Director of Public Prosecutions v Ibegbu

[2019] VCC 1419

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

AT MELBOURNE
CRIMINAL JURISDICTION

CR 18-00905

DIRECTOR OF PUBLIC PROSECUTIONS

v

CHUKWUKA IBEGBU

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JUDGE:	HIS HONOUR JUDGE MEREDITH
WHERE HELD:	Melbourne
DATE OF HEARING:	26 August 2019
DATE OF SENTENCE:	29 August 2019
CASE MAY BE CITED AS:	DPP v Ibegbu
MEDIUM NEUTRAL CITATION:	[2019] VCC 1419

REASONS FOR SENTENCE
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Subject:  CRIMINAL LAW

Catchwords:  15 charges of obtain financial advantage by deception and 2 attempts – continuing criminal enterprise offender on some charges – quantum $522,000 – loss $346,000 – sophisticated offending

Legislation Cited:     Crimes Act 1958; Sentencing Act 1991
Sentence:                  TEFS 3 years 7 months, NPP 2 years 3 months

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APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Mr M. Regan	Office of Public Prosecutions
For the Accused	Mr J. Berreiro (For Sentence) Mr S. Tovey (For Plea)	Pica Criminal Lawyers

HIS HONOUR:

1Mr Ibegbu, you have pleaded guilty to 15 charges of obtaining a financial advantage by deception and two charges of attempting the same.  The respective maximum penalties for these offences are 10 years' imprisonment for the completed offence and five years' imprisonment for the attempt.

2Tendered on the hearing of your plea was an extensive prosecution summary.  This recites in great detail various aspects of the circumstantial evidence which connects you to various of the offences.  Having regard to the fact that this document will remain on the court file, for the purposes of these sentencing reasons, I will not descend to this level of detail.

3In summary, the 15 charges of obtaining a financial advantage by deception are composed of Charges 1 through to 12, and 14 through to 16, which occurred between August 2016 and October 2017.  The two charges of attempting to obtain a financial advantage by deception are Charges 13 and 17 and took place in September to October 2017.

4The completed offences relate to $463,765.42.  The attempts relate to $59,073.85.  This makes a combined total of $522,839.27.  The total loss as a result of your offending is, however, less, namely $346,000.  In regard to Charges 7, 8, 10, 16 and 17 the transfer of funds or the withdrawal of same was stopped by the intervention of a banking institution and these various interventions total $140,682.49.

5You are a Nigerian citizen who has been in Australia continuously since December 2015 on a student visa.  That was valid until the early part of this year.  At the time of your arrest in October 2017 you were living alone in Mill Park.  Your offending came to light as a result of a series of notifications to authorities.  That concerned irregular banking activity.  Your offending broadly followed the same method.  A number of businesses had had their computer systems unlawfully accessed.  After this occurred they received a number of invoices purporting to be from suppliers whose bank account details had been altered.  When payment was attended to on these invoices the funds were diverted to the nominated bank accounts which had either been set up or were operated by you.  When funds were paid into these accounts they were variously disbursed either to other accounts or the subject of withdrawals.

6CCTV associated with various banks indicates that you are implicated in the withdrawals of funds on at least four of the charges.  CCTV shows you on three occasions making withdrawals in regard to Charge 5.  In regard to Charge 12 you attended the relevant financial institution on three occasions, two of which were unsuccessful in the withdrawal of funds.  In regard to Charge 14 you made a withdrawal and also in regard to Charge 15.

7The evidence does not reveal the party who gained access to the various computer systems of your victims and their email accounts or, for that matter, the person or persons who created the fraudulent invoices with the substituted banking details.  The prosecution do not contend that I ought sentence you on the basis that you are responsible for the hacking of the various systems.  The prosecution are of the view that it is unlikely that you were acting alone in these offences. You fall to be sentenced on the basis that you have been implicated in the creation and/or operation of a number of fraudulent bank accounts as well as the rapid disbursal of funds out of a number of these accounts.  So far as can be ascertained your principal role was to create accounts or access them and once moneys had been transferred into these accounts you would facilitate rapid access to the funds by either cash withdrawals or transfers to other accounts within the web of accounts within your control.

