Director of Public Prosecutions v Kelly
[2014] VCC 1983
•26 November 2014
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
CRIMINAL DIVISION
CR 14-00174
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| LEIGH BRIAN KELLY |
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JUDGE: | HER HONOUR JUDGE CANNON | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 18 November 2014 | |
DATE OF SENTENCE: | 26 November 2014 | |
CASE MAY BE CITED AS: | DPP v Kelly | |
MEDIUM NEUTRAL CITATION: | [2014] VCC 1983 | |
REASONS FOR SENTENCE
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Subject: CRIMINAL LAW
Catchwords: Sentence – Plea of guilty – Theft – Rolled-up charges – Breach of trust – Gambling addiction – Major depressive disorder – Suffers from Crohn’s Disease
Cases Cited:R v Verdins (2007) 16 VR 269 ; R v Yi Yi Wang [2009] VSCA 67; R v Cusack [2009] VSCA 207
Sentence: Aggregate term of 18 months’ imprisonment with a non-parole period of 9 months’ imprisonment; Pre-sentence detention of 65 days declared as having been served; s.6AAA Sentencing Act 1991 declaration; Ancillary orders – Forensic sample and compensation
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APPEARANCES: | Counsel | Solicitors |
| For the DPP | Mr Luke Exell | Solicitor for Public Prosecutions |
| For the Accused | Mr William Barker | David Barrese & Partners |
HER HONOUR:
1 Leigh Brian Kelly, you have pleaded guilty to three charges of theft, which offence carries a maximum term of ten years’ imprisonment. The maximum penalty indicates the seriousness with which Parliament regards the offence of theft.
2 The charges are “rolled up”, comprising a total of 22 occasions of offending committed between 25 January 2011 and 25 January 2012.
3 The total amount of money stolen was $135,293.
4 You were aged between forty and forty-one at the time you committed the offences.
5 You had commenced employment with the Moonee Valley City Council (“the Council”) in October 2006 and, at the time of the offences, you were the finance manager for the Council. Therefore, you held a significant position of trust in respect of the Council’s finances.
6 You used different methods to obtain the monies. Each of the methods used gives rise to charges on the indictment.
7 The basis for Charge 1 is that on nine separate occasions, you completed and submitted employee reimbursement forms for various costs which you represented were related to your employment or position with the Council. You falsely represented in the reimbursement forms which you submitted, and on occasion with false supporting documentation, that you had incurred costs associated with CPA membership and also associated with courses and/or educational expenses. The total amount of money obtained using this method totalled $24,358. The details of the occasions were set out in the prosecution opening and I shall not repeat these. The summary of prosecution opening will be annexed to my sentencing remarks and form part of my remarks so as to incorporate these occasions. However, I observed that on two occasions, which were about a month apart, you obtained reimbursement for a residential component of an MBA course in the sum of $2,445, and then, in May 2011, you obtained reimbursement for an MBA course in the sum of $9,788. In January 2012, you were reimbursed $5,180 for an MBA course. The other expenses pertained to CPA events or membership of CPA and IPA membership.
Method 2 – Charge 2
8 The basis for Charge 2 is as follows. Within your role as finance manager, you had authority to authorise payment of invoices received by the Council from service providers.
9 On five separate occasions, you submitted false invoices from a company named “Dawtek Risin Pty Ltd”. The invoices sought payment for consulting services said to have been provided to the Council.
10 You authorised payment of the invoices into the bank account nominated on the company invoice. The bank account was in fact an account jointly held by you and your former wife. The total amount of monies obtained using this method totalled $43,725.
11 Again, the details of these various false invoices were again set out in the prosecution opening.
Method 3 – Charge 3
12 In relation to Charge 3, on eight separate occasions, you submitted false invoices from a company called “Continuous Performance Improvement Pty Ltd” which were provided to the Council. The invoices sought payment for provision of consulting services said to have been given to the Council.
13 Again, you used your authority as finance manager to authorise payment of the invoices from council funds into the company’s nominated bank account. The bank account was in fact held by you.
14 The total sum obtained in this way was $67,210.
15 The various occasions are detailed in the prosecution opening.
16 Payment of the money sought in respect of these invoices was generally paid within days of you submitting the invoice to the Council. You would then withdraw the money from the bank accounts via internet banking. The prosecution was not able to ascertain where the funds were transferred to.
17 On 31 January 2012, a management accountant at the Council spoke to the finance and business support officer, Ms Lucy Smith, regarding her concerns about invoices from Continuous Performance Improvement Pty Ltd. Ms Smith commenced inquiries regarding this and other invoice payments which you had authorised.
