Director of Public Prosecutions v Ooi

[2018] VCC 2100

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

AT MELBOURNE
CRIMINAL JURISDICTION

CR 16-01561

DIRECTOR OF PUBLIC PROSECUTIONS

v

ANDREW OOI

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JUDGE:	HER HONOUR JUDGE QUIN
WHERE HELD:	Melbourne
DATE OF HEARING:	2 November 2018
DATE OF SENTENCE:	11 December 2018
CASE MAY BE CITED AS:	DPP v Ooi
MEDIUM NEUTRAL CITATION:	[2018] VCC 2100

REASONS FOR SENTENCE
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Subject: Conspiracy to defraud, Common law
Catchwords:
Legislation Cited:
Cases Cited:
Sentence:

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APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Mr A. Sharp	OPP
For the Accused	Mr D. Sala	Stary Norton Halphen

HER HONOUR: 

1ANDREW OOI, you have pleaded guilty to one charge of conspiracy to defraud, between 16 August 2010 and 19 January 2014, contrary to common law, (“the conspiracy charge”)  The maximum penalty for this offence is 15 years' imprisonment.    

2A detailed prosecution opening was filed in these proceedings and I do not propose to repeat those details (see Exhibit A), however in order to understand your offending, it is necessary to set out the background to it with reference to some of the other individuals who were involved in the conspiracy charge, particularly the main players, Barry WELLS and Albert OOI, your father.    

3WELLS and your father were both public servants, working in the area of public transport, employed by, or contracted by, a series of Victorian government transport organisations.    

4During the relevant time, WELLS managed civil works and infrastructure projects for public transport in Victoria, including the construction of bus stops and railway station car parks.  WELLS had responsibility for managing the tender and quoting processes by which contractors were selected or recommended to carry out government works.  WELLS also authorised the payment to contractors for works completed on projects.  Your father, who worked with WELLS, either as an employee or contractor over the relevant period, had a similar role to him, involving project management, the selection or recommendation of successful contractors for civil works projects and the review of tenders.

5Both WELLS and your father were required to comply with the public service policy as set in paragraphs 27-33 of Exhibit A, regarding the Departmental Procurement Process and Conflicts of Interest.  Such was designed to ensure a fair and transparent tendering process, and to protect the State interest in an open and fair competitive system for the awarding of government works contracts.  The level of scrutiny for each contract within the department depended on the value of the works for each job.  They were required to act impartially in the awarding of contracts and to declare any conflicts of interest.    

6From 2007 to 2014 WELLS and your father masterminded a fraudulent scheme to award transport works contracts to various businesses that they covertly controlled, with the assistance of compliant family members, including you, Justin WELLS and Michael De La Torre and other business associates.  These businesses were in fact largely incapable of carrying out the works, so that work was then subcontracted to other companies that were capable of carrying out the tasks.  Of relevance to your involvement in this scheme was that WELLS and your father had a related company or “managed entity”, known as Red Consultancy Group.  Other managed entities were Global Works Management Pty Ltd (GWM) and Redback Civil Pty Ltd. (Redback).     

7GWM was the main managed entity used by WELLS and your father for the fraudulent scheme.  Between January 2008 and January 2013 this company was awarded more than 70 contracts valued at over $8.5m.   Redback was created after the sale by them of GWM for the same purpose.  The total values of contracts awarded to the managed entities and related subcontractors involved during the period of the conspiracy was $17,170,898.85.  The details of the other offenders and their involvement in the conspiracy are contained in paragraphs 17-21 of Exhibit A. 

8Other companies or businesses relevant to the case are GWM Management Services Pty Ltd, HGO Management Services Pty Ltd and AMA & Associates Pty Ltd, companies set up and controlled by your father, through which he moved money out from the managed entities and related sub-contractors.  The money moved through these companies was used for your father’s own benefit and a smaller proportion was also paid to WELLS.  You were a director of AMA & Associates Pty. Ltd. from its inception in January 2012 until at least July 2013.

9On 9 January 2014 search warrants were executed at various addresses relating to your father.  A substantial amount of paperwork and emails were located indicating both WELLS and your father’s role in some of the managed entities, including whilst working at PTV.  Also located were substantial documents relating to the subcontracting of and quoting for works, both to and by managed entities.    

Red Consultancy

10As indicated, you are the son of Albert OOI, though during this offending, you also used the names or alias Andrew Yi and K Yi.   You were the owner of the managed entity business Red Consultancy Group, which was awarded DOI and DOT consultancy contracts by WELLS and your father. 

11Red Consultancy Group was registered as a business name on 3 March 2008 to you, with an address for service recorded as yours and your father’s home address.  Red Consultancy Group was set up by you shortly after the formation of Global Works Management P/L.  The first contract awarded by WELLS to the business occurred the day after its registration.  The business provided consultancy services to DOI and DOT, including tender assessments.

12You were  involved in the selection of  the managed entities as successful contractors for DOI and DOT civil works projects, including Global Works Management.   Your relationship with your father and your association with WELLS was not disclosed to DOI and DOT and it was in your dealings with DOI and DOT that you used the false name.  