8On 17 October 2017 police searched your residence in Mill Park and located a variety of items which linked you to various aspects of the offending.  Dealing briefly then with each of the charges to which you have pleaded guilty,
Charge 1 concerns the Horsham Arts Council on 24 August 2016, paying $600 into a Commonwealth Bank account.  This was in response to an altered invoice which had fraudulently altered bank deposit details included within it.  The $600 that was transferred was withdrawn from that account and remains unrecovered.

9Charge 2 concerns the next day, 25 August, when the Horsham College paid $2400 into a Commonwealth bank account on an altered invoice.  Of the $2400 paid 2000 was withdrawn whilst the remaining $400 was recovered.

10Charge 3 concerns the Grist Group from Western Australia.  In October 2016 their computer and email system was unlawfully accessed and compromised.  On 7 October 2016 the Grist Group paid $28,500 in response to a fraudulently amended invoice.  These funds were rapidly transferred out of the fraudulent account in a variety of ways.  These are detailed in the prosecution summary.  Of the 28,500 deposited, $18,146 was transferred out or withdrawn.  $10,352.60 was returned to a financial institution which left the Grist Group $4005.20 out of pocket.

11Charge 4 involved a New South Wales business, namely Robert Plumb Project Pty Ltd.  They had had their emails accessed in December 2016.  A total of $40,765.89 was paid in response to a fraudulently altered invoice in two instalments.  One of $27,885.52 and another of $12,880.37.  None of these funds have been recovered.

12Charge 5 concerned a business, Reeves International, which in February 2017 had had their computer system and email accounts unlawfully accessed.  It was subsequently discovered that $35,229.10 had been paid as a result of a fraudulent invoice.  On 28 February 2017 you attended a Travelex agency at Melbourne Airport and withdrew $13,795.55 from this account.  You are observed on CCTV footage with an unknown male at the time of this transaction.  On the same day you further withdrew $1000 from an ATM.  Again on the same day in the Melbourne CBD area you withdrew a further $16,666.67 at a Travel Money Oz office.  None of the 35,229.10 paid by Reeves International has been recovered.

13Charge 6 concerns a business called Scorpio Screens & Blinds in Queensland, which also had their computer system accessed.  Consequent upon a fraudulent email, two invoices in the sum of $44,111.78, and a second one in the sum of $44,111. 78, thus making a total of $99,223.56 was paid out.  None of this money has been recovered.

14Charge 7 concerns a business called New Line Architecture in Western Australia.  Again this business had been unlawfully accessed and consequent upon its computer system having been accessed, a fraudulent email was sent from the business to a client requesting the client pay an invoice in the sum of $14,500 which had fraudulent banking details attached.  $14,500 was duly paid.  However, a stop was put on this and no moneys withdrawn.

15Charge 8 involves a business called Acquire Com in Brighton, Victoria.  In
May 2017 its computer system had been unlawfully accessed.  Emails were then received from a client of the business requesting payment of a fraudulent invoice in the sum of $5357.24.  This was duly actioned to the fraudulent account.  However, it was stopped by the payee's bank.  No money was able to be withdrawn.

16Charge 9 involves a business by the name of Simmons Homes having had their computer system unlawfully accessed, as well as a compromise of their email system.  A legitimate invoice to the company had been raised.  However, fraudulent banking details were inserted into it and the sum of $35,556.63 duly paid.  None of this was recovered.

17Charge 10 concerns the compromise of the computer system and then forwarding of a genuine invoice to a client of that business, namely Crouch Concreting in Queensland.  A fraudulent follow-up email was then sent a matter of days later requesting payment of the invoice but advising payment details had been changed and the details of a fraudulent account then being provided.  A total of $10,169.50 was paid by Crouch Concreting in three transfers into the nominated fraudulent account over the period of a week.  A stop was, however, put on this and none of the moneys were able to be accessed and/or withdrawn.

18Charge 11 concerned again the compromise of a computer system of a business known as Benski Pty Ltd.  Several fraudulent emails were then sent to the operator of the business's National Australia Bank manager requesting the payment of $40,000 to be transferred into a fraudulent account.  On 23 June 2017 the NAB Bendigo duly transferred $40,000 to the account.  This money was lost as the money was withdrawn.

