Director of Public Prosecutions v Henriquez Machado

[2024] VCC 1792

IN THE COUNTY COURT OF VICTORIA

Revised

Not Restricted

Suitable for Publication

AT MELBOURNE

CRIMINAL JURISDICTION

CR-24-00524

DIRECTOR OF PUBLIC PROSECUTIONS

v

EIDER HENRIQUEZ MACHADO

---

JUDGE:	HIS HONOUR JUDGE MAIDMENT
WHERE HELD:	Melbourne
DATE OF HEARING:	11 October 2024
DATE OF SENTENCE:	8 November 2024
CASE MAY BE CITED AS:	DPP v Henriquez Machado
MEDIUM NEUTRAL CITATION:	[2024] VCC 1792

REASONS FOR SENTENCE

---

Subject:Plea - sentencing

Catchwords:          Obtain financial advantage by deception – attempt to obtain financial advantage by deception

Legislation Cited: 

Cases Cited:Director of Public Prosecutions v Simmons [2024] VCC 665,
Director of Public Prosecutions v Bulfin [1998] VR 114,
Dyason v The Queen [2015] VSCA 120

Sentence:3 years and 4 months' imprisonment, non-parole period 2 years

---

APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Mr P. Pickering	Office of Public Prosecutions
For the Accused	Mr S. Norton	Stary Law

HIS HONOUR: 

1Eider Jose Henriquez Machado, you have pleaded guilty to six charges on the indictment.  The first four are all offences of obtaining a financial advantage by deception, Charges 1 and 2 being rolled-up charges of that kind.  The maximum penalty for each of these offences is imprisonment for 10 years.  You have also pleaded guilty in Charges 5 and 6 to offences of attempted obtaining a financial advantage by deception.  The maximum penalty for each of those offences is imprisonment for five years.

2You have no prior convictions.

3The prosecution tendered and read to the court an amended summary of prosecution opening for plea dated 9 October 2024.  At the time of the offending in 2022 and 2023 you were 37 and 38 years of age and you are now aged 39 years, almost 40.

4You were residing at a house in Ridely Avenue, Avondale Heights. 

5You commenced employment with Figurehead Constructions Pty Ltd in April 2021. It was against that company that you engaged in your offending conduct, taking advantage, as you did, of your position as chief financial officer. 

6You signed an employment contract which stated, amongst other things, 'Prior approval for expenditure must be obtained' from your manager … Your employment authority with Figurehead is not to be used for purchasing items of a personal nature or obtaining personal credit … Likewise credit accounts and/or facilities are not to be used for personal purchases.’ 

7You were issued with a National Australia Bank business credit card in the name of the company, with a credit limit of $60,000. 

8The card was not to be used for personal use.        

9As the chief financial officer of the company, you were required to oversee the finances and expenditure of the company and to prevent misuse of funds of the kind involved in your offending.

10In addition to the National Australia Bank credit card that was issued to you for company expenses, the company also had an American Express card which was issued to the managing director, Mr Joe Grasso.  You did not have an entitlement to use that card.  The physical card was kept in the possession of Mr Grasso and you were only entitled to use the card to make payments on the instruction of Mr Grasso where a personal expense of Mr Grasso was to be paid immediately.  Mr Grasso would then reimburse the company for that expense.

11Between 5 February 2022 and 28 February 2023, you repeatedly used the company National Australia Bank credit card issued to you for your personal use.  After making payments for non-company expenses, you engaged in deceptive conduct whereby you would submit an altered invoice or receipt.  This allowed you to disguise your purchases as company expenses.  On other occasions, you would create false invoices for work-related expenses to pay for personal items. 

12That offending is reflected in Charge 1 as a rolled-up charge. By use of that methodology you obtained by deception a financial advantage by evading debts in the total sum of $124,529.71.  By that same methodology you attempted to evade a debt in the sum of $8,240. That is reflected in Charge 6.

13You also generated false invoices unrelated to purchases made by you which were submitted to the company finance team for payment.  These false invoices purported to be issued by genuine businesses that had dealt with the company and which were invoicing for services purportedly carried out for the company, thereby enabled payments to be diverted to your personal accounts.  The total amount that you obtained in that manner, reflected in Charges 2 to 4 inclusive, was $782,754.50.

14You made a further attempt to obtain a sum of $35,064.04, which was unsuccessful.  It is reflected in Charge 5 on the indictment.

15I do not propose to go into detail about the methodology of your offending but it seems that your dishonest conduct enabled you to pay for demolition work and other works at your family home, or other family property, and for you to obtain tools, white goods, luxury items and furniture. 

