Director of Public Prosecutions v Hodge
[2012] VCC 1267
•31 August 2012
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
CRIMINAL DIVISION
Case No. CR-11-00070
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| MICHAEL HODGE |
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JUDGE: | HER HONOUR JUDGE HAMPEL | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 17, 21 August 2012 | |
DATE OF SENTENCE: | 31 August 2012 | |
CASE MAY BE CITED AS: | DPP v Hodge | |
MEDIUM NEUTRAL CITATION: | [2019] VCC 1267 | |
REASONS FOR SENTENCE
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Catchwords:
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APPEARANCES: | Counsel | Solicitors |
| For the Crown | Mr D. Hannan | OPP |
| For the Accused | Mr C. Dane QC | Darroll Nelson & Co. |
HER HONOUR:
1 Over a period of three and a half years, you, Michael Hodge, repeatedly forged the signatures of your parents on loan documents. You also forged the signatures of attesting witnesses to their signatures. You provided the false documents to various financial institutions. On five separate occasions, accepting them as genuine, financial institutions advanced moneys to you secured by your parents family home.
2 Twice, during that period, your parents were faced with Supreme Court proceedings for possession of their home. On the first occasion, you produced forged letters which you gave to your parents and the solicitor that they had retained to advise them. They purported to be from the Commonwealth Bank of Australia and falsely asserted that you, and they were indemnified against any loss, as their home had been secured against a loan advanced to you as part of an internal investigation into detection of fraudulent loan transactions.
3 Before these letters were exposed for the fraud they were, you paid out the CBA loan with another one, obtained by the same fraudulent method of forging your parents signatures and those of attesting witnesses, so securing the advance of further moneys to you by another lending institution, secured again by pledging their home without their knowledge or consent.
4 During that same period, you presented cheques made out to cash which you had taken from your parents cheque book. You used subterfuge to conceal from your parents the taking and the cashing of the cheques. You set up a process where the bank, had it telephoned your parents and sought confirmation from them that the cheques were to be honoured, would have had its call diverted to somebody who would falsely provide that reassurance.
5 You have now pleaded guilty to five charges of obtaining a financial advantage by deception, five of making a false document and 14 of obtaining property by deception.
6 The five obtaining a financial advantage by deception charges relate to the five separate occasions where you presented documents containing the forged signatures of your parents and attesting witnesses to the financial institutions who, in reliance on those forged documents, advanced loan moneys to you.
7 They are Charge 1, the first fraudulently induced advance of $100,000 from the National Australia Bank in April 2004.
8 Charge 2, the second fraudulently induced advance from the National Australia Bank of $125,000 in September 2004.
9 Charge 3, the third fraudulently induced advance from the National Australia Bank of $125,000 in January 2005.
10 Charge 6, the fraudulently induced advance from the Commonwealth Bank of Australia of $123,400 in October 2005; and
11 Charge 20, the fraudulently induced advance from Australian Securities Limited of $119,100 in October 2007.
12 The 14 obtaining property by deception charges, Charges 5, and 7 to 19 inclusive relate to the 14 separate occasions you obtained money from your parents' cheque account, using the cheques that you had razor cut out of their cheque book.
13 The first of the make false document charges, Charge 4, concerned a forged surrender of deeds, purportedly signed by your parents, which was provided to the National Australia Bank at about the time you paid out the NAB loan and took out the CBA loan.
14 The other four make false document charges, Charges 21 to 24 inclusive, relate to the four forged documents you gave Bill Clancy, the solicitor your parents consulted in the course of the foreclosure proceedings and which falsely represented you were working for the CBA to uncover fraudulent loans.
15 The total amount of money obtained by this fraudulent activity was $711,600. Of that, $592,500 was the net total from the five bank loans. The balance of $138,300 was obtained from the cheque account,
16 The five obtaining a financial advantage by deception charges are continuing criminal enterprise offences and so carry a maximum of 20 years' imprisonment, double that applicable to obtaining a financial advantage by deception offences, which are not continuing criminal enterprise offences.
