DPP (Cth) v Couper
[2013] VSCA 72
•10 April 2013
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCR 2012 0163
| DIRECTOR OF PUBLIC PROSECUTIONS (CTH) | Appellant |
| v | |
| PETER JOHN COUPER | Respondent |
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| JUDGES | HARPER and TATE JJA and WILLIAMS AJA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 16 November 2012 |
| DATE OF JUDGMENT | 10 April 2013 |
| MEDIUM NEUTRAL CITATION | [2013] VSCA 72 |
| JUDGMENT APPEALED FROM | (Unreported, County Court of Victoria, Judge Gaynor, 29 June 2012) |
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Criminal Law – Sentence – Appeal by DPP (Cth) – ‘White collar crime’ – Respondent pleaded guilty to charges in contravention of ss 1307(1) and 1309(1) of the Corporations Act 2001 (Cth) and s 64(1) of the Australian Securities and Investments Commission Act 2001 (Cth) – Respondent sentenced to total effective sentence of 21 months imprisonment, to be released upon giving security by recognisance of $1,000 on the condition that he be of good behaviour for period of 3 years together with a fine of $10,000 – Whether sentence manifestly inadequate – Repeated instances of dishonesty over protracted period of time – Moral culpability and general deterrence – Respondent instructed innocent employees to record unlawful transactions – Respondent gave false and misleading information to auditor and in course of ASIC examination – Respondent otherwise of good character – Not reasonably open to sentencing judge to impose wholly suspended sentence.
Sentencing – Whether sentencing judge had power to impose multiple recognisance release orders under s 20(1)(b) of the Crimes Act 1914 (Cth) – Sentencing judge fell into error and should have ordered only a single recognisance period.
Sentencing - Discounts under s 21E of the Crimes Act 1914 (Cth) and s 6AAA of the Sentencing Act 1991 (Vic) – Sentence reduction for each separate factor to be identified – Actual combined reduction to be identified – Appeal allowed – Respondent re-sentenced to total effective sentence of one year and 10 months imprisonment commencing on 29 June 2012 – Respondent to serve 60 days imprisonment commencing from today’s date, pay fine of $10,000 and be of good behaviour for a period of two years commencing on 29 June 2012.
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| Appearances: | Counsel | Solicitors |
| For the Director | Mr D D Gurvich | Solicitor for the Commonwealth Director of Public Prosecutions |
| For the Respondent | Mr P A Dunn QC with Mr L C Carter | Mills Oakley Lawyers |
HARPER JA:
I have had the benefit of reading, in draft, the judgment of Tate JA. I agree with the orders proposed by her Honour, and with her reasons for proposing them. In addition, I wish to specifically associate myself with her Honour’s exposition of the procedure to be followed when formulating a sentence in which reductions have been made to reflect the impact on the sentence of s 21E of the Crimes Act 1914 (Cth) and s 6AAA of the Sentencing Act 1991 (Vic).
TATE JA:
Introduction
This is an appeal by the Commonwealth Director of Public Prosecutions (‘the DPP’) against the alleged manifest inadequacy of a sentence imposed upon Peter Couper (‘the respondent’) in respect of two charges of falsification of books affecting or relating to a company, contrary to s 1307(1) of the Corporations Act 2001 (Cth); one charge of authorising, or permitting, or making available, or the giving of, misleading information to an auditor, contrary to s 1309(1) of the Corporations Act; and one charge of giving false or misleading information in a material particular in the course of an examination by the Australian Securities and Investments Commission (‘ASIC’), contrary to s 64(1) of the Australian Securities and Investments Commission Act 2001 (Cth) (‘the ASIC Act’). The respondent pleaded guilty to all four charges. He was sentenced to a total effective sentence of 21 months’ imprisonment, and released forthwith upon giving security by recognisance of $1,000 on the condition that he be of good behaviour for a period of three years together with a fine of $10,000.[1] He was not given an immediate custodial sentence.
[1]DPP (Cth) v Couper (Unreported, 29 June 2012, County Court of Victoria (Judge Gaynor) (‘Sentencing remarks’).
In addition to the complaint of manifest inadequacy, the DPP also complains that there were various inconsistencies in the terms of the orders.
More particularly, the respondent was sentenced in the County Court[2] as follows:[3]
[2]On 29 June 2012, following a plea on 7 and 8 June 2012.
[3]Sentencing remarks, [53]-[57].
