Director of Public Prosecutions v Peters

[2021] VCC 169

IN THE COUNTY COURT OF VICTORIA

 Revised

Not Restricted

Suitable for Publication

AT MELBOURNE

CRIMINAL JURISDICTION

CR 20-01230

DIRECTOR OF PUBLIC PROSECUTIONS

v

JOANNE PETERS

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JUDGE:	HER HONOUR JUDGE WILMOTH
WHERE HELD:	Melbourne
DATE OF HEARING:	12February 2021
DATE OF SENTENCE:	23 February 2021
CASE MAY BE CITED AS:	DPP v Peters
MEDIUM NEUTRAL CITATION:	[2021] VCC 169

REASONS FOR SENTENCE

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Subject: Criminal law - sentence        

Catchwords: Plea of guilty to one charge of theft – breach of trust- more than 60 transactions over 12 months – theft of $200,000 – offender fragile psychologically – offending in 2011-2012 - significant delay of 5 and a half years -      suspended sentence within range.

Cases Cited:Verdins v R [2007] VSCA 102

Sentence: 3 year wholly suspended prison sentence         

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APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Mr A. Grant	OPP
For the Accused	Ms R. Avis	James Dowsley Solicitors

HER HONOUR:

1Joanne Peters, you have pleaded guilty to one charge of theft.  This is a rolled up charge of multiple incidents of theft of $200,000 from your employer over some 12 months between 1 August 2011 and 31 August 2012.  The maximum penalty for theft is 10 years' imprisonment.

2You misappropriated this amount in cash on over 60 occasions and manipulated the accounting records to conceal your misappropriations.  You were employed by Coldflow Pty Ltd, an Australian-owned family business which had traded for more than 50 years.  At the time of the offending, the company was involved in the provision and installation of heating and
air-conditioning appliances in residential and commercial settings.

3You were employed there since July 2011 as the group credit controller on a salary of $88,000 per annum, monitoring and controlling day-to-day running of the accounts department and overseeing payment of customer accounts. Your job was to create new customer accounts, issue invoices and credit existing customers when payments were made.

4In 2011 and 2012, many customers paid their accounts using cash.  These payments were either collected by a salesman as deposits for confirmed orders or by an installer as payment upon completion of the work.  More recently, payments were made electronically or by credit card.  Finance could also be provided through a third party finance company.  The payment would initially be placed in the miscellaneous customer account and later would be placed into the relevant customer account.

5At the end of the day, the cash, including any deposits, was placed into the Coldflow Pty Ltd bank account and the payment allocated to a “job file” set up in a database known as “FileMaker”.  The cash would be handed to the finance officer who would make a handwritten record into a cashbook.  Both the sales person or installer and the finance officer were required to sign the relevant entry in the cashbook.  The cash would then be placed in the office safe until it was later banked.  That occurred after 3 pm each day when the finance officer would reconcile the cash with the job file which had been created in the FileMaker database.

6The finance officer would then highlight and “rule off” the relevant entries in the cashbook and ensure that all the cash received was accounted for.  The banking summary, known as a deposit slip, was then printed and taken to the bank with the cash to be deposited.

7If the customer account had not been set up as a job file in FileMaker when the bank reconciliation occurred, the cash received would be applied to a miscellaneous account.  The funds would later be reallocated to the appropriate customer account.

8You were responsible for the daily banking and you were also solely responsible for organising refunds if a customer had to be reimbursed in the event of an overpayment or if a job was cancelled.

9In August 2012, Andrew Wolf, the Chief Financial Officer, found entries in the accounting system which appeared suspicious.  He asked you about them and you said you could not recall why the entries had been made erroneously.  Mr Wolf gave you the benefit of the doubt but remained cautious and moved you into another role.

10The person who replaced you found further accounting entries which caused her concern and when she raised them with Mr Wolf, he organised another meeting with you.  You gave the same reply as before that you could not remember.  A further discrepancy was discovered in December 2012.  A payment of over $23,000 was made by a finance company on behalf of a client but instead of the payment being applied to that customer's account, it had been applied to three other unrelated customer accounts.

11You took part in another meeting with Mr Wolf attended by others as well.  They told you that over $200,000 appeared to be missing.  You conceded that you had stolen money from the company and had used it to help others, to help pay back money borrowed from your parents and to pay for a back operation for your mother.  You explained the methods you had used to steal the money and you agreed to repay it.

12On 14 December, you attended a meeting with staff from the company and signed a deed of acknowledgment which contained your admissions, your agreement to repay the money and your agreement to give Coldflow a charge over your family home to secure the repayment.

13You had paid $20,000 to the company the previous day and paid a further $10,000 in the following weeks.  The company lost contact with you and instructed its lawyers to lodge a caveat on your house.  The matter was reported to the police with the investigation beginning on 13 February 2013.