17 The obtaining property by deception and make false document charges each carry a maximum of ten years' imprisonment.
18
Not surprisingly, given this history that I have recounted of the loans, you also defaulted on the Australian Securities Limited loan. Australian Securities Limited too, took recovery proceedings. By the time you defaulted on the ASL loan, your father was in hospital, terminally ill. I was told by your counsel,
Mr Dane, that a bedside hearing, with 12 barristers representing various lending institutions present, was convened to take evidence from him. At that time you were still maintaining the story that the loan was indemnified because you were working for the CBA investigating fraud.
19 Eventually the parties resolved that litigation, with your two siblings paying out the lenders, so freeing your parents home from risk of possession. I was told that your father died, knowing that was the way the litigation had been resolved, but before final settlement had occurred. Your mother survived your father by two years, and was able, through the actions of your siblings, to remain in her home until her death. After that, the balance of your parents' estate was divided between your two siblings.
20 Both parents, therefore, knew before they died, that the reason they had twice faced possession proceedings for their home, was because you had pledged their house to secure loans for yourself without their knowledge or consent, and that their ability to remain in the house was secured by the actions of their two other children.
21 It took some time for the frauds to be detected and investigated. Mr Clancy, the suspicious solicitor, to whom you had provided the forged CBA letters, had first referred the matter to the police in February 2008. You volunteered to be interviewed, and presented yourself for that purpose in April 2008. When interviewed, you admitted forging the signatures on the loan documents, and stealing and cashing the cheques. However, you told an elaborate, and now admittedly false story, asserting you had been the unwitting victim of a scam, perpetrated by a person you named as Bill Woods, somebody you could name and describe but not locate. You went so far as to assist the police in creating a fictitious picture or FACE image of this fictional Bill Woods. A considerable investigative effort went into investigating the Bill Woods story.
22 You were not charged until June 2010, just over two years after you had been interviewed.
23 After a contested committal, in January 2011, in which the Bill Woods story was still pursued, the matter was set down for trial in this court, for February 2012. It was in the month before the trial was due to commence that plea negotiations commenced, and resulted in the entry of guilty pleas in February this year. The delay since then had been occasioned by the time taken to obtain your medical records.
24 These offences are, as Mr Dane acknowledged at the start of his plea, serious dishonesty offences involving significant breach of trust. I would add a significant breach of the trust expect of an adult child to his parents. It was deliberate planned and sustained. It involved a number of different methods by which your parents, financial institutions, legal advisers and police were lied to and deceived.
25 That your parents were not evicted and the house was not seized and sold, to satisfy your debt to the ultimate lender, is due to no effort or attempt to make good on your part. It was fortunate for your parents that your siblings had the means, and the consideration for them, to pay out the lender and to ensure that their parents could live in the house until their death.
26 I do not consider it any evidence of remorse that you did not challenge your parents' decision to change their wills, leaving the balance of their estate to be divided between your siblings.
27 It is clear that considerations of denunciation, deterrence and just punishment must carry considerable weight here. Defrauding, taking advantage of elderly, vulnerable parents, putting them in a position where they face being evicted from their home, being deprived of the security they had built for themselves to see them through their retirement, is despicable, inexcusable conduct. Your conduct is the more deserving of condemnation because, it would appear from what I was told, your parents had supported you financially and given you money to assist you in various ventures throughout your adult life.
28 Mr Dane relied on the following matters to weigh against these considerations:
· Your background and family circumstances relevant to placing the offending in context.
· Your long history of untreated schizophrenia and other mental health considerations.
· Your absence of relevant convictions.
· Delay.
· Your guilty plea.
· Your current circumstances and prospects for rehabilitation.
29 Dealing with those in turn.
30 You are now 48, and the youngest of three siblings. Your father was a general practitioner, your mother a nurse, and the family was comfortably off.
