Director of Public Prosecutions v Johnson
[2015] VCC 1209
•4 September 2015
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
CRIMINAL DIVISION
Case No. CR-15-01017
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| GARY JOHNSON |
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JUDGE: | HER HONOUR JUDGE LAWSON | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 2 September 2015 | |
DATE OF SENTENCE: | 4 September 2015 | |
CASE MAY BE CITED AS: | DPP v Johnson | |
MEDIUM NEUTRAL CITATION: | [2015] VCC 1209 | |
REASONS FOR SENTENCE
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Subject: Criminal law – sentencing – “white collar” offender – application of Bulfin principles – immediate term of imprisonment imposed.
Catchwords: Criminal Sentence. White Collar Crime. Theft. Financial Control.
Legislation Cited: Sentencing Act 1991 (Vic).
Cases Cited: DPP v Bulfin. R v Gregory. R v Dyason. DPP v Bulfin. R v Gianello. Boulton v The Queen.
Sentence: 4 years 6 months to serve 2 years and 6 months.
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APPEARANCES: | Counsel | Solicitors |
| For the DPP | Mr Porceddu | Ms V Anscombe, Acting Solicitor for Public Prosecutions |
| For the Accused | Mr Hevey | Tony Hannebery Lawyers |
HER HONOUR:
1 Gary Johnson, you have pleaded guilty to eight charges of theft on Indictment Number F10339335. Those charges relate to offending that occurred whilst you were the financial controller employed by Radisson Hotels. The offending spans approximately seven years, from 17 September 2007 until 11 June 2014.
2 Your offending is serious and that is reflected in the maximum penalty that is prescribed by Parliament for this offence and that is ten years’ imprisonment.
3 You are now aged 57 and you have no prior criminal history.
4 I shall proceed to sentence you on the basis of the agreed facts that were read into the transcript during the plea hearing. There was no objection taken to the summary by your counsel, Mr Hevey. The offending is admitted and the various schedules attached to the indictment are admitted. Those schedules are set out in full and precise details, the various amounts that you stole from your employer. These are eight “rolled-up” charges.
5 This is a course of conduct that took place over a protracted period. A large sum of money was stolen, namely $681,000.18. Your offending came to the notice of your employer when, in early 2014, it was noted that your work performance was in decline and that you were failing to complete various tasks. In April/May 2014 the general manager of the hotel had concerns about the hotel’s financial position and organised an audit and review of the hotel’s bank account, whereupon it was noted that a large number of transfers from the hotel bank account were made into your personal bank account and the personal bank accounts of others who are unknown to the hotel.
6 Following the hotel’s bank confirming the transfers, a meeting took place between yourself and your general manager on 13 June 2014, when the irregularities were put to you. Immediately after that meeting you were suspended on full pay pending the outcome of further investigations and on 16 June 2014 you resigned effective immediately.
7 The police became involved and during their investigations they identified the amounts stolen. It is noted that there were some 362 unauthorised funds transferred which were deposited into five bank accounts:
(i) GR & J Johnson, being a joint account that you held with your wife, the amount of $413,000.90 was paid into that account;
(ii) Mr Warwick Vanderbilt (formerly Owen) had $199,665.18 paid into his account;
(iii) Mr Ritchie Pham had $16,250.00 paid into his account;
(iv) Mr Cutajar was paid $47,495.00 into his account;
(v) Mr Leonard was paid $4,600 into his account.
8 Your wife was not aware of the offending. Investigations revealed Vanderbilt was a male escort, and it is evident now that both Mr Pham and Mr Cutajar were also male escorts. Mr Leonard was a personal trainer who was training you at the hotel’s gym.
9
On 29 January 2015 police attended and executed a search warrant at your home. Only your wife was present. You attended the Melbourne Criminal Investigation Unit later that day, where you were arrested and interviewed. You made a “no comment” Record of Interview. You were charged on
29 January 2015 and a Committal Mention was held on 23 April 2015. At the further committal mention on 10 June 2015, this matter resolved and proceeded by way of a straight hand-up brief. It is accepted by the prosecutor that you entered early pleas of guilty in respect to each of the charges.
10 No Victim Impact Statement was filed but it is obvious from the nature of your offending, over such a protracted time, that the hotel's finances have been effected and the detection of these crimes would have caused some inconvenience. I note that there has been reparation and I will refer to that shortly.
11 Mr Hevey, on your behalf, accepted that as Financial Controller you were acting in clear breach of the trust reposed in you by your employer. He accepted that the offending occurred over a protracted period and involved large sums of money. He highlighted on your behalf the fact that you entered a plea of guilty at the first available opportunity. I accept that factor put in mitigation. As a consequence of your plea of guilty entered at the earliest stage, you have facilitated the course of justice. You have spared the state the expense and necessity of a trial and also the further inconvenience that would have resulted from a trial. There is real utility in your plea and your sentence will be discounted accordingly. I accept that it is also demonstrative of genuine remorse.