14You placed the family home on the market in December 2012 and it sold in February 2013 with the settlement taking place in June of that year.  From the proceeds, you repaid a further $32,360.40 to Coldflow making a total of $62,360.40 in repayments.

15A detailed investigation of the company's accounting records was began by staff which took several years to complete involving a detective and a Victoria Police forensic accountant and revealing a discrepancy of over $200,000.

16Some entries made by you had the effect of understating the sum of cash that had been collected by customers.  Other methods included the misuse of a credit card belonging to a customer resulting in the substantial loss to that customer as well as other means involving the misuse of cash.  These are set out at paragraph 36 of the prosecution opening and I will note that in a footnote to this paragraph[1].

[1] [1] (1) The misuse of the DJ Rice account.

17Your bank account records obtained by police revealed that at the relevant times a total of $72,362 was paid into accounts operated by you and your husband with a total of 342 cash withdrawals.  A total of $14,100 was placed into accounts operated by your parents and a total of $1,480 was paid into your son's account.  The sum of $47,840 was withdrawn in 244 transactions at gaming venues.  A further $33,032 was withdrawn from ATMs and bank branches and a further $28,350 cash was withdrawn from credit card accounts held by you and your husband.

18You were contacted by the police almost six years later, in August 2018, to be interviewed and this took place on 23 October 2018.  You were charged on 27 April 2020.

19Coldflow was insured and were refunded the funds that you misappropriated after they had paid an excess of $10,000.  The company was also out of pocket after incurring expenses and costs including legal fees in their efforts to recover their losses.

20Mr Wolf provided a victim impact statement which he read aloud to the court describing a very difficult time for him as the Chief Financial Officer and for the company's owners confronted by your deceit and dishonesty.  He said the reconstruction of the accounting records took over two years, at significant expense and disruption.  His attempts to contact you after you moved from your house was stymied when you did not answer his calls and did not provide him with new contact details, leading him to believe that you had no remorse.

21Ms Angelakos was a staff member whose tasks included daily reconciling of bank statements.  When she discovered discrepancies and asked you about them, she accepted your replies that it was an honest mistake made in haste.  She stated in her victim impact statement that she felt you betrayed her trust in you and as a personal friend of yours, she felt it might have looked as though she was involved.

22Ms Angelakos undertook the reconstruction work which took years and required her to work after hours and on weekends.  She said she felt sick to the bone at your breach of trust, particularly given that you had started to steal very soon after you started your employment there.

OBJECTIVE GRAVITY OF THE OFFENDING

23That observation by Ms Angelakos as to breach of trust is fundamental to weighing the gravity of your offending.  You were an experienced worker in the field and knew full well what your responsibilities were.  You carried out over 60 misappropriations over 12 months attended by significant planning and organisation.  It was not spontaneous; indeed, it was regular and systematic and you succeeded in concealing your actions for the duration.  As Mr Wolf and Ms Angelakos said the deleterious impact on the business was very significant.

24It follows that the need for general deterrence should be reflected in the sentence, given also that this is a crime that is generally easy to commit, difficult to detect and often committed by a person in a position of trust who is of otherwise good character.

25The need for specific deterrence is reduced somewhat by several matters which I shall turn to now.

PERSONAL BACKGROUND AND CIRCUMSTANCES

26You are a 51-year-old married woman with two adult married children.  Before your employment with Coldflow, you worked for the ANZ Bank for 15 years.  You have no prior convictions and have been a person of good character until this offending.  A reference from your friend, Alison High, confirms her regard for you, to the extent that after you told her what you had done, she employed you in her construction business for two years, until a further opportunity for you arose for a job in administration, but with no financial responsibility.

27You are close to your parents and as they have aged, they have become very dependent on you, with your father suffering from dementia and your mother having a back problem which required surgery.  You provide them with daily support and support in the case of an emergency.  Following your mother's surgery in 2011, she developed an addiction to the analgesic medication Endone.  It appears that your fear of such an outcome has led you to avoid any medication, despite a recent fall resulting in a substantial and painful injury to your ankle requiring physiotherapy.

28You were assessed recently by the psychologist, Mr Patrick Newton, who provided a report.  He diagnosed persistent depressive disorder with a wide range of symptoms and depressed mood disturbances since childhood as well as bouts of suicidal ideation.

29Mr Newton noted that you have avoided both medical and psychological treatment and this may have exacerbated your suffering.  He considers it likely that you were experiencing the effects of this disorder of relatively mild intensity at the time of the offending but thereby compromising your cognitive clarity and decision making.  He formed the opinion that your good intelligence should be an asset in assisting your rehabilitation.

30Your motive for the offending may have had its genesis in the need to help pay for your mother's surgery, but also to provide funds for your husband's gambling at the time, something which you joined in, in order, you have explained, for the two of you to take part in an activity together.  This appears to have followed your reconciliation, after the marriage was threatened by your husband's affair with your close friend. Your sister then took his part, resulting in the continuing estrangement of you and your sister.