Charge on Indictment
Offence
Maximum
Sentence
Cumulation
Charge 1 Falsification of books affecting or relating to a company
[Corporations Act 2001 (Cth) s 1307(1)]2 years’ imprisonment and/ or fine of $11,000
[Corporations Act 2001 (Cth) s 1307(1) and Schedule 3]12 months’ imprisonment, to be released forthwith on recognisance of $1,000 to be of good behaviour for 3 years. Sentence to commence on 29 June 2012. Charge 2 Falsification of books affecting or relating to a company
[Corporations Act 2001 (Cth) s 1307(1)]2 years’ imprisonment and/ or fine of $11,000
[Corporations Act 2001 (Cth) s 1307(1) and Schedule 3]12 months’ imprisonment, to be released forthwith on recognisance of $1,000 to be of good behaviour for 3 years. Sentence to commence on 29 September 2012. Charge 3 Authorising or permitting the making available or giving of misleading information to an auditor
[Corporations Act 2001 (Cth) s 1309(1)]5 years’ imprisonment and/ or fine of $22,000
[Corporations Act 2001 (Cth) s 1309(1) and Schedule 3]12 months’ imprisonment, to be released forthwith on recognisance of $1,000 to be of good behaviour for 3 years. Sentence to commence on 29 December 2012. Charge 4 Giving false or misleading information in a material particular in the course of an examination
[Australian Securities and Investments Commission Act 2001 (Cth) s 64(1)]2 years’ imprisonment and/ or fine of $11,000 [Australian Securities and Investments Commission Act 2001 (Cth) s 64(1)] 12 months’ imprisonment, to be released forthwith on recognisance of $1,000 to be of good behaviour for 3 years. Fined $10,000. Sentence to commence on 29 March 2013. Total Effective Sentence: 21 months’ imprisonment, to be released forthwith upon giving security by recognisance of $1,000 on the condition that he be of good behaviour for a period of 3 years.
Fined $10,000.Non-Parole Period: N/A Pre-sentence Detention Declared: N/A 6AAA Statement: 21 months’ imprisonment, with 18 months suspended for a period of 3 years. S 21E Crimes Act 1914 (Cth): 24 months’ imprisonment Other orders:
3 month stay on fine.
The charges arose from an investigation conducted by ASIC when the respondent was the Chief Financial Officer (‘CFO’) of a publicly listed company, the On Q Group Limited (‘On Q’), the parent company of Bill Express Limited (‘BXP’). The business conducted by BXP included telephone technology; its electronic network provided the platform for the delivery of bill payment services, and the delivery and distribution of prepaid telephony products, in store digital media and advertising, along with a prepaid visa card.
Charges 1, 2 and 3 relate to conduct engaged in by the respondent, between August 2007 and February 2008, which resulted in a series of false records of transactions being recorded on BXP’s accounting system.[4] The transactions purported to relate to the purchase and sale by BXP of Simix stock. The Simix product was designed to be a pre-loaded SIM card technology that allowed the users to control the amount spent on SIM cards per user per day. However, at relevant times, there was no Simix stock in existence because it remained a product in development. No Simix stock was ever delivered to BXP and no sale of Simix stock ever took place. The respondent knew that.
[4]The statements of fact are taken from the Prosecution Opening (Exhibit 2 on the plea) that was accepted by the respondent and annexed to the judge’s Sentencing remarks.
The existence of these false transactions in BXP’s accounting system resulted in BXP:
(1) recording an additional profit of $3.525 million for the financial year ended 30 June 2007 in relation to Simix stock transactions when in fact no profit had been made; and
(2) recording an additional profit of $3.525 million for the half-year ended 31 December 2007 in relation to Simix stock transactions when in fact no profit had been made.
Charge 4 relates to false and misleading answers the respondent gave to ASIC during examinations it conducted on or about 20 June 2008 and 26 March 2009, under s 19 of the ASIC Act, in relation to the investigation ASIC was conducting into suspected contraventions of s 1041A (market manipulation); s 1041B (false trading and market rigging – creating a false appearance of active trading); and s 1041C (false trading and market rigging – artificially maintaining trading price) of the Corporations Act in relation to trading in BXP shares.
The offending took place in the context of the global financial crisis that had an adverse financial effect on On Q, in particular, BXP, because BXP had borrowed heavily to finance a large extension in its activities in the early 2000s’. Indeed, it was said that at the time the offences were committed, On Q was ‘haemorrhaging money’.
In 2004 On Q was floated on the Australian stock exchange. On Q was placed in administration in 2008 and eventually wound up. At that time, it operated an electronic network of approximately 14,000 terminals around Australia.
The respondent was employed by On Q as its CFO as a result of working for Australian Pure Fruits Limited, a company which made cordial, tomato juice and fruit juice. Australian Pure Fruits Limited was largely owned by Peter McDougall. Peter McDougall became a director of On Q when Australian Pure Fruits Limited was taken over by On Q.
Harold (Hal) Christiansen was a director of BXP from 21 October 1999 to 30 June 2008. He passed away on 1 July 2008. He was the Joint Managing Director of BXP from 1999 to 2005 with Peter McDougall. Following a dispute with McDougall, Hal Christiansen stepped aside from that role in 2005. However, until 1 July 2008 he continued to have a role at BXP being responsible for new IT opportunities and international business. Ian Christiansen, Hal’s brother, was appointed Chief Executive Officer at BXP in 2005.
Charge 1: falsification of books - sale of non-existent Simix stock to ETT and subsequent assignment to APS
The accounting system of BXP was known as ‘End2End’ and included the general ledger, invoicing and payment systems. Entries were made into the system by various officers and employees of BXP, either by manually entering the journal entry or entering the journal entry into an Excel spreadsheet and then importing the spreadsheet into End2End.
The exclusive rights in Australia and New Zealand to Simix technology were held by Inter Linear Technology Pty Ltd (‘ILT’).
