is the actual costs of the listing of the non-existing items on eBay, the seller fees which
remained unpaid and were fraudulently obtained was the figure of $1,500. Charge 15 related to the person hired to sell items on behalf of Mr Boyton. That is, that person was never paid for the job they did. It was obvious it was never intended that that person be paid and there was a total sum of commission fees in that regard of $1,758.
29Insofar as Charge 16 was concerned, again this charge is one of obtain financial advantage by deception. The person involved in this case has also sought certification under s.89(f) of the Sentencing Act 1991, and that is Kristie Jaremus. This process which involved Charge 16, involved using - or eBay frauds and using a site called the "Career One" website to offer employment opportunities to persons and to offer goods by way of a company allegedly called "Electronics Solutions Overstock".
30The 34 people who purchased goods, pursuant to this scheme, are set out in Schedule G to the Indictment. The process involved advertising work from home eBay seller position, which Ms Jaremus took, it was passed off to such applicant as a legitimate business and as part of that business, 14 people paid
$13,535 to fake PayPal accounts, for non-existing goods. The money involved in that was repaid by Paypal to those 14 people.
31There is also an additional 20 persons who paid $15,933, not into PayPal accounts in this instance, but into fake bank accounts, again for non-existing goods and that money is money that makes up a portion of the amount lost as a result of the totality of these frauds.
32We then go to Charges 18 and 1,9 which is again another eBay scam, and again this occurs in September 2011. This involves firstly an attempt under Charge 19, to obtain financial advantage by deception and in this instance, the four customers are set out in Schedule J to the Indictment.
33Again, Mr Boyton advertised for the position of a eBay seller on behalf of a fake company. The eBay seller sold seven dryers and two TVs to nine customers.
Four of those customers became suspicious and never paid. The amount attempted to be fraudulently obtained from those four persons totalled $4,596.
34Insofar as the obtaining financial advantage by deception charge, Charge 18, the total was transferred from those who did pay, and not refunded by PayPal, was $999. That is, the amount left after PayPal had repaid the amounts. Again, that is set out in Schedule I to the Indictment.
35Insofar as perhaps undertaking a number of those activities, Charge 20 is relevant. Again, that took place in September 2011, and that involved the use by Mr Boyton of a stolen credit card to purchase a virtual office for a period of one month. Of course, that was a stolen credit card, and therefore it remained unpaid and hence the charge.
36We then come to Charges 21, 26, 31, 32 and 33. Essentially these relate to the use of identification information in one way or another. Charge 21 relates to the period December 2011 to the use of fake credit cards, being the use of identity information. Charge 26, again occurs in January of 2012. In that instance, the prisoner copied stolen credit card information into a credit card checking tool on a website. That tool checked if the credit cards worked.
37Charge 31, the supplying of such information occurred in January of 2012 and came about from the police observation of the accused on an online chat program, chatting with other users about committing credit card fraud. That was part of the investigation leading to the execution of the warrant, in the following month. Finally, when that warrant was executed, Charge 32 was laid, and that relates to the possession of such identity information.
38The charge itself relates to stolen personal financial information of nine individuals, but it also relates to possession of 160,000 fake credit cards. That in itself beggars description. Charge 33 also occurred in February of 2012 and that regards a charge of making identification information, in this instance, Charge 33 involved the image of a Commonwealth debit card belonging to the
accused, that he had doctored by the use of photo shop by changing the name on such credit card.
39We then come to Charges 22, 23, 24 and 25. All of these involved advising of cheap airline tickets again on Gumtree and Craigslist under a false business name. Such did not have the naivety of the earlier attempt, and in this instance, stolen credit cards were used to buy the tickets, once a person had committed and responded to the advertisement.
40Charge 22 involves a charge of obtaining financial advantage by deception and involves Mathieu Mozziconacci in the sum of $2,000. Charge 23 involves Brett Conlon and his wife in the sum of $1,400 and Charge 25 involved Nigel Hayday, in the sum of $3,600.
41Insofar as Charge 25 was concerned, that is the matter that involved the case of Exhibit I, which is the victim impact statement lodged today by Carmel Maouch. This particular circumstance was particularly reprehensible, and given the consequences for the person, this person was on, as she describes, the flight or the trip of their life and unfortunately, halfway through the trip, this fraud was detected and Qantas refused to honour any further flights.
42As is seems to me appropriately described, the social impact was the family tension and the problems that she suffered. The financial impact was the need to obtain money as she said, make arrangements to get home, to reach a compromise with Qantas and the travel insurance companies. At that stage, of course, she did not realise, to use her words: "That all of this had come about from the accused’s heinous fraud". She says that she still feels the impact of such fraud today.
43In regard to the physical impact, she quoted the emotional stress, the anxiety and depression that impacted upon her as a result of these circumstances.
44Unfortunately of course this would be unknown to the prisoner, as these crimes
were committed without knowing the victims and committed over the internet. But this particular person suffered from cerebral palsy and hence the physical and emotional stress were made worse. As she said in the record of interview:
"The fact that we're almost made destitute on our holiday, also impacted upon me physically".
45Finally, in regard to emotional impact. She says:
"I did suffer anxiety and distress as well as depression from this, as we found out about our tickets being cancelled two months into what she describes is a three month dream holiday, which was destroyed by the accused. The uncertainty of which took an emotional toll on me which I still feel today".
46Insofar as the victim impact statements are concerned, there is also one of Ms Jaremus and I have already described her circumstances as making up the deception in regard to Charges 14 to 17. Again, there is nothing, it seems to me, inappropriate in what she said. Here again she traded with this person that she knew as Mark Sanders. She said that she suffered as a result of her innocent part in this scheme. Threats from very aggressive and angry buyers who got her contact details and address through eBay. She said that she suffered from those threats, was called obscene names, which led to a situation of being frightened of her own safety. This of course came about from the fact that she had been placed covertly in this position, so as to protect the prisoner.
47Ms Jaremus was unable to sell anything further on her eBay account, as she was subsequently banned. She found she was in debt for thousands of dollars in fees "that were not mine as a result of this crime". She said:
"I previously used this account to sell items to make some cash to ease the financial burden we were under and this increased my stress. This entire crime and events has left me feeling scared and incredibly stressed, even over a year later. It effected my sleeping, eating and confidence. I lost a lot of weight and I could not find employment as I was too anxious".
48Now these are the only two victim impact statements tendered in this case, but they seemed to me representative of the impact on persons when these types of crimes are committed upon them. As I say, we had the earlier tendered
material of the discussion with Ms Staker.
49As I said, in regard to Ms Maouch, in regard to the obtaining financial by deception in that matter, was detected while on flight.
50We then come to Charges 27 and 28. They were committed in January of 2012.
Again, there was an advertisement on eBay for a seller to sell products for a fake company. Money was obtained fraudulently from buyers. In regard to Charge 27, a total sum of $1,448 was obtained. It was part of the obtaining financial advantage by deception and the recruitment was effected under the name of Scott Campbell.
51Charge 28 is the total number insofar as the products advertised. There was a total of $105,109 in products advertised. However, those adds were ultimately withdrawn following the intervention of the police and no money was lost by those crimes. Again, Scott Campbell, being another innocent victim in this matter seeks a certificate under s.89(f) of the Sentencing Act 1991 from the Court. If I have not announced it before, I sign the three certifications that have been sought.
