Director of Public Prosecutions v Chan

[2019] VCC 768

IN THE COUNTY COURT OF VICTORIA  Revised
Not Restricted
Suitable for Publication

AT MELBOURNE
CRIMINAL JURISDICTION

CR 18-02375

THE QUEEN

v

KE JIAN CHAN

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JUDGE:	HIS HONOUR JUDGE CARMODY
WHERE HELD:	Melbourne
DATE OF HEARING:	10 April 2019
DATE OF SENTENCE:	10 April 2019
CASE MAY BE CITED AS:	DPP v Chan
MEDIUM NEUTRAL CITATION:	[2019] VCC 768

REASONS FOR SENTENCE
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Subject:  CRIMINAL LAW

Catchwords:  Import tobacco products – defraud the commonwealth revenue.

Legislation Cited:  Crimes Act 1914 (Cth), Customs Act 1901 (Cth).

Sentence:Total effective sentence of four and half year’s imprisonment with a non-parole period of three years imprisonment.

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APPEARANCES:	Counsel	Solicitors
For the Queen	Mr K. Armstrong	Commonwealth Director of Public Prosecutions
For the Accused	Mr H. Rattray	Giorgianni & Liang Lawyers

HIS HONOUR:

1Ke Jian Chan, today, 10 April 2019, you pleaded guilty to one charge on indictment No.CR-1802375: 

Charge 1, import tobacco products contrary to s.233BABAD (1) of the Customs Act.  This charge has a maximum penalty of ten years' imprisonment. 

Circumstances of your offending

2The prosecution tendered a prosecution plea opening. It was Exhibit “A”.  In that document your offending is set out in detail.  A summary of your offending is as follows:

3On 3 August 2017, two importations arrived in Australia from Malaysia. 
The importations were consigned to the following companies and delivery addresses.  The first one was one shipping container numbered, and I will not read out the number, consigned to Totec Supplies Pty Ltd, at 3/11 Bryants Road in Dandenong.  The second was two shipping containers consigned to M&P Depot Pty Ltd, at 106 Derrimut Road in Derrimut.

4Both importations were intercepted by Australian Border Force (“ABF”) officers, who discovered cigarettes were secreted within those two importations. 
The ABF officers arranged managed deliveries of both importations to the consignee addresses on 10 August 2017, where persons receiving and unpacking the containers were arrested.

5On subsequent full deconstruction of the importations, the following were found to be contained in those containers.  In the Totec Supplies container, there were 2,016,000 cigarette sticks, constituting evaded customs duty and GST in the sum of $1,244,396.16.  In the two M&P Depot containers, 4,200,000 cigarettes were found in the two containers, constituting evaded customs duty and GST in the sum of $2,851,741.20.

6You and Jiankai Sim were the organisers of these importations and tobacco-smuggling syndicate at the Australian end of this criminal enterprise.

7At your committal hearing on 16 November 2018, you pleaded guilty to this charge before the court on the basis that your offending consisted of the following matters: 

(1), receipt of the tobacco from the syndicate members from overseas;

(2), arranging the establishment of companies and warehouses to facilitate the importation of the tobacco to Australia;

(3), arranging the receipt of the tobacco at the warehouses;

(4), arranging the unpacking of the tobacco shipments here in Australia;

(5), sourcing purchases and/or the distribution of the imported tobacco, and;

(6), recruiting or management of third parties to assist in the first of those four items I have just read out.

Investigation – Telephone Intercepts

8Prior to your importations, the authorities were investigating your activities in Australia.  The investigations consisted of telephone intercepts, and I am going to read from the summary the relevant intercepts. 

9Between December 2016 and May 2017, investigators intercepted telephone conversations between yourself and other people, including the co-accused,
Mr Sim, using telecommunication services.  Those calls included the following:

(1), On 11 December 2016, you and an unknown male discussed the cigarette business and mixing the containers - maybe 1000 cartons per container;

(2), On 16 December 2016, you and Mr Sim discussed signing agreements for warehouses, creating company email addresses, depositing money in company bank accounts, and registering false phone numbers for the company;

(3), On 19 December 2016, you discussed hiring workers and unpackers for the warehouse and using Malaysians on student visas to travel to Australia to do the unpacking;

(4), On 20 December 2016, you discussed signing a two-year lease on a factory, and whether the boss, referring to those in Malaysia, was going to fill the container with 'that thing' or only half-fill it.  The response was that there was no way a full container would get through, meaning through Customs. 
It was indicated that there would be 100 cartons or boxes inside, and an indication imports were due to commence in January or February 2017;

(5), On 21 December 2016, Mr Sim asked you to retrieve documents from the agent in Dandenong and to get Hong Tan, a director of Totec Supplies, to sign them.  The lease was to be settled on that Friday;