On about 13 June 2006, Tom Curtain, the director of ILT signed a memorandum of understanding for the supply to BXP by ILT of Simix enabled SIM cards. Subsequently, BXP purportedly agreed to purchase from ILT 25,000 Simix enabled SIM cards at $75.00 each. ILT issued an invoice dated 27 September 2006, Invoice No: 270906, to BXP for the total amount payable of $2,062,500. The respondent was involved in these transactions. The invoice was marked to his attention.
Pursuant to the purchase agreement, payment was arranged through a loan facility BXP had with a company called CCH Europe GmbH (‘CCH’). The respondent managed the facility through CCH representative Charles Ridley, and would provide BXP accounting staff with details on all CCH transactions. On 1 December 2006 ILT received $2,022,849.02 from CCH in payment for Invoice No: 270906.
The respondent explained, after his committal, that the intended purpose of the purchase agreement between BXP and ILT was to raise funds for both BXP and ILT rather than to purchase stock. He further said the funding was intended to allow ILT to develop the Simix product. At the time he knew that Simix was a product still in development. He knew that there was no Simix stock in existence and he knew that no Simix stock was ever delivered to BXP. The funding would be obtained from CCH. CCH's practice was to provide funding for stock purchases, but not for product development. The respondent said that he advised Hal and Ian Christiansen that CCH would not fund product development.
The respondent said the purchase agreement was also intended to provide capital funding for BXP. It was intended that the greater portion of the funds obtained from CCH by ILT would be received by BXP.
In February 2007 BXP accounting staff identified an amount of $1,875,000 worth of Simix stock recorded as inventory in BXP’s general ledger balance sheet. In March 2007 this item was also identified by KPMG who were the auditors of BXP.
When BXP CFO Marc Lichtenstein asked the respondent about the stock, the respondent said:
Don’t worry about it, it will be gone by June.
The respondent provided Lichtenstein with a similar assurance the following month.
In a KPMG report entitled ‘Internal Controls Review’ dated May 2007, it was noted in relation to the Simix stock that:
There is potential that the stock does not exist, is understated, is wrongly valued or incorrectly classified as stock held for sale.
On 5 August 2007 the respondent sent an email to Marc Lichtenstein with a subject line entitled ‘BXP June Results’. The email contained a list of instructions for Lichtenstein to attend to in relation to journal entries for the 30 June 2007 financial statements for BXP. It included an instruction to sell the Simix stock to another company, ETT Limited (‘ETT’):
Invoice ETT for the sale of the Simmex [sic] stock of $1.8m for $5.4m plus GST. This ties in with the subsequent event in the Annual Report for March 2007, where the company has developed the platform for processing.
The following day, Lichtenstein forwarded the email to BXP finance team members Rosey Moloney and Anpu Kanthasamy, requesting that they attend to this item.
On 7 August 2007, Moloney processed a number of journal entries into the accounting system of BXP pursuant to these instructions, so as to: (1) record a sale of $5.4 million worth of Simix stock to ETT with the effective date of 30 June 2007; and (2) transfer the stock to the ‘cost of goods sold account’ with an effective date of 30 June 2007, the cost of Simix stock sold being recorded as $1.875 million.
Moloney made entries so as to generate customer Invoice No: 16378701 to ETT in the sum of $5,400,000 plus GST, with an invoice value of $5,940,000.
As the transaction was backdated to 30 June 2007, the value of the transaction was shown in the BXP financial accounts for the year ending 30 June 2007. Accordingly, when on 15 August 2007, Lichtenstein prepared a draft file note for BXP’s board and executive staff in relation to the significant items in BXP’s consolidated profit for the year ending 30 June 2007, he was able to state:
At 30 June 2007 Bill Express [BXP] has sold its Simix stock to ETT Limited for $5.4 million. This stock was carried in the books of Bill Express at $1.8 million. Accordingly Bill Express has made a profit of $3.6 million from this transaction.
However the chairman of ETT, Larry Shutes and, later, ETT’s CFO, Aliceson Rourke, refused to confirm and make book entries relating to the purchase of Simix stock from BXP.
On 7 August 2007, Moloney sent an email to Shutes, in relation to the purchase of Simix stock by ETT. Attached to the email was a copy of the Simix stock customer invoice to ETT. The email also requested that Shutes return a ‘clean email’ agreeing that ETT owed BXP $5.94 million as at 30 June 2007.
Shutes did not reply to the email or provide the confirmation as requested as ETT had never purchased Simix stock from BXP. He spoke to the respondent and told him this.
On 27 August 2007, Lichtenstein sent Shutes an email requesting that he complete a debt confirmation letter for the outstanding debt and loan balances as at 30 June 2007. Shutes forwarded the email to another director of ETT, Gordon Tudor. Shutes then telephoned Tudor to ask if he had any knowledge of the Simix debt amount of $5.94 million. Tudor responded by saying that ETT had not bought any Simix stock, and said, inter alia, words to the effect of:
… You deal with it, I know nothing about this, … we are a listed company, and as directors we cannot be doing things like this …
On 30 August 2007 Shutes sent an email to the respondent in which he stated:
Hi Peter
I said I would attend to this and send you a copy, (sorry it went into yesterday I forgot file). Mate I want to help as I will again need your help as we go forward and run into our half-year accounts in the next month. However I am not fond of porridge. Give me an easy way forward and will try and help.