18 Following these inquiries, you attended a meeting on 13 February 2012 held by the director of Corporate Services, Mr Anthony Smith, and the chief executive of the Moonee Valley City Council, Mr Neville Smith. You were told that there appeared to be a lack of compliance with the Council’s procedures relating to payment of contractors and that payment appeared to have been authorised and made to your personal bank account. You said that you were “testing the system” and had a cheque in your office desk drawer to reimburse the Council. However, no cheque was to be found at your office. At the end of the meeting, your employment was suspended pending further investigation.
19
A further meeting was held with you and the same council officers on
15 March 2012. At the end of the meeting, you offered your resignation which was subsequently accepted.
20 The Council then reported the matter to police on 21 March 2012.
21 You were interviewed by police at the Moonee Ponds Police Station on 19 April 2012, but provided a “No Comment” record of interview on legal advice.
22 You were charged on 30 July 2013 and pleaded guilty to the charges which are on the indictment on 3 February 2014, after an unsuccessful application for summary jurisdiction in the Magistrates’ Court. The matter was listed for a plea hearing on 11 September 2014. However, you failed to attend and were arrested, then remanded in custody on 22 September 2014 which is where you have remained.
23 Mr Kelly, objectively, your offending is serious and is aggravated by the fact that you significantly breached the trust that the Council had placed in you and further, the monies which you stole were public monies. You offended repeatedly over a fairly lengthy period of time and you used your position and skills to engage in deceptions which had a level of sophistication about them.
24 Your offending conduct is deserving of a punishment which is just in all of the circumstances and your conduct must be denounced. A relevant circumstance in your case is that, at the time you committed these offences, you were suffering from major depressive disorder, being depression and anxiety due to the stresses of finances and your sense of desperation, which then fed into a gambling addiction. Ms Swan, psychologist, found that at the time of the offending, you were suffering from major depressive disorder, and that this condition continues. In light of Ms Swan’s diagnosis in this regard, the submissions made by your counsel and the concessions made by the Crown, I allow for a degree of reduced moral culpability as your depression and anxiety clouded your judgment and capacity to make rational decisions. I allow for some moderation to the principles of specific and general deterrence. Whilst strong weight would normally attach to general deterrence in a bid to deter others from behaving as you have, I reduce the weight to a small degree because of your difficulties at the time and presently, in terms of your mental state. Further, I make allowance in your favour because time in gaol will be harder for you than for someone without your mental health difficulties. I make further allowance for the fact that you suffer from Crohn’s disease, which will again make time in gaol harder than for someone without this condition.
25 I accept that, save for this offending, you are of otherwise good character, as the material provided on your behalf suggests. You have a strong work ethic and have worked continually, whilst and since obtaining your qualification as an accountant, without incident until the offences before me. You have no prior convictions and the material provided in support of your character indicates that you have significantly contributed in a positive way to the community over a lengthy period.
26 You entered a plea of guilty at an early stage in the proceedings which entitles you to a significant discount in the sentence you would otherwise receive. In pleading guilty at an early stage, you have saved the witnesses the time and trouble of giving evidence at committal hearing and trial, and you have saved the community the significant expense of contested proceedings. Although you made admissions to transactions at first instance in the meeting with the Council on 13 February 2012, I do not accept that these admissions were extensive or made in the context of admitting fault on your part. However, I do accept that you now have genuine remorse in relation to your conduct, albeit that it is in the context of you having been caught rather than having a change of heart about your offending at the time. Since the offending, you have made fairly significant efforts to deal with your addiction to gambling, enlisting the assistance of a counsellor/psychologist, Ms Valentina Markovska. You have had some relapse into gambling since the offending, although you have not committed further offences when you have resorted to gambling once more. I understand that your resort to gambling has occurred at times when you feel stressed and without support.
27 You have remained abstinent from all gambling since August this year, although it must be factored in that it was shortly after August that you were remanded in custody.
28 I take into account your background:
29 You were born and raised in a loving family. Unfortunately, your father, who had often been in poor health, died in 2001 and your mother, to whom you were very close, died in 2013 as a result of a chronic asthmatic condition. You had enjoyed a close relationship with an older brother and sister until fairly recently when you relapsed into gambling once more. When this occurred, they ceased contact. To your perception, your siblings, including a half-brother from a previous relationship of your mother’s, ‘washed their hands’ of you because of your offending and further relapse into gambling.