52We then come to Charge 29, which is the use of identification information. This was also part of the modus operandi. Insofar as checking credit cards and stolen credit cards, what Mr Boyton would do was make very minor contributions to charities such as, in this instance, the Cancer Council of Australia. The totality of these numbers - cards checked only amounted to
$21.50, but he used these donations in various small sums, as a way of testing the validity of the cards and very much, that being part of the modus operandi.
53Then there is the charge of conspiracy to cheat and fraud. This is Charge 30, again this is dated January 2012. This involves the creation of the website for a fraudulent company, which purported to be a trader of new and used agricultural earthmoving equipment. There was a contact made by this company of potential buyers and sales offered and fortunately, the potential
traders in regard to this scheme were of such experience, that they comprehended that the person making the offers simply did not understand the industry and no one was trapped by such scheme.
54A concerning final count is Charge 34. This was the dealing of identity information with intent. In this particular offence, an analysis of the computer material identified a number of software programs which Mr Boyton had, which enabled him to infiltrate other computer systems and to infiltrate vulnerabilities into those systems. That as I say, involves a short summary of the offending in this matter.
55MS MORAN: Sorry, Your Honour, if I could just briefly interrupt. I think Your Honour said in relation to Charge 34 that it was dealing with identity information with intent. I think you may have misspoken and meant possession of data with intent?
56HIS HONOUR: Data with intent, sorry.
57MS MORAN: Sorry to interrupt.
58HIS HONOUR: Data with intent, yes. It is my great writing, that is why I use a computer. Data with intent.
59As I say, that is the best I can do in regard to summarising Mr Boyton's criminality. There were, as set out, 55 individual compensation orders sought. The total losses in this matter were somewhere in the region of $100,000, that is total for all of the schemes and apart from the sums refunded by PayPal or various organisations, that left a total figure which has been identified today of
$50,057. That figure as indicated by Mr Tiwana is to be paid and has been undertaken to be paid by bank cheque, payable to this Court and is to be paid after these proceedings when there will be a relevant compensation order, in which it is to be paid.
60A forfeiture order has been sought and a compensation order sought, which I
have signed. A forensic sample order has been sought. The identity crime certificates under s.89(f) of Sentencing Act 1991 have also been sought, which I have indicated I intend to sign. As the Crown also made clear, there was no criminal record of Mr Boyton and nor has there in such circumstances been any pre-sentence detention served.
61Insofar as the plea was concerned of Mr Tiwana, the first document tendered was the psychologist's report. That report is one of Pamela Matthews, forensic psychologist. It is dated 6 August 2015 and was Exhibit 1. Insofar as that report, it was to support essentially the background that Mr Tiwana put to this Court and he asked me to take this into account on the issue of moral culpability in this matter.
62It would appear that Mr Boyton has what is described as a shackled upbringing.
His parents were members of what is known as the Independent Baptist Church. They practiced social separation and this was very difficult in his upbringing.
63They moved from various parts of Australia, from Cairns to Perth and beyond.
His father was a pastor. Their life was very much marked by limited means. They moved from church to church. Finally, ultimately they moved to Perth when Mr Boyton was 12 years of age, and moved to Melbourne in 2008.
64Given such an upbringing, there was issues of connection for Mr Boyton, an issue with making friends. There were limited friendships, there was no TV, there was no cinema. There was a situation of home schooling. There was no pocket money. He had some hearing issues. He was a person who started and was skilled in woodwork and began that the period of 13 while in Perth, and was part of various online for church forums, where he made contact with his now wife.
65He was allowed to use that internet, and it was in that use of the internet as a very young boy that he started to explore the systems of making money. It was
put that he was desperate to break free of his family, that he wanted to gain financial independence. As I said, the majority of these offences took place when he was 19, and would appear that he was running a graphic design business at the same time.
66Allegedly, from the money he received from these crimes, he paid expenses for his parents, paid rent for his parents and indeed met certain bills. He has now, and since his marriage, broken away from his family and that particular part of the church. He indeed, in fact continued to live in his home till March of last year when his marriage took place.
67In support of that proposition was, as I said the report of Ms Matthews.
Essentially he gave such history to Ms Matthews. Ms Boyton confirmed to Ms Matthews her observations, the manner in which he was brought up. As I said, he was home schooled for a period of 12 years. Mr Boyton also detailed for Ms Matthews his acute hearing disorder Misophonia, which makes him sensitive to various sound pitches.
68Mr Boyton does not however have, as reported, any mental health issues. He considers himself mentally strong. He said he was not violent despite having been brought up by a person he describes, that is his mother, as both physically and verbally abusive.
69He, as I understand from his wife's evidence, attended counselling insofar as these crimes, with Ms Matthews, on nine occasions. Ms Matthews took the view, in regard to the wife, that she impressed as a quiet, but assertive and confident young woman. I must say, that I obtained the same view of her, from the very impressive evidence that she gave to the Court.
70In treatment, Ms Matthews focused on behaviour therapy, trying to establish the links between the feelings and behaviour and any distortions and challenges in his thinking. Insofar as her diagnosis and opinion, at p.8, she stated:
"Mr Boyton does not present with mental illness, personality disorder,
including any anti-social disorder or cognitive impairment. He has however, had a developmentally, very sheltered, socially isolated, restricted childhood, which lacks in life and worldly experience".
71Her view of the time of his criminality was based upon the information given:
"Adolescent difficulties and judgment and problem solving, combined with being dependent upon family support and still bound by family morals and expectations".
72It was her view that it was this very sheltered and secluded upbringing which had not provided him with skills to manage peer pressures or psychological stresses of the financial demands of supporting his parents and siblings, and the various temptations of the broader society. I think that those various temptations of the broader society are more what Mr Boyton was interested in.
73There was apparently periods of stress for Mr Boyton, leading up to these crimes, and of course, there has been particular stress since that time. However, insofar as the last three years is concerned, Ms Matthew opined that he had positively engaged in treatment and has surrounded himself with sensible supports and advisors. It was the opinion of Ms Matthews that over the last three years, his adjustment has been highly positive and is a good prognostic indicator for a low risk of reoffending and a bright future. Ms Matthews was concerned, given those circumstances, if he was given any lengthy time in an adult criminal environment.
74The issue as to moral culpability was taken up by Mr Tiwana. There is no doubt that initially he was young and very immature and as I said, in the initial charges, he indeed gave his personal bank account information initially and that is how he was able to be traced.
75Indeed, in regard to the purchase of the camera, again his home address was given and again, perjury was effected when he denied it, albeit that it is submitted that that perjury is the bottom end of the perjury charge. I do not know whether I really accept that. Perjury it seems to me is perjury, but that is exactly what the provision is designed to stop.
76It was suggested that that naivety may well have continued right through to the charge involving the farming machinery, I find the naivety had well vanished, insofar as these crimes undertaken by Mr Boyton.
77As I said, his wife was called to give evidence. As I also said, she was a very impressive witness. She confirmed the issues in regard to his upbringing. She confirmed, I am not too certain if she personally observed, but certainly that her husband had said that he was subject to physical punishment by his mother.