16The sums referred to in Charges 1 to 4 inclusive total $907,284.21.  The two charges of attempt, Charges 5 and 6, total a further $43,304.04.

17On 1 March 2023, some of your offending was discovered by other company personnel.  Further enquiries ensued and a meeting was held with you at the company premises on 15 March 2023.  At that meeting you denied wrongdoing and falsely claimed that your wife must have used the wrong credit card.   

18However, on 17 March 2021, you signed a deed of release in which you agreed to pay the sum of $21,225.95 by way of reparation. 

19Your conduct in the process of negotiating that settlement was a deceptive attempt by you to minimise the amount you had obtained dishonestly and to confine the amount of reparation you would be required pay your employer to what had been discovered at that stage of the company investigations.  You repaid the sum of $21,225.95 on 29 March 2023.

20However, on 22 June 2023, after further investigation by the company and by police, you were arrested. You participated in a tape-recorded interview, largely making 'no comment' answers to the allegations against you, as you were quite entitled to.  You gave no assistance to the investigation, neither did you admit the true extent of your offending conduct.

21The prosecution also tendered a victim impact statement provided by Giuseppe (Joe) Grasso, the owner and managing director of your employer company.  I do not need to repeat what he said in that statement. Suffice to say that your conduct clearly had a significant impact on Mr Grasso and on the company. It was a construction company which, like any construction company, would no doubt have suffered considerably during the economic downturn of the Covid period.

22Turning to matters personal to you:  Your counsel provided me with an outline of plea submissions which is Exhibit 1.  It is dated 10 October 2024. 

23I was also provided with a report from Mr Peter Hanley, psychologist, coupled with a supplementary letter dated 8 October 2024.  That is Exhibit 2.

24I was also provided with a report from Mr Kyle Miller, psychologist, through whom you sought offence-specific treatment on 13 occasions between 12 March 2024 and 8 October 2024.  That is Exhibit 3.

25Exhibit 4 is a series of letters under the signature of Sasha Roshan, orthopaedic surgeon, concerning injuries for which you have recently received some medical treatment.  I note that you still have your crutches with you.  Indeed, when the matter was adjourned between the plea hearing and today, I granted you bail in order for you to pursue further consultations and treatment in relation to those injuries.  Collectively, those letters are Exhibit 4.

26Exhibit 5 is a series of glowing character references.  I will itemise them.  The first few are from representatives of the employer with whom you commenced employment on 22 May 2023, not long after you had ceased your employment with Figurehead.

27It is clear from those references, firstly, that you spoke to, and it seems came clean with, the chief executive officer of your employer, Nudo, about the offending that had come to light with your previous employer and which subsequently led to you being charged.  You were given responsibility by your new employer for which you performed extremely well and, it seems, created a very good impression from May 2023.

28Whatever difficulties you were having at your victim employer, Figurehead, you were able to pivot quite quickly into performing well at your new employer, despite what presumably were ongoing issues of the kind that you discussed with Mr Hanley and Mr Miller, and which you claimed adversely affected your employment at Figurehead.

29The letters from your colleagues at Nudo included one from Kim Brindell, one from Lauren Barrah, one from Paul Carr and one from William Campbell, the chief executive officer.  I also received a letter from Nancy Valderama dated 2 October 2024, a letter from Rosa Margarita Shardo Pote, your mother, a letter from Louis Alnasa Gonzalez, a letter from Christian Ibea Machado, your brother and a letter from Marion Alcala, who has known you for 23 years and to whom you are married.  She deals in some detail with the difficulties that you were apparently having in your employment at Figurehead and the issues that your marriage faced during that period.

30Next there is a letter from Caesar Remerez who has known you since 2021, a letter from Corina Sapata who has known you for 11 years, a letter from Helderth Carrero, your half-brother, a letter from Eduardo Napa, a friend for more than 12 years, a letter from Jenny Baptista, your sister, and a letter from Lewis Garcia, a close friend.

31Finally, and part of that exhibit which I collectively referred to as Exhibit 5, is a letter from you addressed to Joe Grasso apologising for your conduct.

32Your counsel in his plea referred to your background in Venezuela which no doubt was a difficult and somewhat deprived background, certainly one involving a very different way of life from that available in Australia. It was apparently attended by violence and crime all around you. 

33You did not have a stable upbringing.  Your father left the family when you were two or three years of age and you rarely saw him thereafter.  Your mother re-partnered.  You characterised your childhood environment as attended by domestic violence.