31 You have two highly successful siblings, and have always felt the burden of failing to live up to their achievements and your parents' expectations. You were asked to leave the private school, on the council of which your father served, and of which your brother had been captain. This, in the circles in which your family moved, was a matter of shame, and Mr Dane said, you were marked by it thereafter. In an attempt to match your siblings academic and professional achievements, you developed what he described as grandiose business schemes. It would appear that your parents would advance you money to support these ventures, which invariably failed, and so perpetuated your sense of failure.
32 That cycle of grandiose plans, parental funding and business failure was in part fuelled by, and in part compounded, Mr Dane submitted, by your chronic untreated schizophrenia. That was diagnosed when you were young.
33 Dr Grech, the psychologist, whose report was provided to me, reported that he had accessed reports written by the clinical psychologist, Ilona Zagon, in the mid 90’s and by Professor Kegs, who I think is a psychiatrist, not a psychologist, in 1996. Ms Zagon had noted that you had suffered psychosis since late adolescence. Professor Kegs assessed you on four occasions in 1996 and assessed you as suffering from schizophrenia. He noted the confounding effects of cannabis and other illicit drugs on that diagnosis.
34 You have, throughout your life, declined treatment for the schizophrenia. Your parents supported you in your refusal of treatment. This is, as Mr Dane said, surprising, given that your father was a general practitioner and your mother was a nurse. They and must have been aware of the importance of treatment. Mr Dane said that you perceived that your parents were ashamed of your having a mental illness, and that that may have influenced their thinking in supporting you in declining treatment and then in backing your grandiose ventures.
35 Whether your perception is correct or not, it is important to put this in perspective. You were a mature adult, 41 when the offending commenced. It has not been suggested that there is any causal connection between the schizophrenia and the offending. Mr Dane expressly disavowed reliance on any of the Verdins principles. He made it clear he was relying on your schizophrenia as relevant only to your background history and the surrounding circumstances.
36 At the time you created the first forged documents and obtained the first loan, the subject of Charge 1, you were already the beneficiary of a $125,000 loan from the National Australia Bank, secured by your parents' home. It would appear the door had not been closed to parental loans, or parental support for loans to you to support business ventures.
37 It appears from what you told Dr Grech and Mr Dane, that the money or much of the money that you obtained as a result of these offences was not put to supporting any business ventures, but rather went towards funding a lifestyle which revolved around substance abuse and gambling.
38 I do not consider the disappointment of not finishing at the family school of choice, of not of measuring up tho the achievements of high achieving siblings has any relevance to, or mitigating effect on the behaviour for which I must sentence you.
39 It is no more than greedy selfish dishonesty.
40 In his report, Dr Grech referred to your current mood as low and flat, with themes of hopelessness and helplessness, loss of interest and pleasure, reduced concentration and attention, early wakening, disturbed sleep, fatigue, lack of motivation, excessive worry and a fear of being imprisoned and separated from your young family. Apart from the fear of imprisonment and separation from your family, matters that almost inevitably followed from people pleading guilty to serious charges, none of that description of mood was supported by, and in fact was contradicted by the evidence of your wife. This demonstrates the limited usefulness of those parts of the mini mental state examinations employed by Dr Grech, and on which he based those findings. Those tests are designed to give a snapshot of a person's mental state at the time of examination. They are not designed to be used for, or intended to be used for long term diagnosis or prediction. Dr Grech also referred to your GP's attempts to engage you with mental health services through a better mental health plan, and your continued refusal to engage.
41 There is nothing in this other material which would bring any Verdins principles into play.
42 You have been before courts on two occasions in 1982 and 1999 for relatively minor matters, not involving dishonesty. You were also before a court in July 2007, making that appearance a prior appearance for Charges 16 to 24 inclusive. Again, it was for a relatively minor matter not involving dishonesty. On none of those occasions was a conviction recorded against you.
43 Apart from indicating you do not come before the court as a first offender, they are of no relevance to sentencing here.
