Director of Public Prosecutions v Dunner

[2017] VCC 985

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

AT MELBOURNE
CRIMINAL JURISDICTION

CR 16-00294

DIRECTOR OF PUBLIC PROSECUTIONS

v

ANDREW LEONARD DUNNER

---

JUDGE:	HER HONOUR JUDGE PATRICK
WHERE HELD:	Melbourne
DATE OF HEARING:
DATE OF SENTENCE:	26 June 2017
CASE MAY BE CITED AS:	DPP v Dunner
MEDIUM NEUTRAL CITATION:	[2017] VCC 985

REASONS FOR SENTENCE
---

Subject:
Catchwords:
Legislation Cited:
Cases Cited:
Sentence:

---

APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Mr J. Dickie
For the Accused	Mr S. Ginsbourg

HER HONOUR:

1Andrew Leonard Dunner, you have been found guilty by way of jury verdict on Charge 1 on indictment CR1600294 of dishonestly obtaining a financial advantage by deception from a Commonwealth entity.  The maximum penalty for that offence is ten years' imprisonment and/or a fine of $66,000.

2You were found not guilty on a further 15 charges of attempting to dishonestly obtain a financial advantage by deception from a Commonwealth entity.

3Your offending occurred in the following circumstances.  On 26 March 2007, a company called McSarge Pty Ltd was registered as an Australian propriety company.  On 15 September 2010, the Australian Securities and Investments Commission was notified that McSarge Pty Ltd was the subject of a voluntary winding up and that you had been appointed as liquidator.  You had, for many years, practiced as a liquidator through a business called Andrew Dunner and Associates.  At that time, there was a Federal Government funded program to provide assistance to ex-employees of liquidated companies.  The program was the General Employee Entitlement Redundancy Scheme, GEERS, which was administered by the Department of Education, Employment and Workplace Relations, DEEWR.  Ex-employees could claim for various unpaid entitlements up to capped amounts.

4On 29 October 2010, Andrew Dunner and Associates lodged a claim with DEEWR in the name of Adam Stoodley.  The claim was for $41,394.21 in unpaid entitlements from McSarge Pty Ltd.  The claim was false because Adam Stoodley had not been employed by McSarge Pty Ltd for the relevant period and was not entitled to any GEERS assistance.  The claim form is accompanied by a false letter of appointment purporting beyond McSarge Pty Ltd letterhead.  Adam Stoodley is the son of a friend of yours, David Stoodley.

5On 30 March 2011, you arranged for the setting up of a bank account as trustee for McSarge Pty Ltd into which any GEERS payments could be made.  Where a GEERS claim was submitted through a liquidator, DEEWR relied on the liquidator to verify the claim.  If the liquidator could not do so, or the claim was made by the claimant without involving the liquidator, the claimant could seek to verify the claim using a different process.

6On 1 April 2011, you signed an initial verification statement with respect to McSarge Pty Ltd and the Adam Stoodley claim.  Your employee, Matthew Giliberto asked you about the verification of details to be included in a spreadsheet to be sent to DEEWR as part of the verification process.  You told him you could verify the amounts.  The false spreadsheet was sent to DEEWR on 29 April 2011.  You knew that Adam Stoodley was not entitled to make a GEERS claim and that you could not verify the amounts claimed.

7On 20 June 2011, DEEWR paid $27,403.88 into the McSarge Pty Ltd account in payment of the Adam Stoodley claim.  You sent $18,773 of that amount to David Stoodley in a check made out to David Stoodley and signed by you.  The check butt referred to Adam Stoodley.  The balance was paid to the Australian Taxation Office.  The initial false claim form and accompanying documentation was created by David Stoodley with the assistance of Mr Kerry McDonald.

8A search warrant was executed at Andrew Dunner and Associates on 29 October 2012.  You, David Stoodley and Kerry McDonald were all charged on 23 May 2014.  You were committed for trial on 1 September 2014.  During the committal proceedings, Mr Stoodley and Mr McDonald indicated their intention to plead guilty.

9Mr Stoodley was sentenced on 21 January 2015 on the basis that he had organised the Adam Stoodley claim, had obtained the assistance of Kerry McDonald and had contacted DEEWR pretending to be Adam Stoodley.  He was sentenced to 12 months' imprisonment with immediate release on recognizance release order.

10Mr McDonald was sentenced in respect of the Adam Stoodley claim to four months' imprisonment.  He had created and supplied a further 15 false claims which were submitted through Andrew Dunner and Associates to DEEWR.  You advised DEEWR that you could not verify those claims.  You were found not guilty by the jury of attempting to obtain financial advantage.  In respect to those 15 claims, Mr McDonald was sentenced on 5 December 2014 to 12 months' imprisonment with immediate release on a recognizance release order.