78She was not aware of these issues and had a very emotional reaction to those when her then boyfriend was arrested. They started to go out in 2009 when she was 17, he was 19. They were restricted because of the arrangements made through the church, and indeed as I understood it, his parents were not happy with the relationship.
79She now, subsequent to marrying him, works with him in Smart Australia Proprietary Limited, which is a "finding service for a solar panel company" for which they get $30 per customer. Prior to this time, she confirmed that not only was he a hard worker, and is now a hard worker, but has been conducting that business for two years and prior to that time, worked in workplace training and marketing, and in particular, did marketing for the organisation known as Jim's Mowing.
80She said that in her view, her husband was truly remorseful and he had as part of that remorse been donating to charities and she confirmed that it was intended to repay the sum outstanding, which I understand will be done today. Such was at some personal consequence, because her evidence was that they sold their cars in order to make up this money.
81In cross-examination, essentially she described the current employment as a virtual office with a 1300 hotline. She confirmed the counselling with Ms Matthews occurred on nine occasions and she confirmed the ownership of a solar company in Western Australia.
82Insofar as the submission was concerned, as I indicated, Mr Tiwana tendered and we marked as Exhibit 3 the submission and outline of submissions made on behalf of Mr Boyton. He stressed that the Court is now dealing with a youthful offender. Even at this time, he is still relatively young.
83As I have already remarked, most of the offences occurred when he was 19 and early 20. Mr Tiwana stressed importantly in this matter, that there are no priors. Importantly also, the steps taken by him to rehabilitate himself, that in the period of three and a half years, which has passed. That delay cannot be taken into account, as an issue which leads to a discount of sentence, because that delay has been brought about very much, as a result of the very criminal undertaking of which he was very part of and its complexity, which has been described by Mr Green today.
84However, the manner in which Mr Tiwana relied upon the last three and a half years, was the effecting of rehabilitation, perhaps highlighted now by the payment of the loss sum of $50,057. Mr Tiwana did not in any way seek to suggest that we are not dealing with serious crimes. The maximum penalties prescribed clearly indicate that.
85Nor did Mr Tiwana seek to put to the Court that principles of deterrence, general deterrence, specific deterrence, punishment and denunciation were not very important here. There is no doubt that this offending was persistent and predatory. However, again, insofar as the rehabilitation aspect, Mr Tiwana stressed that there has been no further offences committed since that time and no suggestion by the Crown, of any such behaviour.
86As I say, Mr Tiwana relied upon the positive comments of Ms Matthews, that I have already read out, and submitted that it was in the community interest to give, despite the seriousness of these crimes, Mr Boyton a chance. That I could be confident, with the excellent and also impressive bundle of character references, which I have again read, from his family, in particular of his wife's
family, and the minister who are very supportive and again, they are impressive. It was submitted I could be satisfied that Ms Matthews' opinion that Mr Boyton will effect rehabilitation, with the support of his wife and family, and I should give him that chance.
87Essentially the submission was based upon Boulton v R [2014] VSCA 342 ‘Boulton’, which was detailed in Paragraph 10 of the written submission, was that I was invited to impose a Community Corrections Order without any period of imprisonment. In support of such application, today was tendered the Community Corrections report, which I had ordered, which was also positive.
88Also, since the hearing, Mr Tiwana has notified the Court and confirmed today and there is no dispute about this from the prosecution, when Mr Tiwana indicates that these offences, given their timing, are also offences that could be subject to the imposition of a suspended sentence.
89The Crown in response to such a submission, submitted that this was a case which required immediate imprisonment because of - notwithstanding the youth of the offender, the youthful time that these matters took place and his background, this conduct was brazen and deceitful. To use her words:
"His fraudulent actions were gobsmacking".
90She submitted, as I said, immediate imprisonment was the appropriate penalty that this Court should pass. As I have indicated, sentencing in cases such as this is particularly difficult. In favour of Mr Boyton is that he is still only 23. The behaviour is the behaviour of a person who obviously was young and immature, no doubt immature from the manner in which he had been brought up.
91However, what should have been obvious to him, in particular from his own upbringing, is the concept of personal honesty. He has had in some ways a socially deprived life. He may have in fact got some physical beatings from his mother, but he has no mental, intellectual, or cognitive difficulty. He knew right from wrong, and no doubt, was taught that from a very early age.
92However, the Court always understands that people can make mistakes. We know that three and a half years have elapsed since. There is no evidence of him committing any further crimes. Such delay has occurred, and has to be taken into account, not on the basis of any fault from the prosecution, but on the basis that during that time, Mr Boyton has been able to re-establish himself in the company Smart Australia Proprietary Limited and in the earlier enterprises that I have earlier spoken about, and has taken steps to rehabilitate himself.
93In the last two years, he has traded essentially as an energy smart website and in particular, I note in Exhibit 2, the reference from Mr Jenkins about his activities. Also, he has undergone the counselling which I have referred to insofar as the report is concerned. He married in March of last year. His wife, who I have said, gave very impressive evidence for him, whose confirmed the counselling undertaken with Ms Matthews.
94In particular, he has no priors and not only is his plea of guilty indicative of a utilitarian benefit to the community, given the complexity of this case, although that has to be put in perspective. It is important to make the point that having totally denied any wrongdoing, the police force, in particular the E-Crime Squad, as indicated, was required to undertake one of its most arduous investigations it had ever undertaken in order to get to a position of lodging a police brief.
95However, I accept that he is now remorseful and I accept the support he has from his wife, family and from the supporters as demonstrated in the letters tendered. I also take into account the principles set out firstly in DPP v Tokava [2006] VSCA 156 ‘Tokava’, by the President in discussing these matters of rehabilitation.
96In Tokava in particular [21] on p.5. The President said this:
"A Sentencing Judge should be astute to investigate whether a non- custodial disposition is to be preferred, even in a case of a serious offence, if in the long term the community's interest would be best served by that course".
97I fully understand that principle and have utilised it on many many occasions.
In addition to that, is the case relied upon by Mr Tiwana of R v Merritt, Piggott
& Ferrari [2007] VSCA 1 and again, it involved in that case an inordinate delay with powerful mitigatory factors of rehabilitation, again involving relatively young persons.
98The Learned President said at Paragraph 49 of that judgment, the following:
"The sentencing Court looks to the future as well as to the past. There is a very great benefit to the community at large as well as to individuals themselves and to their immediate families. If future criminal activity can be avoided, it is important that the Court, by its own sentencing decisions, recognise and reward efforts at rehabilitation. Just as we, that is the Court of Appeal, should support Trial Judges who do so.
It is important to reinforce in the public mind that the very considerable public interest in the rehabilitation of offenders, the pre-occupation of the retribution which characterises much of the public comment on sentencing is understandable. But it focuses on only one part of what the sentencing Court does".
99Again I should say, I have utilised that principle on many occasions. I also note that Exhibit H, is a positive report, so far as the Community Corrections Order. The alternative of a suspended sentence was put to the Court.
100Against those factors, this Court has to take into account the seriousness of this conduct. As I say, whatever his background, he knew right from wrong, suffers no intellectual problem or difficulty of cognition. It is quite clear in my view that albeit, money had to be - until he left the home, utilised to support his parents, that he wanted to remove himself from the economic distress, in which he had been brought up, and figured out, a determined scheme to do so.
101Ultimately, this became a very calculated and meticulously planned endeavour.