44 There has been considerable delay between the commission of the offences and sentencing today. Much of that is due to the nature of the offending, the difficulty of its detection, the fact that such offences are usually only detected if something goes wrong, such as a loan being defaulted upon, and the steps that you took during and afterwards to conceal your role and tell patently untrue stories. The delay between charge and sentencing is as a result of the late entry of your guilty plea.
45 It is a long time to have matters unresolved, but it is hard to avoid the conclusion your conduct, until you pleaded guilty, was more consistent with taking steps to avoid detection and being held accountable than indicative of any suffering of the oppressive certainty that you would ultimately be detected and found guilty.
46 In those circumstances I do not consider that the delay should be treated as an added burden which should mitigate the sentence otherwise appropriate.
47 You pleaded guilty, and you are entitled to the benefit for that. It clearly has significant utilitarian benefit. It has saved the cost and time of trial. I accept a trial would have been a lengthy trial had you maintained your Bill Woods story and put the prosecution to proof, and that proof would have been more technical and protracted as both your parents are now dead. There is no evidence before me you have any remorse for your behaviour, and in the circumstances, although I give weight to your guilty plea for those matters I have already identified, I do not take the guilty pleas as evidence of remorse, and so, deserving of a greater reduction in sentence. I want to make it clear, that the absence of remorse is not an aggravating feature, but rather I am treating it only as the absence of an additional mitigating feature.
48 Turning then matters relied upon on as pointing to rehabilitation already under way and therefore to evaluating your prospects generally, there is some, although I must say somewhat limited evidence, that you were at the time of the offending abusing drugs and alcohol and gambling. Clearly any abuse of drugs and alcohol was not to such a level that you were unable to carry out the detailed and sophisticated steps necessary to allow these frauds to be committed and the lies to be told and perpetuated.
49 I am told that you have significantly reduced your alcohol intake and cut out illicit drugs.
50 Although you are estranged from your siblings, you have, since the matters have come to light, achieved what would appear to be a greater stability in your personal life than you have ever had. You are now married and you have fathered a child. You live a modest life in Bacchus Marsh with your wife, her three sons from a previous relationship, and the daughter born of the union between the two of you.
51 You have been in steady employment selling educational products.
52 It is, as Mr Dane suggested, a far cry from the private school, tertiary educated, high achieving professional and business milieu in which you grew up.
53 He submits that your rehabilitation is well under way, and that the opportunity for offending in like manner is unlikely to present itself.
54 I accept all those matters, but note also, relevant to the assessment of your prospects for rehabilitation and the weight to be given to specific deterrence, the fact that you have exhibited no remorse; that you, it would appear, did not apologise to your parents or accept responsibility to them. Indeed you maintained your lie until after both of them had died; and that your estrangement from your siblings would appear to be at least in part because you have not acknowledged responsibility to them or apologised to them, indicates that you display no insight into your offending. Therefore, although I think your prospects for rehabilitation should be generally regarded as good, they must be tempered by that absence of insight and the sentence must reflect some weight to be given to specific deterrence as well as to general deterrence.
55 Mr Dane submitted that I should not interfere with the new life that you have made for yourself and that I should impose a fully suspended sentence. I do not agree with that. In my view, no sentence other than one of imprisonment, immediately served, is appropriate to mark denunciation, just punishment and general deterrence.
56 Michael Hodge, on the 24 charges to which you have pleaded guilty, you are convicted:
57 On Charge 1, obtaining a financial advantage by deception, that relates to the first NAB advance of $100,000, you are sentenced to be imprisoned for a period of 18 months, and I make that the base sentence.
58 On Charge 2, obtaining a financial advantage by deception, the second NAB advance, you are sentenced to be imprisoned for a period of 18 months.
59 On Charge 3, obtaining a financial advantage by deception, the third NAB advance, you are sentenced to be imprisoned for a period of 18 months.
60 On Charge 4, make false document, the false NAB letter of instruction surrendering the deeds, you are sentenced to be imprisoned for a period of six months.