13You were involved in the obtaining of contracts for Global Works Management for works at :  

·Kangaroo Flat Railway Station to the value of approximately $500,000;

·Lonsdale Street bus interchange to the value of approximately $770,000;

·Marian College, Myrtleford and Beechworth Secondary College to the value of approximately $410,000; and

·South Gippsland Public Transport Improvements to the value of approximately $830,000.

14Red Consultancy Group recommended Global Works Management for two contracts, totalling approximately $1.2m and recommended other contractors which would then subcontract works to WELLS and your father’s managed entities.   You would undertake the tender assessment with your father and WELLS, with you attending as a panel member using the alias Andrew Yi.  Copies of the assessment authored by you under the false name were located on your computer and digital storage device on execution of a search warrant at your address.  (For an example, see paragraph 45, Exhibit A).  Your involvement meant that WELLS and your father controlled the tender awarding of lucrative contracts, with an apparent element of independence through the use of your consultancy business.  You also received payment for consultancy works which were undertaken to corruptly award contracts to WELLS and your father’s  managed entities.

15In addition to the four contracts you were involved in obtaining for Global Works Management referred to previously, you received payments for six tender consultancy reports prepared by Red Consultancy, totalling $20,350.  A further amount of $183,518 for four civil works contracts was awarded fraudulently to Red Consultancy as part of the conspiracy.

16Red Consultancy Group’s administration and management was conducted by you and your father.  Your alias, Andrew Yi, was used in all Red Consultancy Group correspondence.   On one occasion WELLS and your father were queried by DOT when it was noticed that Red Consultancy invoices were paid into your bank account.  WELLS’ email response to DOT was to falsely deny knowledge of your relationship with your father. 

17As a result of the ten contracts awarded to Red Consultancy Group by DOI and DOT under the advice of WELLS, $203,868.50 was paid by DOI and DOT in the Red Consultancy Group bank account maintained by you.  Global Works Management deposited a further $1,650 and Consalter (another managed entity) deposited $2,200 into the account.   You were the sole signatory for the account.   Financial forensic analysis has identified payments from that account including: 

·$144,594 paid from the account to WELLS and your father’s other managed entities.

·$6,600 to Property Services Network, $7,000 to subcontracts and the ATO.

·The remaining $63,124 was available for use by you.   

18On 9 January when search warrants were executed, a substantial amount of Red Consultancy Group paperwork was located, much of it in a black file organiser in your possession.  These included:

·The Red Consultancy Group Victoria Business Name Renewal, dated
8 March 2011, listing your father as an authorised person;

·DOT purchase orders and EFT payment advices;

·Red Consultancy Group invoices to DOT, addressed to WELLS;

·Subcontracting invoices;

·Taxation documents and banking documents.

19Your father had possession of Red Consultancy Group documents including BAS forms for July to September 2013 and October to December 2013.  A forensic examination and assessment of your computer identified documents located in a folder titled "RED CONSULTANCY GROUP", indicating your involvement in drafting documents relating to management and conduct of the business.  These included tender reviews, assessment summaries for DOI work or tender of GWM, works carried out by WELLS and your father for the department and you as part of Red Consultancy Group. 

As to your individual personal circumstances:

20I received a report from Patrick Newton, Clinical and Forensic Psychologist, dated 21 August 2018.  I also received a bundle of character references from immediate and extended family members, friends and other associates.  I take all of that material into account.  

21You are currently aged 34 years.  You have an older brother and two older half siblings.  You had an uneventful childhood and remain close to most of your family.  You completed Year 12, then attended university and completed an engineering and arts degree in 2008.  You then completed a Masters in Automotive Engineering and have worked with Toyota for the past six and a half years.  Your employer is aware of this matter and has been supportive pending the outcome of these matters.  You have been married since 2008 and your wife remains supportive of you. 

22You have no major issues with mental health, drugs or alcohol, although these proceedings and the time taken for them to be resolved has caused you additional stress. 

23You are clearly an intelligent man.  Mr. Newton is of the view that your level of psychological functioning is better than most in the community and that you have genuine personal strengths on which you can draw to meet future challenges in your life.

24You have no prior or subsequent matters.  The references tendered attest to your good character.  You are hard-working and valued as an employee, friend, son and husband.  As one of the references indicated, you have remained sensible, down to earth, grounded and humble.

25As to the reason for you being involved I this offending, I was informed that you were aware of the nature of the scheme and your father’s role, that you became involved to please your father and it was part of your cultural disposition to do as your father requested.  In the sentencing remarks relating to your father’s involvement, the learned sentencing judge noted that he exerted considerable influence over you.  You followed both your father’s and WELLS' directions without question.  It was their idea for your to use a false name and you were assisted in setting up the company or business used by them in the scheme. 

26Your counsel submitted that you were not motivated by money or benefits and it was conceded that you were not coerced or tricked into being involved, rather your involvement all stemmed from your loyalty and respect for your father.  The amount that you obtained is difficult to ascertain, as some of the funds to Red Consultancy were controlled by your father or went to managed entities.  It was agreed that you received at least $20,000.   Further it was conceded that approximately $60,000 was available to you (see paragraph 49, Exhibit A) though whether that was accessed by you or others is unclear. 