(6), On 23 December 2016, You and a female who is not known discussed that cigarettes were merely tax evasion and less harmful than drugs, meaning importing drugs;

(7), On 5 March 2017, Mr Sim and yourself discussed the need to find buyers for the cargo that comes with the cigarettes, and that the boss was prepared to sell those at a loss, just enough to cover the basics.  You and Mr Sim discussed that there would be a number of clean importations and that 'the real stuff will come after we've run a few rounds.'  You also discussed the recent arrest of tobacco importers and the gaol sentences to be expected for tobacco importation as compared to the penalties for drug importations.  Mr Sim said that, on his calculation, the cost of the logistics would be at least $1 million Australian dollars, and that if they had five factories, it would be the equivalent of 50 containers;

(8), On 5 April 2017, Mr Sim and yourself discussed you arranging two people to unload the container within a week.  Mr Sim said he was not sure if the shipment was cigarettes, but he did not think so.  Mr Sim said he would help to “download” if he was free, but his boss had told him, 'Open the door and leave each time so that no-one could recognise me.'  You both then discussed an arrest of drug importers and police tactics in apprehending importers, which Mr Sim said he would let his boss know.

10On 31 July 2017, you told Hong Chew Tan that you heard that two containers would arrive, but you really didn’t know.

11These intercepts clearly show that you knew the risks of your offending but you were attracted to this offending by the profits you were going to make.  I have been unable to properly assess the level of financial reward you made or expected to make from these importations, but that was your motivation.

Arrest and Interview

12You were born on 31 March 1990.  You are a Malaysian national, and you came to Australia on 31 May 2012 on your Malaysian passport.  On 21 August 2012, while you were still in Australia, you submitted an application for a student visa.  You were granted the student visa application on 22 August 2012.

13You enrolled in a Technical Education Development Institute for the June 2017 intake, which was due to commence on 3 July 2017.  You paid a total of $1,500 for that course.  The last payment you made was on 15 June 2017.  You did not attend any classes with the Technical Education Development Institute, and you were not issued with any transcripts or completion certificates by that institute. 

14On 12 January 2016, you were issued with a new Malaysian passport.

15On 13 August 2017, you arrived at Melbourne International Airport.  On that day, you entered the international departures area and presented at the outwards control point with the intention of flying from Melbourne to New Zealand.  You were intercepted by Australian Border Force officers at that time. On the same day, Mr Sim was also arrested by Australian Border Force investigators at Melbourne Airport as he was preparing to fly home to Malaysia.

16At 12.50am on 14 August 2017, you participated in a formal record of interview with Australian Border Force and ACIC officers in Melbourne International Airport.  During the interview with those officers, you stated as follows:

17(1), That you were approached by a person known to you as 'Edwin' to locate factories in Australia and find people to work in the factories.  I note here that Edwin is the common name that Mr Sim goes by;

18(2), That you assisted in the registration of the companies M&P Depot Pty Ltd and Totec Supplies Pty Ltd;

19(3), That M&P Depot Pty Ltd was registered in the name of one of your friends, ‘Fuyi Yiap’;

20(4), Fuyi Yiap was paid $2,000 to be a director of M&P Depot Pty Ltd;

21(5), That you were paid $900 to open the company for Edwin;

22(6), That the goods for M&P Depot Pty Ltd were being sent to a factory at
106 Derrimut Drive in Derrimut;

23(7), The company Totec Pty Ltd operated from a factory in Dandenong;

24(8), That you located a person by the name of ‘Hong Tan’ to set up Totec Supplies Pty Ltd;

25(9), That you had been to the factory in Dandenong on three separate occasions;

26(10), That you had attended the Dandenong factory in June - that was June 2017 - and were asked by Edwin to unpack boxes on that occasion;

27(11), That no-one else was there when you unpacked the goods, and that Edwin gave you the key to the factory;

28(12), That you would get a call that a container was arriving and that you attend the factory to take delivery of the container when it arrived;

29(13), That Edwin promised you $5,000 to find a person to set up the business, and $200 for every time you took delivery of a container;

30(14), During the meeting with Edwin a few days prior to your departure, Edwin had told you something went wrong with the two companies and it was about a delivery of cigarettes;

31(15), Edwin told you he was moving cigarettes 'and they all need to be more careful';

32(16), You purchased an international flight on the day of travel because of what you had been told the day before, and that you did not want too much trouble, and that you panicked, and;

33(17), You understand that anything that is considered imported goods must have tax paid on it.

34Later in the morning of 14 August 2017, you were arrested at the airport, escorted to City West police station where you were subsequently charged with importing tobacco products with the intent to defraud the Commonwealth of revenue.