19Charge 12 involved the unlawful access of the computer system of Silverleaf Construction in New South Wales.  Fraudulent emails were then sent purporting to be from Silverleaf Construction to a client of theirs, a Mr Flores.  These requested the payment of an actual outstanding invoice in the sum of $81,000.  The banking details of the invoice were changed and Mr Flores, however, was tricked into paying $81,000 into the fraudulent account.  These funds were completely lost to the victim.  +You participated in withdrawals by attending at an ANZ Bank branch in Mill Park and on two occasions at an Epping Plaza branch.

20Charge 13 of attempting to obtain financial advantage by deception concerned a payment on 18 September 2017 by a company known as McKay, and with Whitsunday Roofing to one of its subcontractors.  The invoice had inserted into it fraudulent banking details.  The invoice, however, was paid to the proper bank account, which was familiar from the previous transactions.  The attempt was in the sum of $2841.85.

21Charge 14 concerns a genuine invoice which had been sent to a customer of MacKay in Whitsunday Roofing in the sum of $10,595.75.  The banking details had been fraudulently changed and the customer having been deceived by this, paid the full amount of the invoice in the sum of $10,595.75 in three instalments, namely 5000 and 2000 and $3595.75.  You were captured on CCTV footage making withdrawals from the relevant account.  The $10,595.75 was lost and the money not recovered.

22Charge 15 concerns another customer of McKay and Whitsunday Roofing who received a follow-up email in regard to an existing account, which provided details of a fraudulent bank account.  This was actioned and funds in the sum of $5434 were paid into the specified account.  You are captured on CCTV footage withdrawing 1000 from this account at a shopping centre in Plenty Valley.  Police recovered these funds and the transferee has been reimbursed the sum of $5434 by the relevant banking institution.

23Charge 16 concerns the unlawful accessing of the computer of a Mr Jitendra Negi.  At the time he was developing a property in South Australia and he had requested his mortgage agent, known as Mortgage 123, to make a payment out of his mortgage account of $54,423.75 to his builder, Distinctive Homes at Richmond in South Australia.  Unbeknown to Mr Negi fraudulent emails were sent to Mortgage 123 and a fraudulent bank account provided for the payment in question, which was made on 17 October 2017.  A stop was placed on this and the funds were not able to be accessed and recovered.

24Finally, Charge 17, of attempting to obtain financial advantage by deception, again involved the unlawful accessing of the computer system of Mr Joseph Edgar, who operated an electrics business in Camberwell.  A customer of
Mr Edgar's business received a fraudulent email having an amended invoice attached with fraudulent banking details specified.  Consequently the sum of $56,232 was paid to the specified account.  This occurred on the day that your premises were searched and the transaction was stopped and the funds recovered and restored.

25Tendered on the plea hearing was one victim impact statement from Ms Glenis Wood, the director of Scorpio Screens & Blinds, who are the subject of
Charge 6.  In her statement Ms Wood speaks of her shock and concern and the fact that the business had to rely on an overdraft facility consequent upon the payment of the $90,000-odd.  She speaks of her loss of confidence and the stress and anxiety which this offending has occasioned.  I will have appropriate regard to the content of her victim impact statement.

26Part 2B of the Sentencing Act applies when the court sentences a continuing criminal enterprise offender for a continuing criminal enterprise offence.  Continuing criminal enterprise offences are defined in Schedule 1A of that legislation and include an offence against s.82(1) of the Crimes Act, namely obtaining a financial advantage by deception, where the value of the advantage obtained is $50,000 or more.  Section 6H(1) defines continuing criminal enterprise offender as meaning an offender who is found guilty of three or more continuing criminal enterprise offences.  As a result of your conviction on charges 6, 12 and 16, you fall to be sentenced as a continuing criminal enterprise offender on these charges.

27I note that Charge 6 is a rolled up transaction.  However, the second aspect of this transaction exceeds $50,000 and accordingly can act as a trigger for the continuing criminal enterprise offender legislation.  The effect of this legislation is that it elevates the maximum term of imprisonment for these offences to double what it otherwise would be, namely 20 years' imprisonment.  This does not mean that I must automatically impose a higher sentence on you on those charges.  Rather, it is a guide to the seriousness of those offences and it needs to be taken into account along with other factors in arriving at a proper sentence on those charges.