34Despite that difficult start to life, you showed extraordinary ability at school and went on to achieve excellence in tertiary education. 

35You met your wife at university in Venezuela, got married and the two of you migrated to Australia when you were 25 years of age, by which time you had achieved substantial positions with a firm of accountants in Venezuela which was part of the KPMG group.

36After migrating to Australia, you completed a Master of International Finance and Master of Business Administration at Deakin University. You worked for Crown Casino for about eight years in a significant role of financial responsibility. Ultimately you obtained your employment as chief financial officer with your victim, Figurehead.

37You have two children aged nine and seven. I accept entirely your concern about your children and the effect that your inevitable incarceration will have upon them, as well as upon your wife. The financial consequences to your whole family will be significant for a very long time.

38The expert reports suggest that you have a personality which has impacted upon your offending somewhat, and by the time you became employed by Figurehead you had been suffering from an adjustment disorder arising from the suicide of a good friend in 2019. That event had put pressure on your marriage.  It seems that you were drinking one to two bottles of wine daily and, during the period of your offending, were also abusing cocaine.

39The stresses and strains of your job I have no doubt were significant in that you had a great degree of responsibility, you were in a position of significant trust and it seems that you were keen to show your capacities. You took on extra work. I accept that you may have taken on more than was good for you.  That no doubt continued to feed into your alcohol abuse and your drug abuse, and other aspects of your personal life.

40It is not suggested that your mental state was such that it reduces your moral culpability for your offending, but it is clearly relevant in a general sense to the exercise of my sentencing discretion.

41Dealing with your motivations: as both psychologists have reported, you apparently felt suicidal and so affected by your adjustment disorder that you did not initially care about the consequences of being found out in your offending conduct. You then continued to offend after the first successful episodes of offending.

42I think it is noteworthy that you voluntarily engaged in therapy, beginning on 12 March 2024 and continuing through to just prior to the plea hearing.  Mr Kyle Miller, your therapist, indicates that your approach to treatment was pragmatic, approaching personal shortcomings with problem solving and conveying an eagerness to give a positive impression. Mr Miller expresses a ‘formulation’ of your offending, quoting from his report at paragraph 7, as:

'An opportunistic attempt to gain financial advantage and enhance his sense of status and esteem which was likely further influenced by nihilism, negative attitudes (about himself and others), impaired consequential reasoning and significant AOD use.'

43He goes on under the heading of 'Initial Treatment Engagement':

'During his initial treatment engagement, though Mr Machado verbalised responsibility for his offending behaviour, he tended to project blame onto his boss and focused on the negative culture of the workplace.  He said he felt devalued and underappreciated for his work, drawing distinctions to the self-assured status he maintains in his current workplace.  Cognitive distortions that reflected his limited insight into the exploitative nature of his offending conduct were evident.'

'Notwithstanding some barriers to adopting a posture of full responsibility for his offending, through the support of his previous therapist he showed an understanding of the nature of his mental health problems at the time of his offending, and the role of his cultural beliefs in his past reluctance to seek support.'

44Then Mr Miller notes at paragraph 10 that:

'As his understanding of his offending has developed, Mr Machado has expressed guilt associated with his offending behaviour in this way'

45He gives a number of quotes from you which ended with him quoting you as saying, 'Despite the fact I know some things now, it doesn't change the fact I am sorry for what I did.'

46Then at paragraph 11, Mr Miller goes on to say this:

'Whilst Mr Machado's understanding of his offending and his responsibility for his decision to offend has developed, it has not been evident that Mr Machado fully appreciates the exploitative nature of his offending behaviour towards the complainant company, relative to the position of trust and responsibility that he assumed.  Furthermore, his understanding of his reasons for offending continue to involve rationalisations that served to enable his offending behaviour.' 

'Based on his engagement with me, I expect that Mr Machado would be able to make further progress in addressing his outstanding needs with ongoing treatment, although it may take time for Mr Machado to be able to develop the perspective necessary to fully grasp the nature and implications of his offending behaviour.'

47That report is dated 9 October 2024.

48So, whilst it is suggested that you are remorseful, and certainly you expressed remorse in your letter to Mr Joe Grasso, it does not seem that you have yet reached a full understanding of the nature and implications of your offending behaviour, even at the date of that report, 9 October 2024, a year and a half after the conclusion of your offending conduct and having had more than ample time to reflect..

49On your behalf, Mr Norton stressed your difficult background.  He stressed the credit that you must receive for your plea of guilty at the earliest practical opportunity, that you are entitled to full credit for the utilitarian value of your plea and the fact that that is consistent with remorse. However, I am far from convinced that you are genuinely remorseful as distinct from being concerned about the impact on yourself, your family and your financial situation.  The evidence suggests genuine remorse for your offending conduct is yet to be achieved.