It took place over a substantial period and in particular, over a concentrated period in the years 2011 through to the start of 2012. In that time, he obtained sums by way of money or items purchased, or utilisation of person's credit funds in the sum of $100,000.
102But for $50,057, those sums were totally lost, not to the individuals, because
they were repaid by PayPal. However, there was a sum loss of $50,057, which I note will be paid this day. Clearly, by the very pleas, he has attempted on many occasions to obtain far more than he actually did. His role cannot be underscored. His is the principal role in this serious offending.
103In taking into account this type of behaviour, I want to refer to R v Zarrinkafsh [2005] VSCA 22 and, I want to refer to [24] through to [33], but in particular, Paragraph 27. Vincent JA, as he then was, said this, and this was in many ways similar to the type of behaviour I am dealing with in this case.
"Unfortunately, the type of conduct which the appellant engaged in is being encountered with increasing frequency in the Courts. With the adoption of a variety of sometimes sophisticated techniques to manipulate the systems of banking and credit, in this instance, internet use of credit cards, upon which the community depends in order to conduct its ordinary affairs. This type of crime is by its nature difficult to investigate as the perpetrators seek to maintain anonymity".
104As I have already indicated, the investigation and the steps by way of anonymity could not have been any greater in Mr Boyton’s case.
"The cost to the general community arising from the commission of such offences and the various systems which have been put in place, in order to guard against them, in an attempt to reduce their incidence are obviously of importance".
105His Honour went onto say this at Paragraph 28:
"Considered against that background, it is apparent that general deterrence has an important part to play as a sentencing consideration, where perpetrators do appear before the Courts".
106In talking about the case that he was dealing with, he said:
"In the present case, in view of the number of distinct unlawful acts performed by the appellant, the length of the period of offending".
107In that case, there was also subsequent criminal history.
"Significance also has to be attributed to specific deterrence".
108I also refer, although the sums involved are totally beyond what is involved in this case, to DPP v Bulfin (1998) 4 VR 114 ‘Bulfin’ as to white collar crime. This was a determination of the Court of Criminal Appeal. The principles in this case
have recently been upheld, post Boulton, by the Court of Appeal. The Court of Criminal Appeal as it then was, comprised Winneke, P, Charles and Callaway, JJA. I quote from Callaway's determination. This determination being made on 17 April 1998, I stress again there is no similarity of sums involved in this case. There is similarity in what I am about to read out.
109I am reading from p.13:
"In the case of white collared crime, the lives of offenders and their families will frequently have been devastated by the consequences to the discovery and punishment. It would be difficult not to feel great sympathy for the respondent's wife and family, but I think there is a serious risk, the consequences of discovery and punishment and the havoc that a custodial sentence usually reeks in the lives of the white collared criminal and his or her family, may have a tendency to distract attention from the importance that general deterrence ought to carry an imposition of sentences for crimes such as the present.
110The motivation to engage in conduct of the kind here under consideration may spring from many sources, and I have referred to the particular means. His Honour goes onto say:
"Whatever the motivation, offences of this kind in question must invariably involve, carefully calculated course of conduct over a long period. Repeated deliberate acts of dishonesty, substantial amounts of money and frequently losses to large numbers".
111Now obviously, as I said, that case involved much larger amounts of money and much larger losses. I refer to it only for the general principles. I also want to refer to R v Tsiamas & Kastanis (unreported, VSCA, No.25/26 of 1997, 21 May 1997) ‘Tsiamas’. Again, I refer to this matter by way of analogy. This was again a determination by a Court of Criminal Appeal as it then was, 21 May 1997, comprising the then Appeal Justices Callaway and Batt. This related to two young, first offenders.
112The prisoners had been placed in Youth Training Centre Detention, as a result of what is described as an orgy of destruction. In that instance, they got into a storage area at a council depot, using a machine, they smashed through a number of machines and equipment making up some $75,000 in damages and
loss wages for the council.
113The issue was whether they should have been given gaol, or whether such should have been in Youth Detention. The Chief Justice said at [6] insofar as the sentence:
"The Judge was not unmindful of the seriousness of imposing custodial sentences upon first offenders. But he found, as he said to them, the scale persistency and ferocity of your behaviour, put yourself beyond the path. In my judgment, the only appropriate sentence is imprisonment.
114He further said at and quoted from a determination of the Queensland Court of Appeal at p.7, that being the case of R v Bainbridge, Cullen & Ludwicki (1994) 74 A.Crim.R 265.
"There are of course some cases which are so serious that notwithstanding youth and the absence of relevant prior convictions, the offender must go to gaol".
115Callaway J spoke about the importance of rehabilitation. I will not go over those principles again. But at p.9 he said this?
"The primary submission advanced by counsel for each of the applicants was that an immediate custodial sentence was clearly inappropriate. I do not accept that submission. It is not so much the value of the property that was damaged, although that was important, but the nature of the conduct itself".
116Batt JA said at p.10:
"General deterrence and denunciation of these offences are in my view in this case of importance and should be given effect by a sentence of confinement".
117The real issue in that case was the degree of confinement, where it should be, that is, between adult and youth. Now I am not unmindful in Mr Boyton’s case that these offences occurred and up to I think Mr Tiwana, the age is 21 is it not? Had I been sentencing your client as a young offender, up to the age of 21, I could have in fact sentenced him to a youth training facility and I am not unmindful of that position.
118MR TIWANA: Yes, Your Honour.
119HIS HONOUR: I am also not unmindful of the provisions set out in s.5, nor the provisions set out in s.5(4)(c) of the Sentencing Act 1991, particularly insofar as they relate to Community Correction Orders. The case of Boulton has been specifically put to me, and the principles set out in the written submission and those paragraphs as detailed in that submission.
120It is necessary as I said, to effect a very difficult balance in these circumstances.
Mr Boyton, unfortunately for you, my consideration of all the facts and authorities leave me to conclude that the only sentence appropriate in regard to your criminality is one of immediate imprisonment. I say that despite the strong factors that I have referred to and identified, which have been put to me by Mr Tiwana. It is necessary in regard to the totality of your offending, and its severity, to pronounce a sentence which denounces such offending and effects the principles of both general deterrence, punishment, and in your case, specific deterrence.
121The grave nature of this offending, its degree, the length of time over which it took place, its sophistication and the steps taken by you to hide your role in it, are such that in my view, it is not appropriate to impose a Community Corrections Order, or a suspended sentence. I come to such conclusion doing as best I can, and being as merciful to you, understanding that this is a first time that you come before a Court. Would you please stand.
122Insofar as Charge 1 is concerned, that is attempt to obtaining a financial by deception, you will be sentence to a period of imprisonment of one and a half years. Insofar as Charge 2, a charge of obtaining financial advantage by deception, you will be sentenced to a period of imprisonment of one year.
123Insofar as Charge 3 is concerned, that is obtaining property by deception, you will be sentenced to a period of imprisonment of four months. Insofar as Charge 4, the perjury charge, you will be sentenced to a period of imprisonment of nine months.
124Insofar as Charge 5 is concerned, that is the attempt of obtaining financial advantage by deception, you will be sentenced to a period of imprisonment of nine months. In regard to Charge 6, that is the obtaining a financial advantage by deception, you will be sentenced to a period of imprisonment of 18 months. In regard to Charge 7, that is obtaining financial property by deception, you will be sentenced to a period of imprisonment of 18 months.