28So far as your offending is concerned I will have regard to the fact that the criminal enterprise offences occurred as part of a continuum of protracted, sophisticated and fairly devious offending in which you have played a vital role. I must also have regard to the quantum involved in each of them. By the time of Charge 16 having occurred you had been actively offending in this fashion for many months. In addition, given that you are to be sentenced as a continuing criminal enterprise offender for a continuing criminal enterprise offence, I am required by s.6J of the Sentencing Act to have entered into the records of the court the fact that I have sentenced you as a continuing criminal enterprise offender for a continuing criminal enterprise offence.

29Turning now to your personal circumstances, you are currently 33 years of age without prior conviction.  You immigrated to this country in 2015 to further your studies.  You were born in Lagos, Nigeria and are the youngest of six.  Your parents separated when you were approximately 11 and you and the other children moved to the countryside with your mother.  You later returned to live with your father and you are the only one of your siblings to finish school.

30Your home life was marred by domestic violence and your father drank to excess.  To your credit you overcame these obstacles and graduated from high school in 2004 with high marks.  You then spent the next few years working with your brothers in your father's car wrecking business and commenced university in 2008 where you completed a Bachelor of Arts, majoring in philosophy.  You then spent the year following the completion of your studies working in the Nigerian National Youth Service and spent most of this teaching under privileged children in a school.  You then applied to, and were accepted, at Deakin University where you were enrolled in a Masters of Information Technology.

31You then came to Australia under a student visa, arriving in December 2015.  Soon after you changed your course to a Bachelor of Nursing at RMIT University and at the time of your remand into custody you had completed all but five units of this degree.  You instruct that you developed a gambling problem and through your social isolation and spending time at the Melbourne Casino, were introduced into this scheme.  You have instructed that as your gambling escalated to more problematic levels your role in the scheme became more active and that you were paid a percentage of the funds obtained.

32To your credit, you have pleaded guilty and whilst this is not at the earliest stage this is to be viewed in the context of yours having been a fairly complex matter and the forensic reality of your position.  In a case such as this it is reasonable to expect some time to be taken for settlement negotiations to resolve the matter acceptably.  Having regard to this I am of the view that the utilitarian benefit of your plea is reasonably significant and also evidences a degree of remorse on your part.

33Since coming to this country, as I have said, you have gone a long way toward obtaining a nursing qualification.  In this regard reference material relating to the clinical placements which you undertook speaks very highly of you.  Notwithstanding the fact that your student visa has now expired, you have instituted an ongoing process whereby you seek to remain in this country.  I cannot find as a fact that you will be deported as a result of your offending.  However, I do take into account the state of uncertainty and suspense that you are left in and the fact that your period of imprisonment is made more difficult by the prospect that the future which you had planned in this country will no longer be open to you.  In this regard I also note the reference from your girlfriend, Ms Ramona Sucic, and the fact that she speaks of wishing for both of you to have a life together.

34You have been assessed by Ms Miriam Latif, psychologist, and on your report she diagnoses you with a severe and persisting gambling disorder which is currently in partial remission.  You told her that you would regularly bet on horse races, play the roulette table at the casino, as well as purchasing lots of Tattslotto tickets.  Whilst a motive for your offending may relate in part to your gambling and in that sense it distinguishes your offending from a case where the motive can be described as pure greed or a desire to fund some other form of criminal activity, your gambling is, however, of little mitigatory value and has little impact on the need to appropriately emphasise general deterrence and the court's denunciation of this type of offending.

35Ms Latif has further diagnosed you with post-traumatic stress disorder and she relates this to aspects of your background.  She states that your symptoms have laid dormant and that you are unlikely to have been actively experiencing PTSD symptoms during the time that you were in Australia and during the time of your offending.  She states, however, that since your remand you have started experiencing nightmares and flashbacks.  However, that you have avoided medication for your PTSD.  She further states that should you be witness or victim of any trauma whilst in custody, that an increase in your experience of PTSD is likely.  Whilst I will have some regard to the existence of your PTSD and the symptoms which Ms Latif describes, in the circumstances here it can only lead to a modest reduction of the sentence on the basis that the burden of your imprisonment is increased.