Regards
Larry
The respondent subsequently re-presented the invoice to ETT. On 1 October 2007 Aliceson Rourke sent an email to the respondent and requested copies of the invoices issued by BXP to ETT for the period June 2007 to September 2007. At the time she was in the process of collating material for ETT’s financial report for the half-year ended 30 September 2007. The respondent replied to Rourke’s email on 4 October 2007 attaching invoices from BXP for the relevant period, including the invoice to ETT for $5.4 million of Simix stock.
This was the first time Rourke became aware of the product called Simix. She discussed the respondent’s email with Shutes, and sent an email to the respondent on 5 October 2007 which stated:
Thank you for the invoices, however I will not be booking the $5.9 million sale of Simix stock as I know full well that Larry did not agree to accept that charge.
The respondent replied by email:
That’s fine.
Subsequently the respondent engaged in conduct to assign the sale of Simix stock from ETT to Alternative Payment Solutions (‘APS’). On 18 February 2008, the respondent sent an email to BXP’s CFO Sean Slattery[5] instructing him to arrange entries on BXP's accounting system to credit the sale to ETT and re-invoice APS for $5.4 million of Simix stock. APS is a Dubai-based company and Charles Ridley was its principal at the time of the respondent’s offending. As mentioned above, Ridley was also involved with CCH.
[5]It would appear that by February 2008 Sean Slattery had become BXP’s CFO replacing Mr Lichtenstein.
In turn Slattery by email requested that Moloney arrange the credit of the ETT invoice and re-invoice the sale to APS. These entries were made on 19 and 20 February 2008 by BXP accounting staff Moloney and Jessica Jonathon. This involved Jonathon generating in the accounting system of BXP: (1) a Credit Note 7227 to ETT dated 19 February 2008; and (2) Invoice No: 19169796 to APS for the sale of $5.4 million of Simix stock, thereby transferring the sale from ETT to APS.
On 20 February 2008 Moloney processed further journal entries in the accounting system of BXP to backdate the transaction to 31 December 2007. The effect of these entries was that the transaction would be now recognised in the BXP financial accounts for the half-year ending 31 December 2007.
Charge 2: falsification of books – recording purchase of non-existent Simix stock from ILT and sale to APS
A sale of non-existent Simix stock to APS formed the foundation of charge 2.
On 22 December 2007, Ian Christiansen sent an email to the respondent and the company solicitor, Leath Nicholson, which contained a list of tasks to complete for that month. One of the tasks was headed ‘Simix Stock sale ($5 million sale where stock will cost $1 million)’ and entailed that the respondent was to invoice for the sale of the stock, and to obtain a supplier invoice ‘for the purchase’. This was achieved as follows:
(1) On 24 December 2007, BXP’s accounts receivable supervisor, Erin Kennedy, processed an invoice in the BXP accounting system for the sale of Simix stock valued at $5.4 million to APS. The invoice generated was Invoice No: 18389913 addressed to APS, dated 24 December 2007. Sean Slattery believed that the instructions to generate the invoice came from the respondent.
(2) On the same day, the respondent by email instructed BXP accounting staff member Ajit Nadarajah to process on BXP's accounting system a supplier invoice, described by the respondent as Invoice No: 201207, from ILT for $1.875 million worth of Simix stock. Nadarajah did not see an actual supplier invoice from ILT. However, pursuant to these instructions, on 27 December 2007, he processed a supplier invoice from ILT for a purchase of $1.875 million of Simix stock. On 27 December 2007 he also replied to the respondent's email of 24 December 2007 to say that he had carried out the instruction. ILT did not make any sale of Simix stock to BXP (other than, as mentioned above,[6] the purported sale of 25,000 Simix enabled SIM cards pursuant to Invoice No: 270906 dated 27 September 2006 in circumstances where there was no Simix stock ever delivered to BXP).
(3) On 14 January 2008, the respondent had discussions with Anpallakan Kanthasamy, a financial accountant with BXP, in relation to the $1.875 million worth of Simix stock that appeared on the BXP balance sheet as at 31 December 2007. The respondent directed Kanthasamy to transfer the Simix stock on the accounting system to ‘Cost of Goods Sold’. On the same day Kanthasamy processed a journal entry to transfer the $1.875 million worth of Simix stock to the ‘Cost of Goods Sold’ account. On the respondent’s instructions Kanthasamy backdated the entry to be effective on 31 December 2007 (allowing the amount to be recognised as an expense in the accounts for the half-year ending 31 December 2007).
[6]See [15] above.
The recording in BXP’s accounting system of the sale of Simix stock to APS for $5.4 million on 24 December 2007 and the processing of the journal entry in relation to the $1.875 million worth of Simix in the ‘Cost of Goods Sold’ account resulted in BXP recording an additional profit of $3.525 million for the half-year ended 31 December 2007 in relation to that transaction.
Charge 3 – misleading information to an auditor – false information given to KPMG
On 2 January 2008, Ian Christiansen by email provided to BXP’s auditors, KPMG, a report in relation to BXP's financial results for the half-year ended 31 December 2007, which referred to the sale of Simix stock to APS for $5.4 million.