12 I note by way of background, your personal history is unremarkable. You were raised by your parents whom you describe in positive terms. Your father died in July 2005 at age 75 as a consequence of a long-term chronic illness. Your mother, now aged 81, is still living in the family home in the country and you have a close relationship with her. You have an older and younger sister. As a child you were raised in St Albans and attended school in the area until the end of Year 10. You left school aged 16. You have a strong work ethic that is reflected in your work history. It is noted you have long-standing and stable employment and that eventually, over the years through your work experience and completion of a Bachelor of Business Studies, you were promoted initially to Assistant and then Financial Controller of various companies within the hospitality industry.
13 You married your wife, Jacqueline, in 1982 and there are two daughters who were born of that marriage. Your older daughter, Sarah, gave evidence at the plea hearing and she described her family as close knit and said her upbringing was “perfect”. She was not aware that you were involved in this criminal activity. She confirmed that her husband and his father run an accounting firm with whom you have had some casual employment following the charges being laid and it is anticipated that there will be work with that practice once these proceedings are finalised.
14 I note you commenced work with the Radisson Group in April 2005. You initially reported enjoying the job.
15 Following the laying of charges for this offending your wife, Jacqueline, experienced extreme anxiety and other medical illnesses. She suffered a real deterioration in her health around January 2015 when the police attended your home to arrest you, and thereafter she remained extremely distressed and anxious. She developed serious medical issues and psychological problems that only partially responded to medication. She also developed heart problems and eventually she succumbed to her various illnesses and died on 9 July 2015. You acknowledge strong feelings of guilt over her death given the temporal relationship between her death and the deterioration of her health following the revelation of this offending.
16 Since you have been charged with these offences you have been treated for anxiety and depression and you have also had some panic attacks.
17 A report of Dr Stan Alexiou, clinical psychologist, of 1 September 2015, states he has been providing you with supportive therapy and assisting you to manage your diagnosed depression and anxiety, including panic attacks. He noted that you experienced suicidal ideation. However, protective factors have been your daughters and the grandchildren. Your depression was exacerbated by your wife’s sudden passing and the fact that you have been consumed with feelings of grief. You are prescribed the anti-depressant, Loxalate, and the anti-anxiety mediation, Exazepam.
18
It is apparent from the prosecution summary that the moneys that you stole were used by you to indulge and support a fantasy life that you kept completely compartmentalised from your life with wife, family and friends.
Mr Hevey described it as a fantasy world whereby you started stealing to support your “Walter Mitty” type lifestyle. When you first commenced the criminal behaviour you found that you were able to indulge and support this fantasy world but that you always lived in the expectation of a “knock at the door”.
19 Mr Joblin, the forensic psychologist who interviewed you and has provided a report dated 18 August 2015, states it is very difficult to locate any specific catalyst that might have pre-empted the offending. You reported to him that there were no significant financial problems and that you had not been leading an ostentatious lifestyle. He postulates that it is simply the case that you found you could obtain money, and then found you could obtain gratification, by using that money to lead a life that you had never considered possible before.
20 Whilst providing some explanation for your behaviour, this in no way excuses your behaviour. You committed this offence whilst you were in a trusted position as Financial Controller of the company. There is a real need in sentencing you to emphasise general deterrence and denunciation of your behaviour by the court.
21 In terms of your own health condition, I accept that your diagnosed anxiety and depression, and the grief reaction following your wife’s sudden passing, do combine, such that I consider that your time in custody will be more onerous for you than a person who otherwise enjoys normal health, and I have taken that into account.
22 I have further taken into account Mr Joblin’s opinion that there is an expectation that incarceration will exacerbate your depressive symptoms.
23 During the plea hearing I was provided with some information about a cranial nerve problem that you had from about 2005 onwards. That was treated effectively by way of operative treatment in August 2009, following which you had a good outcome. Mr Hevey put it that because of that condition there was a possibility that you were aware of your own mortality and therefore engaged in this fantasy lifestyle. I do not accept that the pre-existing medical condition is in any way linked to your offending.
24 Mr Hevey, in support of a disposition that did not involve your immediate incarceration, relied on the facts of your early plea of guilty at the first opportunity, your peculiar personal circumstances, the fact that you had taken full responsibility for your offending and also that you settled the civil action whereby some reparation has been made for your thefts.
25 I note that you did pay $100,000 reparation to the Radisson Hotels and that the balance of outstanding moneys that were stolen has been repaid through an insurance claim by the company, so that the hotel is not out of pocket.