125In regard to Charge 8, that is the obtaining property by deception, you will be sentenced to a period of imprisonment of 18 months. In regard to Charge 9, the attempt of obtaining a property by deception, you will be sentenced to a period of imprisonment of nine months.
126In regard to Charge 10, the obtaining of financial advantage by deception, you will be sentenced to a period of imprisonment of two and a half years. In regard to the attempt to Charge 11, the attempt at obtaining financial advantage by deception, a period of imprisonment of six months and in regard to Charge 12, the obtaining financial advantage by deception, a period of two and a half years.
127In regard to Charge 13, the obtaining financial advantage by deception, 18 months. In regard to Charge 14, obtaining financial advantage by deception, a period of 18 months. In regard to Charge 15, obtaining financial advantage by deception, a period of 18 months.
128Coming then to Charge 16, obtaining financial advantage by deception, a period of two and a half years. In regard to Charge 17, attempt to obtain a financial advantage by deception, nine months. In regard to Charge 18, obtaining financial advantage by deception, 18 months. In regard to Charge 19, attempt at obtaining financial advantage by deception nine months.
129In regard to Charge 20, obtaining financial advantage by deception, six months.
In regard to Charge 21, that is use identification information contrary to s.192B, I impose a period of imprisonment of nine months. In regard to Charge 22, obtaining financial advantage by deception, a period of imprisonment of 18
months.
130In regard to Charge 23, obtain financial advantage by deception, 18 months. In regard to Charge 24, obtain financial advantage by deception, a period of imprisonment of 18 months. In regard to Charge 25, obtain financial advantage by deception, a period of imprisonment of two years.
131In regard to Charge 26, that is use identification information contrary to s.192B(1) of the Crimes Act 1958, a period of imprisonment of nine months. In regard to the obtain financial advantage by deception, Charge 27, a period of imprisonment of 18 months. In regard to Charge 28, the attempting obtaining a financial deception, a period of two years, imprisonment.
132In regard to Charge 29, that is use identification information contrary to s.192B(1), a period of imprisonment of six months. In regard to Charge 30, that is a conspiracy to cheat and defraud charge, a period of imprisonment of six months. In regard to the supply of identification information contrary to s.192B(2)(1), Charge 31, a period of imprisonment of nine months.
133In regard to the Charge 32, possession of identification information, a period of imprisonment of 15 months. In regard to Charge 33, that is making identification information, a period of imprisonment of nine months and in regard to the last charge, Charge 34, that is possess possession of data with intent, a period of imprisonment of 15 months.
134Using the sentence in regard to Charge 12 as the base, that is the period of two and a half years, I order that six months of the sentence in regard to Charge 10 and 16 and three months of each of the sentences on Charges 4, 25, 28, 32 and 34, be served cumulatively with each other, and the base sentence, making a total aggregate sentence of four years and nine months.
135In determining the appropriate parole period for you Mr Boyton, all of the matters that I have taken into account in regard to the sentence in this matter,
must be taken into account. I am anxious to pass a period of imprisonment by way of minimum term, that helps to affect your rehabilitation.
136Having given the matter considerable consideration, I have determined to give you a period lesser than would be normal in these circumstances and you will be ordered to serve a minimum period before being eligible for parole of two and a half years. There is no pre-sentence detention to take into account. I want to make it clear to you under s.6AAA of the Sentencing Act 1991, I am required to make this declaration, that had you not pleaded guilty to these offences, I would have sentenced you to a period of imprisonment of six years and four months, with a minimum period of three and a half.
137So to make it clear, after all of that, the period of imprisonment imposed on you for the totality of this criminality is four years and nine months. The period that you must serve prior to being eligible for parole is a period of two and a half years.
138I have signed the forfeiture order. I have signed the compensation orders. The forensic orders I do sign. You will be required upon release from gaol to attend upon a police - I think that is what happens is it not?
139MS MORAN: Yes, Your Honour.
140HIS HONOUR: A police station and you will be given notices to that affect and you can be bought back to Court if you do not consent to that. I also, as indicated, signed the identity certification certificates. Now, any matters that I need to attend - you can take a seat for the moment, Mr Boyton.
141MR TIWANA: No, Your Honour. I think the - Your Honour indicated that the Crown submitted (indistinct) immediate custodial sentence. As I understand it, the submission was that a sentence of imprisonment in combination with a Community Corrections Order was open. That was the submission made - - -
142HIS HONOUR: Is that correct Madam Prosecutor?
143MS MORAN: That's right, Your Honour.
144HIS HONOUR: Yes, I apologise. My notes are some time since and there has been a lot of water under the bridge, but I have not got that on my notes of what your submission, so I will amend that accordingly.
145MS MORAN: Thank you, Your Honour.
146HIS HONOUR: That is, your submission was immediate imprisonment was necessary. Whether it is combined with a Community Corrections Order was a matter for the Court.
147MS MORAN: I think it was that it could be.
148HIS HONOUR: It could be.
149MS MORAN: Yes.
150HIS HONOUR: That is what I mean.
151MS MORAN: That's right.
152HIS HONOUR: Whether it was a matter for the Court.
153MS MORAN: Indeed.
154HIS HONOUR: Well I have clearly rejected that submission.
155MS MORAN: Yes, indeed.
156HIS HONOUR: Yes. Nothing else Mr Tiwana?
157MR TIWANA: No, Your Honour. I'll go through the figures just to make sure.
I'm sure they're accurate, but nothing else, Your Honour.
158HIS HONOUR: Well I'm not here to say they necessarily are.
159MR TIWANA: Yes.
160HIS HONOUR: I'm always thankful of checking.
161MR TIWANA: Yes.
162HIS HONOUR: I want to thank both counsel for their assistance in this matter and I want to thank the family of Mr Boyton for their assistance. It is not a joy for this Court to send someone as young as Mr Boyton to gaol, and I am sure and hope that his rehabilitation will be effected after he serves his punishment, which is required by this community.
163MS MORAN: As Your Honour pleases.
164HIS HONOUR: Yes, well I wish you good luck Mr Boyton. You obviously have got the talent to use it far better than you did in these circumstances. Yes, take the prisoner away please.
165MS MORAN: Your Honour, might I be excused to Judge Carmody's Court?
166HIS HONOUR: Yes.
167MS MORAN: Thank you so much.
168HIS HONOUR: Yes, no doubt he's looking forward to seeing you.
169MS MORAN: Thank you.
170HIS HONOUR: Yes.
- - -
IN THE COUNTY COURT OF VICTORIA AT MELBOURNE
CRIMINAL JURISDICTION
Court Ref : CR-15-01143
THE QUEEN
v
RACHED EL SAYEGH
Prosecution Opening Upon Plea
Date of document : Filed on behalf of: Prepared by:
Mario Camilleri
10 September 2015 CommonwealthDPP
PO Box 21A Melbourne 3001 DX446
Office of the Commonwealth DPP Level16, 460 Lonsdale Street Melbourne Vic 3000
Telephone : Fax: Reference:
(03) 9605 4333
(03) 9670 4295
MC09100745/MPC
The Charges
1. Rached El Sayegh ("the offender") is 34 years of age. He is charged with 3 offences of dishonestly obtain a financial advantage contrary to subsection 134.2(1) of the Criminal Code (Cth):
• between 15 October 2005 and 13 August 2007 by deception dishonestly obtain a financial advantage of $50,133 .22, from the Commonwealth;
• between 7 July 2006 and 17 August 2007 by deception dishonestly obtain a financial
advantage of $96,132.44,from the Commonwealth;
• between 2 July 2007 and 20 August 2007 by deception dishonestly obtain a financial advantage of $123516 .76 from the Commonwealth
The penalty for each charge is a maximum term of imprisonment of 10 years and or a penalty units of 600 ($66,000.00) .