On or about 7 February 2008, a meeting was held between KPMG and BXP in relation to the review prepared by KPMG of the interim consolidated report of BXP (‘the 2007 review’). At that meeting Ian Christiansen advised that the sale of Simix stock recorded in BXP's report was a ‘standard sale transaction’ and ‘no formal contract existed’. KPMG noted that it would require confirmation of the debt as at 31 December 2007.
On 13 February 2008, Melissa Choon (senior accountant with KPMG), emailed Sean Slattery and requested that BXP obtain confirmation from ETT and APS of the debts to BXP for the Simix stock. Choon’s email attached draft letters of confirmation for both ETT and APS.
On 14 February 2008, the respondent told Slattery that the $5.4 million worth of Simix stock purchased by ETT had been transferred to APS along with the obligation of the debt to BXP.
On 15 February 2008, Slattery emailed the respondent in relation to ETT’s debt, and having stated that information was required for the auditors, KPMG, asked the respondent for details of the assignment of the debt to APS.
On 18 February 2008 the respondent responded to Slattery by email and advised:
(1) ETT had purchased Simix stock from BXP in 2007;
(2) ETT provided full confirmation of the debt for the financial year 2007 audit ‘as per the attached acknowledgement letter’;
(3) late in 2007 ETT indicated that it no longer had a need for the stock;
(4) he had negotiated for APS to take the Simix stock and to have the $5.4 million debt assigned from ETT to APS;
(5) an acknowledgement of the debt would be made from APS directly to KPMG; and
(6) APS had committed to pay $3 million to BXP.
This information was subsequently confirmed in an oral discussion between the respondent and Slattery. However, although referred to in the email, no ‘acknowledgement letter’ was attached to the email; and despite numerous requests to the respondent, Slattery was not provided with, nor sighted, a copy of the purported acknowledgement letter.
In fact, ETT never assigned the debt to APS as it says that the debt never existed for it to assign.
It was subsequent to the respondent’s sending the email on 18 February that he emailed Slattery instructing him to arrange entries on BXP's accounting system to credit the sale to ETT and re-invoice APS for $5.4 million of Simix stock as referred to in charge 1.[7]
[7]See [35] above.
As a result of the transactions outlined above, $11.34 million was now recorded in the accounting system of BXP as owed by APS for sale of Simix stock. Following the processing of the credit note to ETT and re-invoice to APS, KPMG formed the view that it no longer required confirmation of the $5.4 million recorded in the accounting system of BXP as owed by ETT to BXP, as confirmation from APS of the entire debt of $11.34 million would be sufficient evidence of the assignment.
Accordingly KPMG as part of the half-year review of BXP’s accounts for the period ending 31 December 2007 required a confirmation from APS of this debt.
On 19 February 2008 Slattery requested that the respondent obtain confirmation of the debt from APS and he followed up that request with a further email on 24 February 2008.
On 28 February 2008 Ridley of CCH emailed KPMG and the respondent a copy of a signed confirmation letter from CCH. However, although the letter stated that APS would make payments to BXP, the letter was unclear as to whether the liability of APS to BXP would be extinguished in relation to the payments, or alternatively whether CCH was simply providing a finance facility to BXP.
At the BXP Audit Committee meeting on 29 February 2008, KPMG asked Slattery to ensure that a confirmation be sent to CCH/APS ‘outlining the fact that payment via the Bill Express Payments entity would not create any liabilities for Bill Express’.
On or about 6 March 2008, a payment of approximately US$2 million was received from CCH, via Bill Express Payments. Slattery advised various members of the BXP Audit Committee of this by email. However, APS made no subsequent payments.
On 29 February 2008, the financial statements of BXP for the half-year ended 31 December 2007 were approved. The financial statements showed a net loss before tax (‘NLBT’) for the half-year of $3.041 million for the BXP consolidated entities.
Without the recorded profit on the sale of Simix stock of $3.525 million, the loss for the half-year would have been more than double than that recorded for the BXP consolidated entities for the period, amounting to a loss of $6,566,000.
Charge 4 – giving information that was false or misleading in a material particular in the course of an ASIC examination
On 20 June 2008, 26 March 2009, and 30 March 2009, the respondent, accompanied by his solicitor George Morgan, attended the s 19 examinations at ASIC’s offices at 120 Collins Street Melbourne.
He was asked questions relating to people communicating with him as to the purchase of BXP shares; providing funding for BXP shares; and the providing of instructions to Newton Chan (‘Chan’), a share trader, to enter bids onto the market for BXP shares.
During the course of the s 19 examination on 20 June 2008 the respondent provided the following responses, amongst others, when answering questions in relation to people communicating with him as to purchases of BXP issues:
Question: Does anyone communicate with you in relation to their purchases of Bill Express shares?
Answer: Privilege. No.
Question: Does anyone communicate with you specifically about their purchases of Bill Express shares?
Answer: Privilege. Quite a few of those people I know who have got shares in Bill Express and On Q.
Question: Do they report back when they purchased shares?
Answer: Privilege. No, no. Privilege. I am aware because I do see the Computershare share listing.
Question:Does anyone in that line, just for clarity, report to you or advise you of shares they may have purchased in a company name?
Answer: Privilege. I wouldn't know if someone was buying shares in a company name.
Question:Yes, I mean has anyone informed you that they have been buying shares in a company name?
Answer: Privilege. No.
Question: And by ‘shares’ I mean Bill Express shares?