26 Mr Hevey also emphasised the grief associated with the loss of your wife and submitted, having regard to all those factors, and including your past good character, that a Community Corrections Order structured in a way that you could repay the community through community work would be appropriate punishment. He referred to the recent guideline judgment of Bolton.
27 I have read the ten references filed from persons who have known you closely over many, many years. There were references from close family, friends and neighbours and professional colleagues. It is evident from reading those reports closely that your fantasy life was not known to them. Nonetheless, they all attest to the fact that you are considered to be a hardworking person who has a strong work ethic, who was an active family man and has always demonstrated your willingness always to help others. Each of the authors of the references were shocked by the offending. They stated it was out of character and they each spoke of your extreme remorse. They all remain supportive of you.
28 I note that Mr Ray Bennici gave evidence at the plea hearing, and notwithstanding that he was not aware of the precise details of your offending, he still remains of the same opinion as he expressed in his reference.
29 I accept that otherwise you were considered to be a person who did have a good reputation and I accept this offending is out of character. However, that is not unusual in these white collar crimes. Often this sort of offending is easy to commit, difficult to detect and is usually committed by persons holding a position of trust who are otherwise of good character.
30 Mr Porceddu, on behalf of the Director of Public Prosecutions, submitted that a gaol term to be immediately served was appropriate punishment in all the circumstances.
31 There was discussion during the plea hearing concerning the appropriate disposition and I was provided with a number of decisions from judges of this court where it was said they considered and granted Community Corrections Orders for similar offending. As I discussed in the plea hearing, each case has to be dealt with on its own particular facts and circumstances, and I have had little guidance from those other cases that were relied upon by Mr Hevey.
32 Having regard to your gross breach of trust, the protracted period over which your offending occurred, the fact that you received substantial monetary benefit that was employed to pay for your fantasy lifestyle, and the fact that I consider that this is a very serious example of this sort of offending, I have come to the conclusion that no other sentence other than a gaol term to be immediately served is appropriate in all the circumstances.
33 I have had regard to the mitigating factors highlighted by Mr Hevey. I accept, as I have already stated, that there has been some reparation in respect to the hotel’s loss. I accept that you do now publicly acknowledge the wrongfulness of your offending, that you are remorseful and I consider, having regard to your response following the laying of these charges, that you are not a person who is at risk of re-offending in a like nature in the future. Therefore, the need for specific deterrence has less application in your case. I consider that your rehabilitation prospects are excellent.
34 You have the ongoing support of both of your daughters and your close family and friends. They are willing to continue to support you into the future. I note Mr Joblin stated in his report that you are a person of good intellect and you are not psychotic. There is no suggestion of any other factors that are sometimes a feature of these sorts of cases, such as alcohol, drugs or gambling.
35 In sentencing you there is a real need for this court to emphasise general deterrence. It is widely accepted in cases of white collar crimes which involve a breach of gross breach of trust that general deterrence is the principal sentencing factor. There is also a requirement for strong denunciation by the sentencing court. I refer to the case of DPP v Bulfin[1] and R v Gregory[2].
[1][1998] 4 VR 114 (‘Bulfin’).
[2][2011] 34 VR 1, 18 [66] (‘Gregory’).
36 Regardless of the evidence which I accept of your good character, I consider your offending is so serious as to warrant condign punishment.
37 Recently, the Court of Appeal. in the case of R vDyason[3] considered the appropriateness of making a Community Corrections Order for serious white collar crime of the kind possessing many of the features of your offending. Specifically, in rejecting a submission that a short term of imprisonment coupled with a Community Corrections Order was appropriate in that case, the court referred with approval to what had previously been said by Justice of Appeal Charles in DPP v Bulfin[4].
[3][2015] VSCA 120 (‘Dyason’)(Wheelan, Santamaria and Beach JJA)
[4][1998] 4 VR 144 (‘Bulfin’).
38 In Mrs Dyason's case, she was charged with seven charges of obtaining property by deception. Her offending occurred over seven years. She was a Financial Controller and she systematically diverted cash and moneys into various accounts. She confessed, was cooperative with authorities, assisted them in compiling precise details of her offending. She entered a plea of guilty at first opportunity. She was remorseful. There was some years delay in her charges being laid and there was evidence of her rehabilitation through counselling.
39 The Court of Appeal, in Dyason, went through in great detail the reasoning in Bulfin. In Bulfin, the court was considering a sentencing appeal from an offender who pleaded guilty to a variety of offending, involving fraud and deception concerning public investments of many millions of dollars. In that case, the offender has also pleaded guilty early, was remorseful, cooperative with authorities and agreed to give evidence against other accused, was a person otherwise of good character.