11The prosecutor submitted that you should be sentenced on the basis that you expected to get some form of payment or kickback from David Stoodley.  The prosecution submitted that that was the only logical explanation for your offending.  I do not accept that submission.  Your motive remains unclear but you could have had some other reason for acting as you did, including misplaced loyalty to your friend, David Stoodley.

12In sentencing submissions, your counsel conceded that a sentence of imprisonment would be appropriate but submitted that you should be released immediately on a recognizance release order.  Your counsel relied in mitigation and in support of your immediate release on factors including (a) your role in the offending, (b) the lack of net loss to the revenue given Mr Stoodley repaid the amount he obtained, (c) your lack of prior or subsequent convictions, (d) your prospects of rehabilitation and (e) the delay.

13In respect of your role, your counsel submitted that Mr Stoodley was the prime mover and that, while your role was important, it was not essential.  Your counsel address parity considerations with respect to Mr Stoodley.

14Your counsel addressed your prospects of rehabilitation.  Four character references were tendered as Exhibit 2.  A further reference from your ex-wife was tendered as Exhibit 3.  Those references are positive in respect of your professional competence and your character in private family and professional capacities.  I have been told that you have no intention of returning to work as a liquidator.  Your counsel submitted that this would mean that further offending would be unlikely.

15Your counsel submitted that the delays should be taken into account in mitigation as there had been no further offending and the matters had been hanging over your head for some time.

16The prosecutor in sentencing submissions submitted that an immediate term of imprisonment was the appropriate sentence. The prosecutor addressed relevant sentencing factors including those set out in s.16A(2) of the Crimes Act 1914 Commonwealth. The prosecutor submitted that aggravating features of your offending were the breach of trust placed in liquidators to provide reliable information, and the way in which you had used your employees.

17The prosecutor submitted that scheme such as the GEERS Scheme were open to abuse and that offences were difficult to detect and difficult to prosecute.  He emphasised the need for general deterrence.  The prosecutor submitted that your prior good character should be of less significance because you were in a position of trust.

18The prosecutor submitted that your role in the submission and verification of the Adam Stoodley claim was central.  The prosecutor accepted that you had prospects of rehabilitation but submitted that there should be some caution expressed due to Australia Securities and Investments Commission proceeding, which I will describe shortly.

19The prosecutor submitted in respect of delay that that was due in part to resource issues and a complex investigation after the initial audit process.  The prosecutor submitted that there should be some limited regard for the delay, due to the fact that the matter had been hanging over your head for some time.

20In terms of parity, the prosecutor submitted that there were different sentencing considerations in respect to Mr Stoodley and Mr McDonald.  Both have pleaded guilty and expressed remorse.  Mr McDonald pleaded guilty to greater offending.  Mr Stoodley had relevant prior convictions.  Both received a discount for their plea of guilty and Mr McDonald received an additional discount of 15 months for undertaking to give evidence in your trial.

21The prosecutor said he had tried unsuccessfully to find any comparable decisions at appellant level to which I could be referred.

22In sentencing you, I have taken into account your personal circumstances.  You are now 66 years old.  You are the eldest of four children.  You have two adult daughters from a former marriage.  You have been in a de facto relationship with your current partner for two and a half years.  You completed a Bachelor of Commerce degree at Melbourne University in about 1974.

23You were employed as an accountant by three firms over the next approximately 15 years.  You worked as a principal accountant for the next approximately 22 years, with 19 years of those years being a sole principal at Andrew Dunner and Associates.

24Your counsel advised that Andrew Dunner and Associates had effectively ceased trading in 2013 following the commencement of an ASIC instituted enquiry in the Federal Court into your conduct as a liquidator and controller of 12 companies between 2008 and 2012.  In those proceedings, you were order to repay amounts of remuneration which had been paid.  You were prohibited from applying to ASIC for registration as a liquidator for five years without first obtaining leave of the court.  ASIC v Dunner [2013] FCA 872.

25You became bankrupt in 2015 as a result of the debts arising from that decision.  Your bankruptcy has been extended to 2023.  You have since earned limited income from business consulting of about $20,00 per annum and receive some financial support from your partner.  I was advised that the business consulting work was not accountancy work.  Although you are able to practice as an accountant, you cannot practice as a certified public accountant or chartered accountant.

26Andrew Dunner, your offending is serious, particularly because you offended as a liquidator.  You had professional responsibilities as a liquidator.  Your role in the GEERS Scheme was very important.  Liquidators are in control of companies in liquidation.  There you are, as it was then relied on, liquidators to verify GEERS claims by reference to company documents.  In this case, the claim was made through you as liquidator.  In that circumstances, the liquidator would do as you did and that is forward the claim and any accompanying documents.  The liquidator was then relied upon to engage in a verification process.