Answer: Privilege. No.
An analysis of email records, telephone records and the evidence of Chan and others indicated that the information provided by the respondent was false or misleading. For the period 15 June 2006 to 27 March 2008 the respondent received a number of email notifications from both Chan and Enzo Di Donato of their respective BXP share purchases. (Di Donato was the sole director, secretary and shareholder of 3-D Salesforce Pty Ltd which held a share trading account with Macquarie Equities Limited (‘MEL’) in the company’s name (‘the MEL 3D Salesforce trading account’.)) In these emails Chan advised the respondent of BXP shares purchased on his personal account and Di Donato advised the respondent of the BXP shares he purchased on the MEL 3D Salesforce trading account. Many of these emails also requested funding for the share purchases of which the respondent was being notified.
The respondent was also asked on 7 June 2008 whether he had ‘any involvement whatsoever in funding of other people or other parties purchases’ of BXP shares to which he answered: ‘Privilege. No.’[8]
[8]In fact, counsel paraphrased the question by saying: ’And do you have any involvement whatsoever in funding of other people or other – entities, not parties.’
The analysis of email records, financial records, and evidence of Chan and other MEL employees indicated that the information provided by the respondent was false or misleading. That analysis showed that the respondent had the following involvement in the funding of BXP share purchases:
(1)funding BXP purchases on the Chan account;
(2)funding BXP purchases on the 3D Salesforce account; and
(3)being involved in the use of funds acquired from the sale of BXP shares and rectifying amounts that were dishonoured.
During the course of the s 19 examination on 26 March 2009 the respondent was asked questions about providing instructions to Chan or any other MEL staff to enter bids onto the market for BXP shares to which he responded: ‘Privilege. No.’
Telephone records, evidence provided by Chan and other MEL staff, and analysis of emails indicated that the information provided by the respondent was false or misleading. It was revealed that the respondent and Ian Christiansen were in telephone contact with Chan during and close to the time at which Chan arranged for orders to be entered for BXP shares on the account in both Chan’s and his mother’s name, the MEL 3D Salesforce trading account, and others. The majority of orders placed during a short time after telephone calls from the respondent to Chan increased the share price of BXP.
The purpose of the exercise was to keep up the price of the BXP shares so that no margin call would be made on them, the directors of On Q having entered into three separate margin loan arrangements with Chimaera Capital Ltd, Opes Prime Stockbroking Limited, and Tricom Securities Lending & ShortInvest respectively. The total funds provided to On Q across the three margin loans was approximately $9.3 million.
Chan also confirmed that the respondent and Ian Christiansen gave all trading instructions on his personal account and the MEL 3D Salesforce trading account.
The records also revealed that in January 2008 Chan went on an overseas trip, and advised another colleague, MEL client adviser Matthew Cryer that the respondent was the contact for the MEL 3D Salesforce trading account. While Chan was on holidays, the respondent provided trading instructions to both Cryer and another officer of MEL to place orders for BXP on the 3D Salesforce account.
Charges were issued in relation to the giving of false information in the course of the examinations by ASIC on 25 August 2010 and in relation to the Simix stock transactions on 31 August 2010.
On 8 September 2011, after cross examination of 11 witnesses at a committal hearing in the Magistrates’ Court, the respondent pleaded guilty to the four charges outlined.
Personal circumstances
At the time he was sentenced the respondent was 58 years of age and had no prior convictions. He had worked when young as an accounting cadet at Mercedes Benz Australia for three years whilst attending night school classes at Box Hill Technical School for two years, eventually obtaining a Matriculation pass. At the same time he studied for a Diploma of Business Studies four nights a week at Prahran Technical School, which he obtained after five years. In the following two years he completed a Postgraduate Diploma in Accounting and Finance at Caulfield Technical School, and then obtained a Certificate of Business Studies in Customs from South Melbourne Technical School.
The respondent worked in various accountancy positions, including as an administration and finance manager with various hospitals. He left a position with Active Leisure, Clayton, because he was stressed and overworked. He also worked for some small family businesses.
At the plea hearing the defence counsel described the respondent as a man who had spent his life as an accountant for small family concerns, who eventually found himself in a high powered stressful situation working in a senior capacity for a large, public, hi-tech company with a staff of over 3000.
The respondent had met his first wife when he was 20 and he married in 1975 when he was 22. He and his wife had three children who have never been in trouble with police.
He engaged in a great deal of community service over the years including as treasurer and auditor on a voluntary basis for the Glen Waverley tennis club. He and his wife bought a house in Wantirna in 1975 where he still lives and it was emphasised on the appeal that the respondent had lived a steady and stable life, as evidenced by the fact that he had lived in the same house for over 35 years.
The respondent was involved in his children's kindergarten and primary school committees and in 1980 he joined the Freemasons Lodge and he supported the Freemasons Hospital as treasurer in a voluntary capacity.
In 2003 he and his wife separated. The sentencing judge noted that the respondent’s wife wrote in her reference to the Court that once On Q took over Australian Pure Fruits Limited, the respondent’s workload was immense and he had to work abnormally long hours. This had an adverse impact on their relationship. His wife moved out of the family home and subsequently remarried. He then met his current partner, Christine, through a mutual interest in ballroom dancing and they have been in a stable relationship for over seven years. Neither his former wife nor his current partner has ever been involved in any trouble with the police.