50In that regard, whilst you did pay back 21,000-odd dollars, that repayment was clearly aimed at obtaining a deed of release before your victim company and the police had fully discovered the extent of your criminality.  You made no attempt during the course of the investigation to assist in unravelling the full extent of your offending.

51I take note of your mental health issues.  It is not suggested that the Verdins principles apply, save that your mental health will make some contribution to the difficulties you will find in doing your time. I have no doubt that the fact that you have left your family in a parlous financial state and put further financial pressure on your wider family in Venezuela will play heavily on your mind during your period of incarceration. I take those matters into account.

52It is to your credit that you have sought psychological treatment and it is unfortunate that it has been interrupted by these proceedings and an inevitable term of imprisonment. But it is a step in the right direction and it supports your counsel's submission that you have good prospects of rehabilitation.  You are a very able man. You clearly have a good brain. You have the skills and capacity to work hard and to be successful.  I have no doubt, particularly with the support of your family and the support of your friends, that you will come through this. I think that you are capable of putting all this behind you and leading an honest and productive life.

53It is much to your credit that you have made very significant community contributions.  You have been heavily involved with the Venezuela Association of Australia and have engaged in other community supports.  Your character references support the conclusion that you have good prospects of rehabilitation.  You will no doubt be able to draw upon their support when you complete your sentence.

54I take into account also your physical health issues: they will make your time in custody harder. 

55Your counsel rightly recognises, and clearly you have recognised from the word go, that a term of imprisonment is inevitable. He invites me to impose a sentence which promotes your rehabilitation to the extent I can, in particular by reflecting the prospect of an early release in a lower than usual non-parole period.

56The prosecution submitted that I should regard these offences as very serious examples of offending conduct. I was referred to the sentencing remarks of His Honour Judge David Sexton of this court in the Director of Public Prosecutions v Simmons [2024] VCC 665 at paragraph 19 where His Honour said in relation to a case less serious but not dissimilar from this: '… authorities have made clear, offences of this nature invariably represent serious criminality,' and there His Honour quoted the Director of Public Prosecutions v Bulfin [1998] VR 114, and Dyason v The Queen [2015] VSCA 120. Judge Sexton went on to say in his sentencing reasons:

'The offending often involves a carefully calculated course of conduct over a significant period of time, repeated deliberate acts of dishonesty and substantial amounts of money.  The offender often holds a position of responsibility or trust and has the ability to disguise or camouflage the conduct in question.  Detection can be very difficult.  The result of these considerations means that the sentencing purpose of general deterrence will usually carry particular significance, as will the need for a sentence which reflects strong denunciation by the sentencing court.'

57Other decisions in cases such as this have indicated that good character frequently does not play as significant a role as usual in the sentencing process because it is the nature of the offending that your good character has enabled you to become a certified public accountant and to obtain the degree of trust that was inherent in your position as chief financial officer of your victim company.  Nevertheless, it is clearly relevant, and I do take your good character into account in your favour. It goes very much to your prospects of rehabilitation and no doubt will assist in ensuring you have the kind of support you will need once you have completed your sentence.

58I was also provided with assistance by both counsel in relation to identifying current sentencing practice.  Each case requires separate consideration because none of the facts of other cases are exactly the same as the facts of another and personal circumstances vary significantly.  But doing the best I can to marry all of the sentencing considerations and accepting the characterisation of offending of this kind in the passage I read from His Honour Judge David Sexton's sentencing reasons, I sentence you as follows.

59On Charge 1 you are convicted and sentenced to imprisonment for two years.

60On Charge 2 you are convicted and sentenced to imprisonment for two years and six months.

61On Charge 3 you are convicted and sentenced to imprisonment for one year and nine months.

62On Charge 4 you are convicted and sentenced to imprisonment for one year and four months.

63On Charge 5 you are convicted and sentenced to imprisonment for 8 months.

64On Charge 6 you are convicted and sentenced to imprisonment for five months.

65I order that six months of the sentence on Charge 1 and four months of the sentence on Charge 3 be cumulated upon the sentence of two years and six months on Charge 2 and upon one another, making a total effective sentence of imprisonment for three years and four months.

66I fix a non-parole period of two years.

67But for your pleas of guilty, I would have sentenced you to imprisonment for five years with a non-parole period of three years.

68No other orders?

69COUNSEL:  No, Your Honour. 

‑ ‑ ‑