Background
2. There are rules governing the registration and the charging of fees for the preparation of Income tax returns by Registered Tax Agents (RTAs) . From 1 March 2010 the Tax Practitioners Board ("the TPB") oversees and administers the registration of RTAs. To
Prosecution opening
become an RTA a person must qualify under the Tax Agents Services Act 2009. Previously, the registration of RTAs was administered by the Australian Taxation Office (ATO) via the Tax Agents Board (TAB) under Part VIlA of the Income Tax Assessment Act 1936 (as amended) and Part 9 of the Income Tax Regulations. The requirements and administration of RTAs under the TPB are in substance the same standa rds that applied when previously administered by the TAB.
3. Persons who are not RTAs are prohibited from charging a fee for providing a service as an RTA including the preparation of income tax returns under subsection 50-5 of the Tax Agents Services Act 2009. Prior to 1 March 2010, the charging of a fee for the preparation of income tax returns was also prohibited under subsection 251l{1} of the Income Tax Assessment Act 1936 (as amended}. The penalty for the breach of that provision was a maximum fine of 200 penalty units ($22,000 in 2009}. The offender was at all relevant time not a RTA.1
Overview of the Offending
4. Between 15 October 2005 and 26 July 2007 the offender prepared and lodged 42 Income Tax Returns (ITRs) on behalf of 27 taxpayers in which he had inserted false expenses/deductions and or rebates in order to generate a large tax refund to the taxpayer. In some ITRS a consequence of the false deduction and or false rebates inserted by the offender was that an income tax liability that would have otherwise accrued on the ITR without the false deductions and or rebates was avoided unbeknown to the individual taxpayer. In all ITRS the taxpayers obtaining a tax refund which should not have been paid. The offender obtained clients for whom he prepared and lodged ITRs in several ways. Some clients had shopped at a grocery/milk-bar business situated at 10 Hall Street Newport where they met the offender . The offender introduced himself to them as an accountant and offered to prepare their income tax return.2 The offender promoted his business of doing
income tax returns.3 The milk-bar business was registered to El Sayegh & Sons Pty ltd from 5 October 2004 and the offender's brother named Ahmed El Sayegh was the sole director and shareholder of the company .4
1 Statement of the material facts vol 1pl
2 Statement of Tapeta Keenan vol 4 p1258 and Pa nkaj Amba voll pl3
3 Statement of Pau l R osado volume 4 p . l 504
4 Extra ct from Mascot Databa se p1245-1246
5. Other taxpayers had learnt of the offender's tax return business by word of mouth from friends or their fellow employees . The taxpayers believed that the offender was a "proper tax agent" and he could "do a good tax return and...get back lot more..."5 The offender promoted himself to his clients as capable of obtaining for them larger tax refunds.6 He assured one client, Genoeffa Digiacomo, a graphic designer, who questioned the refund of
$14,000.00 estimated by the offender that he had "...done commercial consulting work and personal tax returns..." and that "...everything was legal" and that he had done "...extra research on what he can claim..." for Miss Digiacomo. 7 To taxpayer Darren Gadsden, a supervisor, the offender stated that "he was an accountant and that he knows all of the loopholes that the common taxman or accountants don't know about..."and "that he had connections with the Australian Taxation Office." 8
6. Other clients learnt about the tax return services offered by the offender from an advertisement in a newspaper saying that the offender who they knew as "Richard" "did income tax returns after hours in the Keilor Downs area" .9 The offender consulted with his clients in several locations- at the milk-bar business which he explained to his client as a temporary shifting of premises,10 at 74 Tarella Drive Keilor Downs where the offender
tenanted between 9 July 2005 and 19 February 2007' 1• At 74 Tarella Drive Keilor Downs the
offender had a home office with a work-desk, telephone, laptop and fax machine and certificates displayed on the wall.12 Between about 2 February 2007 until about 25 July 2007 the offender also prepared ITRs for taxpayers at 20 Copernicus Way Keilor Downs where he was a tenant. 13
7. When the offender prepared the tax returns for the clients named in the schedules to the indictment he would obtain from his client an employer group certificate, the previous tax year Notice of Assessment (NOA) and bank account details. He would request details from the taxpayer of expenses to be claimed. 14 Sometimes the taxpaye rs produced receipts for expenses and he would view them.
5 Anthony John Falletti vol 1p160; Peter Nastasi vol 4 p1421; Francis James Fisher vol 1p190; Paul Rosado vol 4 p1499.
6 Statement of Kylie Muscat p.3403
7 Genoeffa Digiacomo vol1p135.
8 Darren Gadsden voll p204
9 Francis Maher vol 4 p1305;Brian Maher vol4 p1280
10 Shaun Anthony Appleyard p28.
11 Statement of material facts p2. REIV condition repo rt p1227
12 Chr is Bosevsk vol 1 p68
13 Statement of material facts vol1p.2
14 Digiacomo vol 1pl34
Charge 1
8. Between 15 October 2005 and 22 June 2007 the offender completed and lodged 10 ITRs for the tax year 2005 for 10 taxpayers . The offender inserted false deductions aggregating to
$85,882.00 and/or false rebates aggregating to $26,245.00 in the ITRs.15 The false
deductions included "work-related expenses", "work-re lated travel expenses", "work related uniform expenses", "work- related self-education expenses" , "other work- related expenses" and "gifts or donations". The false rebates included purported "spouse rebate" and "medica l expenses rebate" .16 Whilst the taxpaye rs generally did instruct the offender to claim some small items of work related expenses in their ITRs none of the taxpayers had authorized either the large false deductions and or rebates inserted in the ITRs by the offender. The 2005 ITRs were all lodged electronically apart from the ITR for Kate McMaster which was lodged in paper form .
9. As a result of the ITRs that the offender lodged in relation to charge 1the ATO assessed and paid out tax refunds amounting to $58,995.40. In relation to the income tax return of Tapeta Keenan named in Schedule 1the loss to the ATO is the aggregate of the tax refund paid on his ITR assessment and the proper income tax liability of $1,749.51 payable by that taxpayer on that particular ITR but for the false deductions and false rebates . In calculating the loss to the ATO arising out of the false deductions and/o r rebates in this charge and also in charges 2 and 3 the ATO has not taken into account any work related expenses/deductions/rebates that the taxpayers may have been entitled to claim in their income tax returns. The total fraud amount in charge 1is $50,133.22.