Since mid-2008 until at least the plea, the respondent had been working with the Australian Private Network (‘APN’), an organisation which has about 30,000 customers connected by satellite to a telecommunications network. At the time of sentencing, the directors at APN were aware of the legal position the respondent was in and were supportive of him and wished to continue his employment.
The respondent's father is in his 80s, as is his mother, and they live in a retirement village in Wantirna. They have never been in trouble with the police. They are religious and regularly attend the Church of England. None of the respondent's brothers has ever been in trouble with the police.
At the time of his offending the respondent was under stress in his personal life. In 2007 Christine was diagnosed with the condition Cystomegalovirus, a condition similar in its effect to Chronic Fatigue Syndrome. She gave evidence on the plea that the illness had robbed her of all energy so she had to give up her employment and spend most of her time in bed. She said that the respondent cared for her as best he could while dealing with the demands of his employment. By the time of the plea, her current condition had improved to the point where she had good days and bad days, but she was regularly exhausted and confined to bed for periods of time. She observed that the respondent, when he was working for On Q, was contacted by the directors at all hours of the night, often when he was in bed, and overall his workload was overbearing. She said that during the period of the offending the respondent was particularly distressed over what he perceived to be deliberate exclusion from meetings and a failure to be given full details. He experienced a high-level of concern over McDougall's actions.
The sentencing judge referred to a report by Jeffrey Cummins, psychologist, at which he recorded that the respondent told him:[9]
There was this dispute between Peter McDougall and Howard Christiansen. Mr Ian Christiansen was appointed CEO of BXP in 2005. This all became a nightmare. I was working like a workaholic. I was trying to work out where all the money was going. I was concerned these directors were trying to strip the companies of funds and I felt overwhelmed …
[9]Sentencing remarks, [28].
Mr Cummins expressed the opinion, as a result of the psychological testing he conducted upon the respondent, that the respondent has a passive personality:[10]
[I]n fact he was assessed as being quite interpersonally passive. He was also assessed as having a low-level interpersonal dominance. In my opinion, his interpersonal passivity and low-level interpersonal dominance indicates he is likely to be easily influenced and also indicates he is likely to be relatively easily manipulated.
[10]Sentencing remarks, [29].
It was Mr Cummins’s opinion that the respondent was suffering from depression as a result of these various factors in 2007 and 2008.
Sentencing remarks
The sentencing judge was satisfied that the respondent, a man of mature years, had come from an entirely law-abiding background and had demonstrated a genuine commitment to community welfare as evidenced by his involvement in various organisations on a voluntary basis.
Her Honour received an extensive raft of references from family, friends and former work colleagues, all attesting to the respondent’s otherwise honest character. The view was expressed consistently that the offending behaviour was out of character for the respondent. The opinion was also expressed that the respondent did not have the professional capacity to carry out the duties required of him by On Q, particularly once it fell into financial difficulties.
It was submitted on the plea that the reason for the respondent's offending lay with Hal and Ian Christiansen and that it had taken place for the benefit and survival of the company of which the respondent was a paid employee. It was submitted that the respondent was ill equipped, professionally and emotionally, to work in the high-pressure, sophisticated commercial environment he found himself in when employed by On Q, given his modest background as an accountant, especially for small family companies.
The sentencing judge said that, on balance, she did accept that what the respondent had done must have been done at the behest of the Christiansens’, in particular Ian Christiansen.
Her Honour noted that Chan had also been charged. Chan had pleaded guilty to eight charges of market manipulation contrary to s 1041A of the Corporations Act and one charge of providing false and misleading information in an ASIC examination contrary to s 64 of the ASIC Act.[11] The sentencing judge noted that T Forrest J, in sentencing Chan to 20 months’ imprisonment with a direction that he enter into a recognisance release after four months,[12] had made reference to a meeting attended by Chan, the respondent, Ian Christiansen and Di Donato whereupon all present agreed on the story ‘that would be presented to ASIC as the truth’;[13] that story ‘was designed to protect Christiansen, [Chan], and the other two men’,[14] that is, Di Donato and the respondent. T Forrest J also referred to a meeting on 14 July 2008 whereupon Chan attended Ian Christiansen's house where he was given a computer memory stick with a script for answering questions to be put to him by ASIC investigators. The sentencing judge noted this level of involvement by Ian Christiansen ‘and that logically he was the chief beneficiary of both the respondent’s offending and that of Mr Chan, given the parlous financial state of the On Q Group.’[15]
[11]Chan also consented to four further charges being taken into account (contraventions of s 1101F of the Corporations Act (falsification of records)) pursuant to s 16BA Crimes Act 1914 (Cth): The Queen v Newton Chan (2010) 79 ACSR 189.
[12]See further below.
[13]The Queen v Newton Chan (2010) 79 ACSR 189, 192 [11]; Sentencing remarks, [27].
[14]Sentencing remarks [27].
[15]Sentencing remarks, [36].
The sentencing judge also took account of the fact that the respondent's position as employee with no financial interest in On Q or BXP meant that the only real benefit to him arising from his offending was a continuation of his employment,[16] which was readily replaceable, rather than the direct financial gain experienced by Chan.