27In this case, clearly there were no supporting documents apart from one letter of appointment which was false.  On the facts as known to you, Andrew Stoodley was not entitled to claim GEERS payments, and yet, you dishonestly went ahead with the verification process, including assuring Matthew Giliberto that you were able to verify the details on the spreadsheets sent to DEEWR.  In that respect, your moral culpability is high.  Your offending constitutes a serious breach of your professional responsibilities as a liquidator and a breach of trust in respect to DEEWR.

28The burden of fraud on the Commonwealth falls on the whole community.  In this case, Mr Stoodley repaid the amount he received, but the costs and consequences of your offending have been considerable.

29This type of offending is easy to commit and difficult to detect.  General deterrence is a very important sentencing consideration.  Those people who are relied upon by authorities in their professional capacity must be aware that they will be significantly punished if they breach the trust placed in them.

30I consider that specific deterrence should have limited weight.  You have no prior criminal history.  Your behaviour in respect to your responsibilities as a liquidator was the subject of ASIC proceedings.  That behaviour was described as follows.

"The conduct in question indicates a systemic failure of administrative and internal protocols, as well as (in a number of instances), extremely more poor professional judgment." 

ASIC V Dunner [2013] FCA 872.

31Those matters are concerning from a professional responsibility point of view, but there is no allegation of dishonesty or fraud.  The references provided your relative lack of future opportunity to offend and having been subject to this process, lead me to the conclusion that you have good prospects of rehabilitation in respect of dishonesty or fraud type offending.

32I have taken into account in mitigation your previous good character.  I have also taken into account in mitigation the delay.  There has been a very significant delay in this matter, particularly in the period from when the search warrant was executed.  It appears that there was some initial delay due to an internal audit that was carried out and the subsequent investigation.  Those matters meant that you were not charged until some years after the search warrant had been executed.  There were then further delays due to court processes, including processes in respect to your co-accused.

33I am sentencing you in 2017 for offending in June 2011.  During that period of time, you have not reoffended.  The matter has been hanging over your head.  That includes 15 charges of which you were found not guilty concerning the further 15 false GEERS claims.  Your conduct in respect of those claims was markedly different and a jury found you not guilty of attempt.  Those 15 charges were serious and involved a very considerably large amount of money, which was being falsely claimed.  Those charges potentially exposed you to a significantly larger penalty.  You have had the anxiety of those charges also hanging over your head for many years.

34I have considered parity considerations.  There is no direct comparison between your situation and that of Mr McDonald or Mr Stoodley.  Mr McDonald was sentenced in respect of very different offending and circumstances.  There were very different sentencing considerations in respect of Mr McDonald and Mr Stoodley.

35I consider that a sentence of imprisonment is the only appropriate sentence for the purposes of denunciation, just punishment and general deterrence.  Your lack of prior criminal history, prior good character, good prospects of rehabilitation and the impact of delay lead me to the conclusion that it is appropriate to order your immediate release on a recognizance release order.

36Could you please stand up, Mr Dunner.

37I announced earlier that the sentence I intended to impose involved a recognizance release order, which would go for a period of 24 months.  That recognizance release order would provide a recognizance amount of $1,200.  It would also require you to be of good behaviour for the next 24 months.

38Are you prepared to enter into such a recognizance?

39OFFENDER:  Yes, Your Honour.

40HER HONOUR:  Thank you.

41Andrew Leonard Dunner, you are convicted and sentenced to 12 months' imprisonment.  I order your immediate release on a recognizance release order, with a  recognizance of $1,200.  The recognizance release order is to go for 24 months.  There are no further special conditions.

42Thank you.  Could you please take your seat.

43OFFENDER:  Thank you, Your Honour.

44MR DICKIE:  Your Honour, a formal order has been prepared by Ms Towns.

45HER HONOUR:  Good, thank you.

46MR DICKIE:  And Your Honour, I would appreciate that ordinarily, that is seen by Your Honour and then seen by Mr Dunner.

47HER HONOUR:  It is.

48MR DICKIE:  So, if I can hand up a copy for Your Honour.

49HER HONOUR:  Thank you.  Yes, thank you.  I will sign it and the Mr Dickie, if you could go with my associate to obtain Mr Dunner's - sorry, Mr Ginsbourg will do that.  Sorry.

50MR DICKIE:  Yes, thank you, Your Honour.

51HER HONOUR:  Thank you, Mr Ginsbourg.  Could you accompany Ms Ollquist to obtain Mr Dunner's signature.

52Mr Dunner, you understand that the consequences of signing the recognizance release order are that if you commit any offence during the next 24 months, you can be brought back before me for re-sentencing and consideration of the sentence that I have imposed.  You understand that?

53OFFENDER:  Yes, I do, Your Honour.

54HER HONOUR:  Thank you.

55OFFENDER:  Thank you.

‑ ‑ ‑