10. In relation to charge 1the ATO income tax refunds for the taxpayers David Barrios, Kate McMaster and Francis Maher were paid into the bank account of those taxpayers. The ATO paid the respective tax refunds for the remaining 7 taxpayers named in Schedule 1to the indictment into a Westpac account BSB 733092 No. 507041 held in the names Rached El Sayegh, the offender, and Mrs. Raifa Ahmad El Assaad, the spouse of the offender. 17 The taxpayer Ana Barrios had not authorized the offender to receive her income tax refund in his bank account. In regard to the taxpayers Moemin Hussein, Anthony Falleti, Tapeta Keenan
and Brian Maher the offender had not told them that their refund would be paid into his
15 Schedule 1to the indictment.
16 Vol4 p.l 247- 1 248.
17 Statement of Boris Ja kovac Vol 2 pp294, 346-363,336 and vol 4 p1257
bank account . The taxpayer Robin Tannous was advised by the offender that the tax preparation fee of the latter would be deducted from the tax refund. The offender had advised Belal Masry that the latter would receive a cheque for his refund. In respect of charge 1the total amount of income tax refunds that the ATO paid into the bank account of the offender was $45,870.24. The offender retained $34,437 .24 from that amount for himself and he paid $11,433 .00 to the respective taxpayers. The individual amounts that the offender retained and the amount that he paid to the taxpayer are listed in the attached "Annex ure A".
11. In respect of charge 1Mr. David Barrios, the son of the taxpayer Anna Barrios, ascertained from the ATO on 9 December 2005 that the income tax refund for Anna Barrios had been paid into the bank account of the offender . On 17 May 2006 the ATO issued a replacement cheque to Anna Barrios of $9,244.00. 1s The ATO debited the same amount to the tax file of the offender. The taxpayer Tapeta Keenan did not receive any part of the 2005 tax refund that arose from the lodging of his false ITR by the offender . Mr. Keenan spoke to the offender about this and the offender advised him that the ATO had mistakenly paid only
00.60 cents to Mr. Keenan's bank account and "not to worry "because the offender would "fix it next year". Mr. Keenan presumed that the offender would rectify the problem with the following tax year's retum19 In the following year Mr. Keenan received a refund on his 2006 ITR of $10,298.97 of which $8,669 .64 was not payable.
Charge 2
12. Between 7 July 2006 and 22 June 2007 the offender completed and lodged 15 ITRs for the tax year 2006 for 15 taxpayers. The offender inserted false deductions aggregating to
$143,339.00 and/or false rebates aggregating to $54,835.00 in the ITRs. The ITRs variously contained false deductions for "work related car expenses" and/or for "work related travel ex penses" and/or "other work related expense s". The false rebates were for "spouse and or parent, spouse's parent or invalid relative". None of the taxpayers authorized or approved the claiming of false deduct ions and or false rebates in the ITRs. The ITRs were all lodged
electronically apart from the ITR for Kate McMaster which was lodged in paper form .20 The
deceptions caused the ATO to issue greater refunds to the taxpayers than they were entitled to. In respect of the ITRs of Michael Hapeta and Kadime lsmaili the loss to the ATO included
18 Anna Barrios p.42
19 Tapeta Keenan vol4 pl259
2° Folder 2 p532 STAC capture
a liability for income tax otherwise payable by the taxpayer but for the deceptions. The total loss caused by the offender to the ATO in respect of the ITRs under charge 2 is an aggregate of $96,132.44.
Charge 3
13. Between 2 July 2007 and 26 July 2007 the offender completed and lodged ITRs for the tax
year 2007 for each of 17 taxpayers . The offender inserted false deductions aggregating to
$193,331.00 and/or false rebates aggregating to $60,144.00 in the ITRs. The ITRs variously contained false deductions for "work related car expenses" and/or for "work related travel expenses" and/or "other work related expenses" . The false rebates included claims for "spouse and or parent, spouse's parent or invalid relative". In the return of Kaneti Uluave, a construction supervisor, the offender inserted false deductions under 4 separate categories. In the income tax return of Paul Rosado the offender inserted for the first time in the course of his offending a false claim for "Australian Film Industry Incentive loss Deduction" of
$2,319.00.21 None of the taxpayers authorized or approved the claiming of false deductions
and or false rebates in the ITRs. The ITRs were all lodged electronically. The deceptions caused the ATO to issue refunds to the taxpayers greater than they were entit led to. In respect of 5 of these ITRs after the ATO has disallowed the false deductions and false rebate claims the taxpayer had a tax liability to the ATO. The ATO investigator has calculated the loss to the ATO under this charge as $123,516.76 .
Fees received by the offender for preparation of the ITRs
14. The offender charged a fee to his clients. Sometimes this was a flat fee which the client paid
in cash. The offender charged 7 taxpayers a 10% fee of the refund. The offender received
$21,130.00 in total fees from the taxpayers. That amount includes $560.00 that the offender deducted from tax refunds that he had obtained into his bank account for 7 of his clients. In respect of charge 1the offender had retained $34,437.24 for himself from the total amount of $45,870.24 in taxpayer refunds that had been paid into his Westpac account.
Detection of suspicious income tax returns and investigation
21 Boris Jakovac p1248. ITR p.l523.
15. In early July 2007 the ATO Intelligence Unit (IU) identified an Internet Protocol ("IP") address namely 58.107.207 .231 used to lodge 115 ITRs for year ended 30 June 2007.22 These ITRs were lodged via the ATO's electronic lodgement system known as e-tax. The ATO e-Tax is
an electronic tax preparation and lodgement software package. It allows taxpayers to prepare their current tax year individual tax return and to lodge the tax return electronically over the internet. The ISP and linked street address relating to the 115 ITRs were not known to be associated with a Registered Tax Agent (RTA). The ITRS recorded a pattern of unduly high Tax deductions and Tax offset (rebates) claims that resulted in highly inflated tax refunds.
16. ATO computers maintain logs of data generated in the electronic lodgement of ITRs.
Amongst other data these logs maintain the IP address, date and time of each transmission. Among the ITRs identified with this (58.107.207.231) IP address were the 30 June 2007 ITRs in the names of these taxpayers :
• Cory ALLISON
• Pankaj AMBA
• Anthony FALLETI
• Francis FISHER
• Kyle MUSCAT
• Pietro NASTASI
• Robbie NASTASI; and
• Paul ROSADO
17. ATO inquires identified that this IP address was serviced by Optus at the home of one Lorence Darmanin at 265 Taylors Road Kings Park. On 14 December 2007 Austral ian Federal Police (AFP} officers executed a search warrant at that address. The search established that the computer internet hardware at that location was unsecured and the computer hardware was not the so urce of the lodgement of the suspicious ITRs. It is alleged that the offender had used the unsecured Darmanin IP service without authority for the purpose of lodging fa lse ITRs.
22 Statement of Boris J akovac dated26 August 20 15 p2
18. The ATO further investigated the subscriber name to a mobile number 0432 410 436 that one of the taxpayers, whose ITR was in question, had provided to the ATO as his contact for the person who prepared his return.23 On 22 August 2007 Telco checks revealed that that number was subscribed to a Mrs. Hiam El Sayegh of 8 Nyandah Close Keilor Downs Victoria. Hiam El Sayegh is in fact the mother of the offender.24 From ATO records that address was also associated with Rached El Sayegh.