30 You did well at school, both academically and at sport. You attended horse racing and the like with your father as you were growing up and saw gambling as a source of entertainment and a means of social engagement. Unfortunately, this helped shape your attitude to gambling in your adult years.
31 Your wife of nine years ended the marriage in 2011 when she learned of your issues in respect of gambling. It appears that this was at a time when you had commenced offending to feed your debts and your gambling addiction which had developed. You have two children of that relationship who are now four and seven years old. After the birth of your first child in 2007, your wife, who was a teacher, was unwilling to return to paid work. In reciting this, I make no criticism whatsoever of your wife’s decision, it is simply what occurred at that time. You resorted to gambling initially in a bid to address mounting financial pressures. You thought that you could make more money for the household in this way. At first, you were successful in this regard, however, inevitably you began to lose money. Financial pressures increased further after the birth of your second child in 2010. In part, this was due to your gambling. You accrued significant debts to bookmakers and were experiencing symptoms of depression and anxiety in respect of these and other stresses in your life, including the failing health of your mother and disintegration of your marriage. It was in this context that you resorted to the offending. You gambled in a bid to pay the mounting debts but also to help alleviate your depressive and anxious state. Although I take into account your gambling addiction in a general way and in respect of its contribution to your offending, I do not regard it as something which you can call in aid as mitigatory or as attracting Verdins principles, for the reasons set out by His Honour Redlich JA in R v Yi Yi Wang [2009] VSCA 67, recently referred to in R v Cusack [2009] VSCA 207 at paragraph 16.
32 The impact of separation from your wife and children when she moved out was devastating to you and further exacerbated your gambling addiction and resort to offending. You have turned to gambling in times of stress and isolation. Fortunately, you now have the support of some fine friends and their support will assist you in your rehabilitation. It is most important that you do not feel ashamed to reach out to these people now and in the future. Further, you wish to be a positive role model in your children’s lives which you are more than capable of achieving. It is important for their development that they have their father involved in their lives.
33 I have also taken into account that the loss of your position, in view of your history, as a reputable accountant constitutes a significant fall from grace. It is most unlikely that you will be ever able to practise as an accountant again and will have to resort to less remunerative work in the future. You have telephone contact with your children, from my reading of Ms Swan’s report, whilst you have been on remand. However, they do not come to see you. I also allow that time in custody will be harder for you than for someone who was able to see his children in these circumstances, children to whom you are devoted, as I understand the position. I have also factored in that this is your first time in custody and is, no doubt, and will be, no doubt, a salutary experience for you.
Delay
34 I have taken into account that when you left the Council you did not claim benefits which you might have in the sum of about $22,000 and you have expressed the wish to do what you can to repay the Council when you are able to do so, which is indicative of remorse on your part.
35 I take into account that there has been a fairly lengthy delay in this matter, although this may be partly explained by the investigation involved in uncovering all of your offending. No matter the reason, you have had the anxiety of these matters hanging over your head from early 2012. You have not committed a further offence in the intervening period, save for the fact that you breached bail by not attending at the plea hearing in September 2014. Indeed, you could have had the matter dealt with at that time if you had not chosen to absent yourself from proceedings. Apart from this, however, you have committed no offence since the offences for which I now sentence you and so you have used the time productively overall in trying to rehabilitate yourself. You have shown a commitment to your rehabilitation by engaging with Gamblers Anonymous, a “Cognition and Decision-making in Gambling” study with Monash University in 2012, and then ongoing treatment with Ms Valentina Markovska. In this regard, there was an interruption to this treatment when you were living in Geelong and you relapsed into gambling at this time.
36 Returning to gambling is a risk factor for you in terms of committing further offences in the future. Although you have returned to gambling in the very recent past without offending, your gambling addiction was raging at the time that you committed the offences for which I now sentence you and you must abstain from gambling in order to avoid committing further offences. In this regard you have expressed a willingness to continue counselling with Ms Markovska who is a psychologist and who has assisted you in the past in addressing or helping to address your gambling addiction. She is willing to take you on in the future, initially on the basis of a mental health plan, but she would also come to some financial arrangement beyond this in order to help you. In the end, I find that you have good prospects of rehabilitation for the following reasons:
·You have no prior convictions.
·Your early plea of guilty and genuine remorse for your actions, which have constituted a significant fall from grace and sense of shame.
·You have shown a fairly significant level of commitment to rehabilitation by engaging in treatment to address your mental state and gambling addiction and are willing to re-engage when able to do so.