36Ms Latif has also diagnosed you with an adjustment disorder with mixed anxiety and depression consequent upon your present legal predicament.  Again I note you are not medicated in relation to this.  However, I will have appropriate regard to this in the sense that it may add to the burden of your imprisonment.

37Having regard to the lack of any previous convictions of you, your obvious intelligence, and the positive manner in which you have approached your nursing studies, I am of the view that your rehabilitative prospects are sound.  In regard to your gambling I note that you have sought the assistance of
Ms Creasley, therapeutic counsellor, and provided you appropriately address this issue, your prospects of rehabilitation, as I have said, appear to me to be sound.

38Whilst I do not sentence you as the architect of the scheme or the person who hacked into the various computer and email accounts, you nonetheless played an important role in what was, on any view, a sophisticated and ongoing fraudulent scheme. Your opening of the various bank accounts of itself demonstrates a relative level of sophistication. In offending such as this general deterrence and just punishment must feature in the sentences which I impose. Also having regard to the fact that by the time of the third continuing criminal enterprise offence was committed, I am satisfied that you did so in the expectation of continued participation and reward and there is in the circumstances of this case a need to view the last of the continuing criminal enterprise offences, in my view, as a more serious example of offending having regard to Part 2B of the Sentencing Act.

39I am going to announce the sentences shortly but because of the number of counts and the differing quantums, I will hand out to each of you a table which sets out the respective sentences and I would ask you please to follow them and just check that there may not be any arithmetic difficulty.

40MR REGAN:  May it please the court.

41HIS HONOUR:  Thanks.

42MR REGAN:  Very grateful, Your Honour.

43HIS HONOUR:  That is all right.  All right, sir, would you stand, please:  so on Charge 1 I am going to sentence you to one months' imprisonment; on Charge 2, two months; Charge 3, four months; Charge 4, seven months; Charge 5, six months; Charge 6, 14 months; Charge 7, three months; Charge 8, three months; Charge 11, seven months; Charge 9, six months; Charge 10, three months; Charge 12, 12 months; Charge 13, one month; Charge 14, three months; Charge 15, three months; Charge 16, 12 months; Charge 17, five months.

44I am going to direct that the sentence I have imposed on Charge 6 of 14 months is to be the base sentence and I will cumulate on it and on each other the following terms of imprisonment:  one month of Charge 2; two months of
Charge 3; three months of Charge 4; two months of Charge 5; one month of Charge 7; one month of Charge 8; three months of Charge 11; two months of Charge 9; six weeks of Charge 10; four months of Charge 12; six weeks of Charge 14; one month of Charge 15; four months of Charge 16; and two months of Charge 17.

45That makes a total, on my calculations, of three years and seven months' imprisonment, and I propose to fix a non-parole period of two years and three months.

46Pre-sentence detention I understand is at 732.

47MR REGAN:  No, Your Honour.  It was 678 as of midnight Sunday.

48HIS HONOUR:  All right.  So what is it today?

49MR REGAN:  And that makes plus three, so 681 by my calculation.

50HIS HONOUR:  All right.  Do you agree with that?

51MR BARREIRO:  Yes, Your Honour.

52HIS HONOUR:  All right, 681.  Just have a seat for now, sir.  All right, I'll continue.  Now, I am required to state the sentence that I would have imposed on you but for your plea of guilty.  Doing the best I can I will indicate that I would have imposed a total effective sentence of four years and six months and directed that you not be eligible for parole for three years and three months.

53I will make the ancillary orders.  The compensation orders I will make this afternoon in chambers.

54MR REGAN:  Yes, Your Honour.

55HIS HONOUR:  One of the ancillary orders relates to the taking of a DNA sample and I am required to inform you that if you decline to provide the sample, reasonable force can be used to obtain it from you.  All right, anything further?

56COUNSEL:  No, Your Honour.

57HIS HONOUR:  All right, thanks.  All right, if Mr Ibegbu could be returned to custody, thanks.  All right, thank you, both.

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