19. The ATO investigation subsequently also established that 10 charged 2006 ITRs had been lodged on the IP address 60.230.45.62. Some of the named taxpayers on these returns were common with the 2007 ITRs lodged over the Darmanin IP. ATO inquiries with Telstra then identified the IP service address for IP 60.230.45.62 as 10 Hall Street Newport Victoria in the account name of El Sayegh & Sons PTY Ltd T/A Newport General Store. Telstra records showed that the billing address of this account was 8 Nyanda Close Keilor Downs and that Rached El Sayegh was the listed authorized representative for the IP account and the
landline telephone associated with that IP internet account.25
Search warrants
20. The ATO with the assistance of the AFP arranged for search warrants to be executed at 8 Nyanda Close Keilor Downs, at 10 Hall Street Newport and 20 Copernicus Way Keilor Downs on 14 December 2007. The brother of the offender Ahmed EL Sayegh was at the Hall Street property when the police executed a search warrant the re. The police showed Ahmed El
Sayegh a copy of the warrant. 26 Mar Tarek EL Sayegh, the father of the offender, gave the
police access to the property at Copernicus Way Keilor Downs and he was provided with a copy of the search warrant for that place.27 At this time the property at Copernicus Way was unoccupied. The offender had departed Australia on 06 August 2007 and had recorded on his departure card he intended an intended three months stay overseas. The offender returned to Australia n 9 February 2015.28 Amongst the items that the police seized at the searched premises were:
23 Buscema voll p99. Francis Ja mes Fisher vollp191
24 Statement of materialfacts vol 1p3
25 Statement of Adam Gcl fe vol I p2 1 7
26 Statement of Dean R eynolds vol 4 p.l462
27 Statement of J ared Shawyer vol4 p .l 530.
28 Boris Jakovac p335. DIMIA Movement Details Card PAX card vo l 4p1252
• A computer CD-R titled "BackUP .Etax.NGS 7/08/2006 found by the police in a CD folder stored under a bed in a guest room at the Copernicus Way property .29
• A two page Westpac letter dated 12 January 2006 found at the 10 Hall Street property seeking from Mr. El Sayegh and Mrs. El Asaad repayment to the Reserve Bank of $9,244.00 credited to their account on 24 November 2005 in error .30 The Anna Barrios 2005 ATO tax refund payment had initially been electronically paid into the Westpac account of the offender on 24 November 2005.'1 When Mrs. Barrios complained to the ATO that she had not received it the ATO made another payment to her.
• Centrelink documents in the name of Mr.Rached El Sayegh of 74 Tarella Drive Keilor Downs.'2 The document indicates that Rached El Sayegh was receiving Newstart and Family Tax Benefits between September 2005 and December 2005 .
• 2005 PAYG employer Summary for Tapeta Keenan found at 10 Hall Street:'·'
21. ATO investigator Boris Jakovac accessed the computer CD-R found at Copernicus Way. The CD contained numerous f iles relating to taxpayers' details on an Excel spreadsheet including 11 of the taxpayers named in the schedules to the indictment. The CD also contained electronic copies of the lodged e-tax returns of some of these taxpayers . The copies indicate that prior to the final lodgement of each e-Tax return a lodgement page would be displayed on the computer screen to act as a warning that the taxpayer/lodger of the return was taken to be declaring the information in the ITR as true and correct. That page then required a manual confirmation prior to lodgement.'4
22. Between January 2009 and March 2009 the taxpayers provided written statements to the ATO investigator about their involvement with the lodgement of their ITR. They stated they had no knowledge of the false claims for expenses and false rebates and that they had trusted the offender to properly prepare their ITRs.
23. On 4 June 2009 the ATO referred the matter to the Commonwealth Director of Public Prosecutions. On 10 March 2011 42 deception charges against the offender were filed at the Melbourne Magistrates' Court and an arrest warrant was issued. The arrest warrant was
29 Property Seizure Record vol 1p223
3° Folder 4 p1206
31 Westpac statement folder 2 p3488
32 Folder 4 p.l219 Boris Jakovac p330
33 Folder 4 p1189.
34 Boris Jakovac folder 2 p307, p632 .
provided to Victoria Police on 17 March 2011 for execution on the return of the Offender to Australia .
24.In June 2014 a Victoria police Officer made inquiries at 8 Nyandah Close Keilor Downs with the father of the offender as to the whereabouts of the Offender . The offender returned to Australia on 12 February 2015. He was arrested and granted bail before a bail justice and remanded to a filing hearing on that day. At the filing hearing bail was extended to the committal mention date. On 3 July 2015 at the committal mention the offender pleaded guilty to 42 cha rges of dishonestly obtaining a financial advantage by deception and was bailed to his plea date .
Departure of the offender from Australia
25.In late July 2007 ATO Serious Non- Compliance Intelligence Unit officers telephoned 4 of the taxpayers including Kyle Muscat and Francis Fisher whose income tax returns had been lodged on the Darmanin IP service in order to ascertain whether they had received any assistance with their ITR. Co-incidentally about the same time of these ATO telephone calls to the taxpayers there were telephonic communications between the telephone number associated with the offender and the telephone numbers of Kyle Muscat and Francis
Fisher.35 It is alleged that the offender became aware of the ATO interest in the ITRs that he
had prepared for Kyle Muscat and Francis Fisher and that shortly thereafter he departed Australia .
Loss to the Australian Taxation Office ad reparation order sought
26.By inserting false information in the 42 ITRs the offender has caused a loss to the ATO of
$269,782.42. The ATO seeks a reparation order payable to the Australian Taxation Office of
$136,932.20. The offender has not repaid any amount to the ATO . The taxpayer Francis Maher lodged a disclosure of over claims in his 2007 ITR and sought an amended assessment. The ATO recovered from him $4,357.49 in tax and imposed a $698.34 shortfall interest charge on that assessment. The Francis Maher ITR related loss to the ATO is not included in the amount of $136,932 .20 that is sought to be declared under the reparation order .
Other matters
35 Buscema vol I p.l 04
There is no period of pre-sentence detention as at the date of the plea.
There is no co-accused.
. The offender is not to be sentenced as a serious offender or a continuing enterprise offender .
No provision imposing a minimum non-parole period is applicable .
The offending is not a baseline offence .
Annexure A
| NAME | SURNAME | DATE PAID | REFUND AMOUNT | FRAUD AMOUNT | ACCUSED PAID TO TAXPAYERS | AMOUNT RETAINED BY ACCUSED |
| Moemin | HUSSEIN | 4/11/2005 | 7,073.80 | 5,731.39 | 1,000.00 | 6,073.80 |
| Anthony | FALLETI | 11/11/2005 | 4,833.00 | 4,006.22 | 4,833.00 | |
| Anna | BARRIOS | 24/11/2005 | 9,244.00 | 7,912.68 | NIL | 9,244.00 |
| Brian | MAHER | 14/12/2005 | 4,805.00 | 3,263.20 | 2,000.00 | 2,805.00 |
| BelaI | MASRY | 14/12/2005 | 7,562.82 | 6,904.28 | 1,500.00 | 6,062.82 |
| Robin | TANNOUS | 20/12/2005 | 2,928.00 | 815.94 | 2,100.00 | 828.00 |
| Tapeta | KEENAN | 29/12/2005 | 9423.62 | 11,173.13 | NIL | 9,423.62 |
| TOTALS | $58,995.40 | $50,133.22 | $11,433.00 | $34,437.24 |
Annexure A
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