Plea of guilty, delay, rehabilitation prospects.

27I take into account your plea of guilty.  Your plea warrants a considerable discount in the sentence to be imposed.  I note that the plea was not at the earliest opportunity, as you had a trial scheduled to commence in January next year.  This was a lengthy investigation and the trial would have taken considerable Court time.  No witnesses were required to give evidence.  I accept your guilty plea has significantly facilitated the course of justice and has a utilitarian benefit. 

28Your plea is also indicative of remorse.  The material tendered on your behalf refers to your expressions of remorse in respect of your involvement in this offending.   

29There has been a delay in the finalisation of these matters.  The process began with public hearings at IBAC in 2014.   You were committed for trial in September 2016.  The matter was initially in the County Court, then uplifted to the Supreme Court.  Your father, WELLS and some of the other players pleaded guilty in the Supreme Court during 2017 in respect of their involvement in the fraudulent scheme.  A further delay occurred when this matter was remitted back to the County Court after John Dixon J had sentenced your father and WELLS. 
I conducted a sentence indication hearing on 2 November 2018 and you pleaded guilty to the indictment at the completion of that hearing.  It has been almost approximately four years since you have had this matter “hanging over your head”.   Importantly, you have not re-offended during this time.   

30It was not disputed that you had good rehabilitation prospects and that you were unlikely to re-offend.  Factors relevant to this assessment include that:

·You have the support of family members and friends;

·The impact these proceedings have had on your family and professional life;

·Your previous good character;

·Mr Newton’s view that there is no evidence of antisocial tendencies or other propensities towards criminal behaviour; and

·Your good employment history.

31As to parity with others involved in the conspiracy, the relevant details of their involvement are set out in Exhibit A (see paragraphs 5-9; and 17-26).  I was provided with sentencing reasons in respect of your co-conspirators who have been sentenced.  Three of them pleaded guilty in this court, the others properly categorised as higher up the scale, were sentenced by John Dixon J.  Each of these individuals received varying terms of imprisonment. 

32Given the hierarchy in the scheme, it was not submitted that parity applied.  Clearly WELLS and your father were at the top of the tree, in terms of orchestration of the fraud, period of time involved, significant level of breach of trust, and the financial benefit that they received.  You were not involved in setting up the scheme and did not significantly profit from it, although you did play a key role in the scheme by providing an identity which helped to conceal the fraud.  As previously mentioned, there is some uncertainty as to the amount that you actually obtained through your involvement.  Significant funds went through your business to other managed entities.  SALTER had a higher involvement through his engineering consultancy, providing technical expertise and being involved in the implementation of the scheme.  The prosecution placed you in a similar category to De La Torres, Hayes and Davis.  

Aggravating features

33There were some aggravating features of your offending.  Your involvement in the conspiracy was for three and a half years.

34As described by John Dixon J, the real gravamen or real defrauding of the government interest was the corrupting of the scheme by which tendering was supposed to be carried out.  Honest contractors would have been dissuaded from participating in the tender process.  Your involvement in the panel approving tenders under a false name gave the panel the look of independence, though you did exactly what WELLS and your father requested, awarding contracts to managed entities.   

35Given your good rehabilitation prospects, specific deterrence has a limited role in the sentencing exercise.  General deterrence remains relevant, as although you were not an architect of the scheme, you were prepared to be involved with full knowledge of what was happening and the tainted tender process.  Those who are prepared to participate in the manner in which you did, should be deterred from being involved in such schemes, even at your level, which allowed for the circumvention of the proper and competitive tender of government business.

36Although you participated in a scheme whereby the process for awarding government works and contracts was uncompetitive, it cannot be established that the Government in fact paid higher prices for the relevant works to those managed entities or companies that it otherwise would have paid for, or that there was actual financial loss to the state.

Disposition

37Your counsel submitted that the appropriate sentence was a term of imprisonment that could be wholly suspended.  At the time of your offending, a term of imprisonment that could be suspended in full was available as a disposition.  The prosecution did not submit this course was outside the proper exercise of the sentencing discretion.

38In sentencing you, I take into account all the relevant sentencing considerations, including the objective seriousness of your offending, general deterrence and just punishment, balanced against matters in mitigation, including your plea of guilty and personal circumstances. I am mindful of the matters listed in s.27(1A)(a) of the Sentencing Act in determining that a sentence of imprisonment, wholly suspended, is an appropriate disposition for this offending.

39If you could please stand. 

40In respect of Charge 1, conspiracy to defraud, you are convicted and sentenced to a term of imprisonment of two years.  That term of imprisonment is wholly suspended for a period of two years.

41I am required to inform you that if you breach this order by the commission of another offence punishable by imprisonment in this or other State, that could result in breach proceedings and the matter coming back before me for re-sentence, where my options will be more limited.

42Pursuant to s.6AAA of the Sentencing Act, if you had not pleaded guilty, I would have imposed an actual term of imprisonment of three years. 

43Are there any other orders?

44COUNSEL:  If it pleases the court.

45HER HONOUR:  Thank you.

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