35As I say, you are a Malaysian national.  At the completion of your term of imprisonment, you will be deported to Malaysia.  You have spent 605 days in pre-sentence detention awaiting the finalisation of these charges. 

Personal Circumstances

36You are 29 years old.  You are a citizen of Malaysia.  You are the only son of your parents.  You have three sisters.  One of your youngest sisters lives here in Melbourne.  Your father requires dialysis treatment and does not work.  Your mother is now engaged as your father's carer.

37You were educated to the equivalent of Year 9 in Malaysia.  You attended as many as 13 different primary schools.  After leaving school, you worked as a kitchen hand in Malaysia.  You came to Australia in 2012.  This was the year after your father was diagnosed with his diabetes.  Upon arrival in Australia, you attended English courses for two semesters.  You have not attended any other courses.

38You worked part-time at Papa Rich in Glen Waverley as a kitchen hand, and other places as a kitchen hand.  You worked there for approximately five years.  You sent funds home to support your family.  In 2013, your wife joined you in Australia.  Shortly before your arrest, your wife returned to Malaysia.  At the time of her return, she was pregnant with your son.

39You have been in custody since your arrest on 14 August 2017.  As I said before, you were arrested at the Tullamarine Airport whilst attempting to get on a flight to New Zealand and escape Australia. You spent a total of 605 days in pre-sentence detention. 

40Whilst you have been in custody, you have completed a number of courses.  At the moment, you work as a store billet.  You have a limited grasp of the English language, but I note your letter to the court shows some proficiency in the written word.  You have no prior criminal history. 

Sentencing Considerations

41The most significant consideration in sentencing a Federal offender such as yourself is s.17(a) of the Crimes Act, which provides as follows:

'The court shall not pass a sentence of imprisonment on any person unless the court, having considered all other available sentences, is satisfied that no other sentence is appropriate in all the circumstances of the case.'

42A term of imprisonment is the only appropriate sentence for your offence. 

43Section 16A of the Crimes Act, sets out a non-exhaustive list of factors a court must take into account and take into consideration when sentencing a Federal offender like you.  There are many factors I must take into account, and they are set out in that section.  These factors include the following matters:

44(a), The nature and circumstances of your offending;

45(b), If your offending forms part of a course of conduct consisting of a series of criminal acts.  In this case, there is one discrete charge relating to two importations of tobacco products;

46(c), Any loss or injury or damage resulting from the offence - in this case, it is a loss to the Commonwealth revenue in the sum of approximately $4 million Australian dollars;

47(d), The degree to which a person has shown contrition for the offences. 
In your case, your remorse is confirmed by your plea of guilty, and in part, your admissions to the police when they interviewed you;

48(e), That you pleaded guilty to the offence;

49(f), That the deterrent effect of any sentence or order under consideration may have on you personally - that is, specific deterrence;

50(g), The deterrent effect that any sentence under consideration may have on other persons - that is, general deterrence.  In a case such as this, general deterrence is a prime consideration;

51(h), The need to ensure that you are adequately punished for your offending;

52(i), Your character, antecedents, age, means and physical and mental condition;

53(j), The prospects of your rehabilitation, and;

54(k), The proper effect any sentence or order under consideration would have on your family.

55You have indicated a plea of guilty to the present charges before the court. 
You confirmed your intention to plead guilty at the committal hearing on
16 November 2018.

56Your plea does have a utilitarian value for the orderly and effective administration of justice.  There is a certainty of outcome and a resolution of the substantive issue is raised by your offending.  Your plea allows for the preservation of court and investigative resources to deal with other matters, and your plea vindicates the public confidence in the legal process set up to protect the community.

57Your plea is also a clear indication and acknowledgment by you that you accept responsibility for your criminal behaviour.  Your plea also recognises that you are willing to facilitate the course of justice in this community, and I accept that your plea to this charge does demonstrate some remorse on your part.  Your plea of guilty is significant in this particular case because of the number of witnesses that would have been required to attend court at a trial. 

58At the time of your offending, you were 27 years old.  You have been in Australia since 2012.  You have no prior convictions either in Australia or in your country of birth.  You are to be sentenced as a person of previous good character.

59I am required to take into account current sentencing practices in respect of the charge of defrauding the Commonwealth by smuggling of tobacco products.  In 2012, Parliament increased the maximum sentence to the fivefold to the current maximum of 10 years' imprisonment.  The penalty also applies equally to importing and to possession charges.  You are charged as an importer of the tobacco products.

60Some of the people you organised for this criminal syndicate have been sentenced for the charge of possession of tobacco products knowing they were importing to defraud the Commonwealth.