31You stopped gambling about five years ago and from your new employment you are earning about $60,000 a year and are living in rental accommodation.  You have paid $63,000 to Coldflow and you are making arrangements to repay the outstanding amount.

MITIGATING FACTORS

32Your plea of guilty at a very early stage, avoiding the need for any witnesses to give evidence, and avoiding what would have been quite a long and complex trial, mean that you are entitled to a discount on your sentence.  It has been of assistance to the court and to the criminal justice system, particularly at a time when the COVID crisis has created an extensive backlog of cases.

33Your plea can be accepted also as an indication of remorse, and I accept that you are sorry.  It took several meetings with management before you admitted to having stolen the funds, and later when communication between you and Mr Wolf stalled, it was perhaps unsurprising that he concluded you were not remorseful.

34While there is little direct evidence of remorse, your attempts at repayment and your intention to pursue it do reflect a remorseful attitude.

35Your psychological frailty means that your experience of prison would be very difficult, more so than for others who are more robust.  It follows that Limbs 5 and 6 of the Verdins principles apply and I take that into account.

36I also note that to be imprisoned at this time, you would have to undergo 14 days of quarantine, isolated from others and that the other COVID restrictions which apply in prisons currently would mean you could have no visits and be deprived of opportunities to engage in any programs.

37The most significant factor to be weighed in this sentencing exercise is that of delay.  Indeed, it tips the balance in this case.  The offending took place nearly 10 years ago.  You made admissions in 2012 but you were not interviewed until 2018 and you were not charged until 27 April 2020.  Even taking into account the time needed for the investigation, that is an inordinately long delay during which it stands to reason you would have experienced significant stress and anxiety.  It is accepted that delay can be a strong mitigating factor for that reason as the authorities stipulate, and deserves a considerable reduction in sentence.

38You have no prior convictions and you have not reoffended since then, and you have continued to be employed with different duties.  Your prospects for rehabilitation appear to be good, particularly if you engage in appropriate psychological treatment.

39The sentencing submission of your counsel was for a suspended prison sentence, a disposition which was still available at the time of the offending, although it no longer is.  Indeed, there is authority supporting such a disposition in appropriate cases and it would not have appeared as an unusual outcome if you had been sentenced close in time to the offending.

40I was referred to a number of decisions of the Court of Appeal representing a range of offending and resulting sentences, with none particularly similar to this case.  The prosecution submission on sentence was that a suspended sentence either wholly or in part is within range.

41Ms Peters, for the reasons I have set out, I sentence you to three years' imprisonment to be wholly suspended for three years.  It means that if you offend in any way such as to attract a prison sentence, you will have breached that sentence and must return to the court to be resentenced.  Do you understand that?

42ASSOCIATE:  Just coming off mute, Your Honour.

43HER HONOUR:  Yes.  All right.  Thank you.

44Now, Mr Grant, I am just not clear whether s.6AAA applies.  I cannot remember now whether that is the case with a suspended sentence.  Can you confirm that?

45MR GRANT:  It does, Your Honour, in my submission.

46HER HONOUR:  All right.  Thank you.

47If you had pleaded not guilty to this charge, I would have sentenced you to three years' imprisonment with two years suspended.

48Now, Mr Grant, is there anything I have neglected or omitted?

49MR GRANT:  No.  Thank you, Your Honour.

50HER HONOUR:  Thank you.  Ms Avis, is there anything further?

51MS AVIS:  No.  Thank you, Your Honour.

52HER HONOUR:  I will leave the Bench now.  I will leave the link open in case, Ms Avis, you need to speak to Ms Peters about anything.

53MS AVIS:  Thank you very much.

54MR GRANT:  If Your Honour pleases.

55MS AVIS:  As the court pleases.

‑ ‑ ‑

You used the credit card details of DJ Rice, a commercial customer, to pay funds into other customers’ accounts, from which you had appropriated cash. When DJ Rice went into liquidation the liquidators identified and recovered $85,000 that had been paid to Coldflow, which included a number of unauthorised payments processed by you using the credit card details.

(2) Misuse of the Miscellaneous Customer Account

After misappropriating cash paid by customers, you transferred funds in this account into the accounts from which the cash had been taken.

(3) Misuse of payments made under finance contracts

Payments made by a finance company would be initially placed into the Miscellaneous Customer Account, before being transferred into the relevant customer account. You transferred funds from that account into customer accounts from which you had misappropriated funds.

(4) Misuse of credit notes

Where a regular customer had a credit in their account, you would on occasion transfer funds from there into the account of a customer who had paid cash, and whose funds you had misappropriated. On occasion, you fraudulently created a credit note and applied it to a previous customer. You would then transfer funds from that customer account into the accounts of customers who had paid cash which you had appropriated.