40 In that case though, a submission was made on behalf of the offending on the sentencing appeal, that in white collar cases there should be a wider than normal gap between the head sentence and non-parole period. Justice of Appeal Charles, with the then President Winneke, and Justice of Appeal Callaway, relevantly agreed, rejecting that submission. In his remarks, Justice of Appeal Charles emphasised the importance of general deterrence in white collar crime matters. It is important for the court to emphasise that. He referred in great detail to features that had a tendency to distract attention from the importance of general deterrence in white collar crimes. Then he said the following:
41 "The motivation to engage in conduct of the kind here under consideration may spring from many sources: a position of trust, and the easy ability to abuse it; the enormous rewards that may be available; the position of high authority in some substantial enterprise, and the offender's assumption that discovery or proof of wrongdoing can be avoided; greed or the burden of funding an extravagant lifestyle; weakness in succumbing to outside pressures to use deceitful means for business ends; and personal or corporate ambition, to name but a few. Whatever the motivation, offences of the kind here in question almost invariably involve a carefully calculated course of conduct over a long period, repeated deliberate acts of dishonesty, substantial amounts of money and frequently losses, often tragic in their impact to large numbers of small investors. The offender often holds a position of making it possible, or has the ability to disguise or camouflage the conduct in question. Detection is difficult, investigation of the crime usually lengthy and very expensive and the problems of trial will frequently be extreme.”
42 He goes on further in his judgment to say:
"For persons first contemplating corporate criminality, a sentence which requires an offender to spend a substantial term in actual custody, by virtue of the non-parole period fixed, is in my view much more likely to focus their attention, and have real deterrent impact, than a longer head sentence, much of which is likely to be served on parole after the offender's release from custody".
43 If this view would be correct, to fix an unduly short non-parole period would, in cases such as the present, be quite subversive of the whole concept of general deterrence, notwithstanding that a significantly longer head sentence was imposed.
44 In a recent case of R vGianello,[5] another case involving dishonest obtaining financial advantage by deception involving significant sums of money, the Court of Appeal endorsed the reasoning in Bulfin and Dyason.
[5][2015] VSCA 205 (‘Gianello’).
45 In Dyason, the Court of Appeal went through an analysis of the guideline judgment in Boulton. It did not suggest that a sentence involving a Community Corrections Order would never be appropriate for a white collar offender, but rather said that the considerations referred to in Bulfin remain relevant.
46 Given the nature of your offending, Mr Johnson, the amounts involved, the duration of which your offending, and my categorisation of the seriousness of your offending, in my view nothing short of a sentence wholly comprised of an immediate term of imprisonment would suffice to satisfy the requirements of just punishment. A Community Corrections Order, either alone or in conjunction with a sentence of imprisonment would not, in my view, satisfy the requirement of just punishment and the need to emphasise general deterrence in cases of this kind.
47 Given the nature of your offending, and notwithstanding the significant mitigating factors that were put on your behalf by Mr Hevey, I propose to impose a term of imprisonment.
48 I will announce the formal orders now. Could you please stand, Mr Johnson?
49 In respect to the eight charges of theft on the indictment, you are convicted and sentenced to an aggregate term of imprisonment of four years and six months and I fix a non-parole period of two years and six months.
50 Pursuant to s.6AAA of the Sentencing Act 1991, I state that but for your plea of guilty I would have sentenced you to six years and six months' imprisonment to serve four years and six months before being eligible for parole.
51 I make a declaration of pre-sentence detention of two days and I direct that that be entered into the records of the court.
52 Finally, I make the order in respect to the taking of a forensic sample pursuant to s.464ZF of the Crimes Act 1958. Are those orders available?
53 MR PORCEDDU: I do have that order here, Your Honour.
54 HER HONOUR: So I've got to explain to you what that means. In terms of that last order, Mr Johnson, the taking of forensic sample involves scraping of the mouth to take asample. What will happen is that you'll be provided with a cotton bud to place inside your mouth. I have to tell you that if you don't consent to that procedure being taken, then the sample can be taken and the police may use reasonable force to enable that forensic procedure to be conducted. Do you understand that?
55 OFFENDER: Yes.
56 HER HONOUR: All right. I have made that order having regard to the seriousness and the circumstances of your offending. The order was not opposed and the granting of the order is in the public interest.
57 I think I've covered everything, gentlemen. I'll just sign these orders and then once that's done, Mr Johnson can be taken into custody down in the cells. I can confirm that the Corrections authorities were provided with all the medical material that we received in the plea hearing, Mr Hevey.
58 MR HEVEY: Thank you, Your Honour.
59 HER HONOUR: So they're fully aware of his pre-existing conditions and management issues. That's the orders, thank you. Yes, thank you.
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