61 On Charge 5, the first obtaining property by deception, relating to the first cheque taken from your parents' bank account, for the amount of $12,000, you are sentenced to be imprisoned for a period of six months. I direct that the whole of that be served cumulatively upon the sentence on Charge 1 and the other cumulation order I will shortly make.
62 On Charge 6, obtaining a financial advantage by deception, relating to the CBA advance of $123,400, you are sentenced to be imprisoned for a period of 18 months.
63 On Charge 7, obtaining property by deception, the second cheque of $13,000, you are sentenced to be imprisoned for a period of six months.
64 On Charge 8, obtaining property by deception, the third cheque for $15,000, you are sentenced to be imprisoned for a period of six months.
65 On Charge 9, obtaining property by deception, the fourth cheque for $13,000, you are sentenced to be imprisoned for six months.
66 On Charge 10, obtaining property by deception, the fifth cheque for $12,000, you are sentenced to be imprisoned for six months.
67 On Charge 11, obtaining property by deception, the sixth cheque for $8,800, you are sentenced to be imprisoned for six months.
68 On Charge 12, obtaining property by deception, the seventh cheque for $9,700, you are sentenced to be imprisoned for six months.
69 On Charge 13, obtaining property by deception, the eighth cheque for $7,500, you are sentenced to be imprisoned for six months.
70 On Charge 14, obtaining property by deception, the ninth cheque for $7,500, you are sentenced to be imprisoned for six months.
71 On Charge 15, obtaining property by deception, the tenth cheque for $7,300, you are sentenced to be imprisoned for six months.
72 On Charge 16, obtaining property by deception, the eleventh cheque for $5,700, you are sentenced to be imprisoned for six months.
73 On Charge 17, obtaining property by deception, the twelfth cheque for $8,000, you are sentenced to be imprisoned for six months.
74 On Charge 18, obtaining property by deception, the thirteenth cheque for $9,300, you are sentenced to be imprisoned for six months.
75 On Charge 19, obtaining property by deception, the fourteenth cheque for $9,000, you are sentenced to be imprisoned for six months.
76 On Charge 20, the final charge of obtaining financial advantage by deception, in relation to the ASL advance, of $119,100, you are sentenced to be imprisoned for six months.
77 On Charge 21, make false document, the first of the false letters relating to the CBA, provided to Mr Clancy, you are sentenced to be imprisoned for a period of six months, and I direct that the whole of that be served cumulatively on the sentence on Charge 1 and Charge 5.
78 On Charge 22, the second Clancy false letter, you are sentenced to be imprisoned for a period of six months.
79 On Charge 23, the third false Clancy letter, you are sentenced to be imprisoned for six months.
80 On Charge 24, the fourth false Clancy letter, you are sentenced to be imprisoned for a period of six months.
81 That makes a total effect sentence of two years and six months, and I fix a period of one year and six months as the time that you must serve before being eligible for parole.
82 I declare, pursuant to s.6AAA of the Sentencing Act, that but for your pleas of guilty, I would have sentenced you to a period of two years' imprisonment on each of Charges 1, 2, 3, 6 and 20 and to eight months' imprisonment on each of the other charges. With cumulation orders following the same pattern, I would have arrived at a total effective sentence of three years and six months and I would have fixed a period of two years and six months as the period you had to serve before being eligible for parole.
83 I declare that in respect of Charges 1, 2, 3, 6 and 20, that they are continuing criminal enterprise offences and that you have been sentenced in respect of them as a continuing criminal enterprise offender.
84 Are there any ancillary orders?
85 MR HANNAN: No Your Honour.
86 HER HONOUR: There is no pre-sentence detention?
87 MR HANNAN: No.
88 HER HONOUR: No further orders? Is the arithmetic correct?
89 MR HANNAN: Yes. Yes, Your Honour, from what you have announced.
90 HER HONOUR: Thank you. No pre-sentence detention. Thank you. Could you remove Mr Hodge please.
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