61On 31 May 2018, Yunn Chang Fang was sentenced to two years imprisonment and to be released after serving a year on a $2,000 recognizance release order.  The amount of duty in his case was $1,244,396.  On 16 August 2018, Que Cheng was sentenced to 26 months imprisonment and to be released after serving 18 months' imprisonment on a $2,000 recognizance release order.  On the same day, Wee Chong Tan was sentenced to 24 months imprisonment and to be released after serving 14 months' imprisonment on a $2,000 recognizance release order.  The amount of the fraud in their two cases was $2,851,741.

62Most relevantly, your co-accused Jiankai Sim was sentenced by Judge Riddell of this court on 20 February 2019.  Mr Sim was sentenced to a total effective sentence of five years imprisonment with a three-year non-parole period.

63The offending by yourself and Mr Sim had parallel features.  You are both the principals of this tobacco importation business on the ground here in Australia.  You were acting under the direction of others who remained in Malaysia.  Parity in sentencing is relevant in a case such as this, and your co-accused Jiankai Sim is the closest to your role in this offending.

64There are minor differences between yourself and Mr Sim.  I accept he was your contact to get into this criminal business.  Mr Sim came to Australia close to the time of the offending.  You had been here for years prior to your involvement in this offending.  You have a newborn son in Malaysia.  Your father is in the end stage of renal failure as a result of diabetes back in 2011. These differences between you and your co-accused leave me to conclude a sentence slightly more lenient than Mr Sim is appropriate in this case.

65You of course are charged with importing cigarettes amounting to a fraud on the Commonwealth of $4,096,137.  That is the addition of both of the amounts in relation to your assistance that I referred to earlier. 

66Your offending is against the revenue, and is of large scale fraud of $4 million Australian dollars.  Your role was that of the organiser and coordinator of the other offenders who performed various tasks at your request to carry out this criminal exercise here in Australia.

67At the time of the offending, you were a guest in this country on a student visa and took this criminal option in order to make easy money.  You have just turned 29 years old.  The detection of this crime is difficult. The Australian end of this criminal enterprise, or activity - you are the principal in the organisation. 
The sophistication of the offending required incorporation of companies, leasing a factory premises, arranging importation documents, organising people to unpack the shipping containers.  As I say, the amount of the fraud was greater than $4 million Australian dollars. 

68I found it difficult to assess your prospects of rehabilitation. It is clear that you will be deported after you have completed your sentence. The fact of your deportation does not affect my power to fix a non-parole period in your case, pursuant to s.19AK of the Crimes Act. 

69I accept that you will been in custody a foreign country, where it is impossible to have contact visits with your family members, and it will make your time in custody more burdensome.  You have a young child who you have not seen, and a very ill father in Malaysia.  Weighed against that is the criminal activity the subject of the charge and the fact that you have been in Australia as a student but only attended a basic English course.  You never attended the TAFE course you were enrolled in.

70Your offending in this instance is serious, and the considerations of general and specific deterrence and just punishment dictate that a substantial term of imprisonment is the only appropriate sentence.

71Will you stand, please?

72On Charge 1, you are convicted and sentenced to four-and-a-half years' imprisonment.

73I fix a non-parole period of three years' imprisonment.

74I declare that you have served 605 pre-sentence detention in respect of this sentence.

75And pursuant to s.6AAA, but for your plea of guilty in this case, I would have sentenced you to a term of imprisonment of six years' imprisonment and fixed a non-parole period of four years.

76MR ARMSTRONG:  As the court pleases.

77HIS HONOUR:  Is there anything further?

78COUNSEL:  No, Your Honour. 

79HIS HONOUR:  Thank you.  Can I just check with Commonwealth sentences, do I have to declare a start date?  I know in recognizance release orders and the like, or with State sentences, I do.  But I just want to check.  The way I have announced that, is that appropriate?

80MR ARMSTRONG:  Yes, I think if Your Honour wants to make it express, you could indicate that the sentence starts today.  But that would have the normal effect then of 605 days would be taken into account.  But there are not multiple sentences, multiple charges, so ‑ ‑ ‑ 

81HIS HONOUR:  That is right.  It is just one.

82MR ARMSTRONG:  Yes. 

83HIS HONOUR:  Yes, all right.  I will think anyone who reads it will know what it means.

84MR ARMSTRONG:  Yes, Your Honour. 

85HIS HONOUR:  Thank you, both counsel, for your submissions and opening and taking me through those intercepts.

86MR ARMSTRONG:  As Your Honour pleases.

87HIS HONOUR:  Madam Interpreter, I want to thank you for your assistance in this case today.

88INTERPRETER:  Thank you, Your Honour. 

89HIS HONOUR:  Thank you. 

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