·You have also shown an acceptance of your offending by disclosing it to a subsequent employer, who then terminated your employment.
·You now have a strong friendship group, who are aware of what you have done and who are offering their strong support to you.
·You have a strong work ethic and have demonstrated a strong commitment to the community in the form of honorary positions in various sporting associations and further, as I have previously remarked, gaol no doubt is and will be a salutary experience for you.
37 For these same reasons and because of further reduction because of Verdins considerations, I need only place minimal weight on specific deterrence.
38 Your Counsel’s principal submission was that you be assessed for a community corrections order, such that you are sentenced to a period of imprisonment in combination with a gaol term. The prosecution submitted that it was appropriate for you to serve an immediate term but had no instructions in respect of whether this might be served in combination with a community corrections order.
39 Mr Kelly, at the end of the day, it will be up to you and your decision to continue on a path of recovery which will determine your future. In your case, I have taken the view that it is not appropriate to impose a gaol term in combination with a community corrections order, but to impose a term of imprisonment with a slightly longer than usual parole period in a bid to have you address your issues in the community under supervision, which parole will afford, and after serving a term which I consider adequately addresses all relevant sentencing principles:
40 In arriving at an appropriate term, I have also considered current sentencing practice for offending such as yours.
41 In relation to each of the offences you are convicted.
42 I make the following ancillary orders. Firstly, I make a forensic sample order to be taken from you by way of a scraping from the mouth. I make the order because it is not opposed by you, because of the seriousness of the offences and because it is in the public interest to do so.
43 Notwithstanding your present lack of opposition to the order, I warn that if you do not co-operate with the officer who is authorised to take the sample, reasonable force may be used to ensure your compliance.
44 I make the compensation order in the sum of $135,293 payable to the Moonee Valley City Council.
45 In respect of Charges 1, 2 and 3, you are sentenced to an aggregate term of 18 months' imprisonment and I direct that you serve nine months before becoming eligible for parole.
46 I declare that you have already served 65.days by way of pre-sentence detention.
47 If not for your pleas of guilty, I would have sentenced you to a total effective sentence of 2 ½ years' imprisonment, with a non-parole period of 18 months’ imprisonment.
48 Is there anything arising from that?
49 MR EXELL: No, Your Honour.
50 MR BARKER: No, Your Honour.
51 HER HONOUR: Thank you, you can remove Mr Kelly, thank you.
PROSECUTION OPENING UPON PLEA
INDICTMENT
The Offender pleads to three ‘rolled up’ charges on Indictment. The charges represent 22 occasions of offending committed between 25 January 2011 and 25 January 2012.
The amount of monies obtained totals one hundred and thirty five thousand two hundred and ninety three dollars - $135,293.
BACKGROUND
The Offender Leigh KELLY was born on 19 April 1971 and was aged between 40 to 41 at the time of offending.
He commenced employment with the Moonee Valley City Council (‘the Council’) in October 2006. At the time of offending he was employed as the Finance Manager for the Council.
OFFENDING
The Offender used different methods to obtain the funds.
METHOD 1 - CHARGE 1
Within his employment the Offender had an agreement that the Council would reimburse some costs that were related to his employment / position description. Upon receipt of a completed ‘Employee Reimbursement Form’ the Council would pay the sought costs into the Offender’s bank account.
The Offender obtained funds from the Council using this method on 9 separate occasions by completing and submitting the forms, and on occasion with false supporting documentation, for costs that he had not incurred. The claims were submitted (and subsequently paid by the Council) for items that included costs associated with CPA membership and associated courses and/or educational expenses.
The total amount of money obtained using this method totalled $24, 358.
Occasions:
a.Between 25.01.2011 and 27.01.2011 the amount of $937 ( “2011 CPA membership”)
b.On 03.02.2011 the amount of $2445 (“residential component of MBA course”)
c.On 24.03.2011 the amount of $2445 (“residential component of MBA course’)
d.Between 12.04.2011 and 14.04.2011 the amount of $880 (“CPA Week Conference”)
e.Between 08.05.2011 and 09.05.2011 the amount of $9788 (“MBA course”)
f.On 09.06.2011 the amount of $815 (“2011 IPA membership”)
g.Between 05.10.2011 and 06.10.2011 in the amount of $890 (“CPA Congress event”)
h.On 01.12.2011 in the amount of $978 (“2011 CPA membership”)
i.Between 24.01.2012 and 25.01.2012 in the amount of $5180 (“MBA course”)
Method 2 –CHARGE 2
Within his role as Finance Manager the Offender had authority to authorise the payment of invoices received by the Council from service providers.
On 5 separate occasions the Offender submitted false invoices from a company named Dawtek Risin Pty Ltd[1]. The invoices sought payment for the provision of consulting services purportedly provided to the Council.
[1] Refer Statement of Kristine DAW, pp 74-75
The Offender authorised the payment of the invoices into the bank account nominated on the Company invoice.
This bank account was in fact an account jointly held by the Offender and his former wife.
The total amount of money obtained using this method totalled $43, 725.
Occasions:
a.Between 18.07.2011 and 08.08.2011 in the amount of $10725
b.Between 15.08.2011 and 19.08.2011 in the amount of $6325
c.Between 21.08.2011 and 29.08.2011 in the amount of $13200
d.Between 07.09.2011 and 15.09.2011 in the amount of $4950
e.Between 22.09.2011 and 06.10.2011 in the amount of $8525
Method 3 – CHARGE 3
On 8 separate occasions the Offender submitted false invoices from a company named Continuous Performance Improvement Pty Ltd to the Council[2]. The invoices sought payment for the provision of consulting services purportedly provided to the Council.
[2] Refer Statement of Leanne PLANCK, pp 77-78
The Offender, again utilising the authority provided to him as Finance Manger, authorised the payment of the invoices by the Council into the Company’s nominated bank account.
This bank account was in fact an account held by the Offender.
The total amount of money obtained using this method was $67, 210.
Occasions:
a.Between 01.10.2011 and 05.10.2011 in the amount of $8250
b.Between 12.11.2011 and 24.11.2011 in the amount of $8525
c.Between 09.12.2011 and 12.12.2011 in the amount of $9075
d.Between 12.12.2011 and 15.12.2011 in the amount of $7260
e.Between 18.12.2011 and 22.12.2011 in the amount of $9900
f.Between 28.12.2011 and 30.12.2011 in the amount of $7150
g.Between 03.01.2012 and 04.01.2012 in the amount of $9350
h.Between 15.01.2012 and 18.01.2012 in the amount of $7700
Payment of the money sought within the respective invoices, into bank accounts held by the Offender, usually occurred within days of submitting the invoice to the Council. Upon receipt of the money the Offender would withdraw the money from those bank accounts via internet banking transfers. It is not known where these funds were transferred to[3].
[3] Refer Statement of DSC Mark KRISTIC, page 72
ENQUIRY AND INVESTIGATION
On 31 January 2012 a Management Accountant at the Council spoke to the Finance and Business Support Officer Ms Lucy SMITH regarding her concerns about invoices payable to Continuous Performance Improvement Pty Ltd. Ms SMITH commenced enquiries regarding this and other invoice payments the Offender had authorised.
Following these enquires the Offender attended a meeting on 13 February 2012 held by the Director of Corporate Services (Mr Anthony SMITH) and the Chief Executive of the Moonee Valley City Council (Mr Neville SMITH).
Within this meeting the Offender was advised that there appeared to be non-compliance to the Council’s procedures relating to payment of contractors and that payments appeared to have been (authorised and) made to the Offender personal bank account.
The Offender provided that he was ‘testing the system’ and that he had a cheque in his office desk drawer to reimburse the Council. No cheque was present at the Offender’s office. At the conclusion of the meeting the Offender’s employment was suspended pending further investigation.
A further meeting was held with the Offender, Mr Anthony SMITH and Mr Neville SMITH on 15 March 2012. At the conclusion of the meeting the Offender offered his resignation which was subsequently accepted by Mr SMITH.
The Council reported the matter to police on 21 March 2012.
CHARGE HISTORY
The Offender was interviewed at the Moonee Ponds Police Station on 19 April 2012 where he provided a ‘no comment’ record of interview.
The Offender was charged on 30 July 2013.
The Offender pleaded guilty to the present offences on 3 February 2014 following an unsuccessful application for summary jurisdiction.
VICTIM IMPACT STATEMENTS
No Victim Impact Statement.
PRE SENTENCE DETENTION
The Offender has served 57 days presentence detention (to be taken into account as time served per s18 Sentencing Act 1991).
MAXIMUM PENALTIES
The maximum penalty for Theft contrary to s74 Crimes Act 1958 is 10 years imprisonment.
APPLICATIONS
Compensation Order: Application is made pursuant to s 86 Sentencing Act 1991.
PLEA OF GUILTY
Section 6AAA Sentencing Act 1991 applies.
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