[16]Mr Cummins, in his report, noted that respondent had a salary package with On Q worth about $200,000 a year, but apart from that, there was no evidence of enrichment as a result of his offending activity.
Her Honour took into account the invaluable assistance the respondent gave to the liquidators of BXP and the assistance he ultimately gave to ASIC although she noted that the respondent’s value as a witness against Christiansen (who has not yet been charged) has been severely undermined by the respondent’s having admitted lying under oath to ASIC.
The sentencing judge considered that the offences against s 64 of the ASIC Act also demonstrated that the respondent, while otherwise a man of impeccable morals, was capable of extremely serious and dishonest behaviour which represented a betrayal not only of his personal values, but the professional standards designed to protect members of the public who invest in companies such as BXP. Indeed, she considered that the respondent’s standing as a person of honesty and good character also revealed that he must have known that all of the conduct that constituted his offending was entirely wrong.
Ultimately, her Honour determined not to impose a sentence of imprisonment to be immediately served, although she gave that disposition very serious consideration. However, she decided not to incarcerate the respondent in the light of the highly stressful position he found himself in and the following mitigatory factors:
(1)he had received no gain from his offending;
(2)his employment history left him unprepared for the position he found himself in, being part of a sophisticated company set-up which expanded rapidly;
(3)he was a fairly ordinary person suddenly elevated to a position he probably never expected when he began working for McDougall;
(4)he had a passive personality and was a follower;
(5)he had been a hardworking man who had led a fairly exemplary life, involving himself to the benefit of the community;
(6)he had the trust and support of his family and friends and the otherwise honest way he had lived his life was evident from the vast array of references he had been able to summon which were much to his credit;
(7)the prospect of his re-offending was negligible;
(8)he had expressed genuine remorse;
(9)he was willing to give evidence against Di Donato;
(10) there had been some delay in the matter.
Her Honour concluded that a wholly suspended sentence would ultimately serve the purpose of marking the seriousness of the offending.
Appeal by DPP
The DPP has appealed on three grounds, ground 1 of which is that the sentences imposed were manifestly inadequate. This is particularised as a complaint that the sentencing judge failed to give sufficient weight to the nature, circumstances, duration and gravity of the offences, and to considerations of general deterrence and the need to ensure that the respondent was adequately punished for the offences. It is also alleged that the sentencing judge gave undue weight to the personal circumstances of the respondent and to ‘delay’. It was important that the statutory maximum penalty for charge 3 (five years) was significantly greater than the statutory maximum penalty for the other charges (two years), and, it was alleged, the respondent ought not to have been released forthwith, without being required to
serve any portion of any sentence by way of immediate imprisonment.[17]
[17]As a consequence of the statutory abolition of double jeopardy in ss 289 and 290 of the Criminal Procedure Act 2009, in a Crown appeal the Director of Public Prosecutions is not required to satisfy a more demanding test to establish that a sentence is manifestly inadequate in contrast with the test that an offender must meet in order to establish that a sentence is manifestly excessive: DPP v Karazisis (2010) 206 A Crim R 14; DPP v Hardy [2011] VSCA 86, [17]-[18], [32]-[34]. These provisions apply equally to the Director of Public Prosecutions for the Commonwealth as to the Victorian Director: Bui v DPP (Cth) (2012) 244 CLR 638; DPP (Cth) v Bui (2011) 32 VR 149.
Ground 2 is that the sentencing judge erred ‘in pronouncing confused and inconsistent orders relating to the commencement and duration of recognisance periods, sentence cumulation and the “total effective sentence”’.
Ground 3 is that the sentencing judge erred in her belated consideration of s 21E of the Crimes Act 1914 and in the resulting inconsistent pronouncements.
Ground 1 – Manifest Inadequacy
In support of ground 1, the DPP submitted that it was not reasonably open to the sentencing judge to arrive at the sentencing disposition she did, if proper weight had been given to all the relevant circumstances of the offending and the offender.[18]
[18]DPP v Karazisis (2010) 206 A Crim R 14, 44 [127].
The DPP relied particularly on the nature and circumstances of the offending as demonstrating that the respondent’s culpability and degree of responsibility for the offending should be viewed as significant. In particular, the DPP relied on the fact that the offending involved:
(1)a publicly listed company;
(2)significant amounts of money;
(3)a serious breach of trust with respect to the financial responsibility he voluntarily assumed with respect to BXP when he was CFO of On Q;
(4)conduct which occurred over an extended period of time and was not a single aberration as was apparent from the fact that charges 1, 2 and 3 involved a number of false transactions (and the covering up of those transactions) over a six month period while charge 4 was a rolled up charge relating to conduct occurring in June 2008 and March 2009;
(5)instructions given by the respondent to otherwise innocent staff who unwittingly carried out those instructions and thereby placed false entries in the BXP accounting system;
(6)the posting of an additional $3.525 million profit for the financial year ended June 2007 and $3.525 million for the half year ended December 2007, and as such the published accounts for BXP were misleading.
The DPP pointed to the consequences of so-called ‘white collar’ crimes; namely, shareholders, prospective shareholders and the market as a whole is misled. In this context, he argued that general deterrence is especially important because offences of this type are difficult to detect and the investigation and prosecution of it consumes considerable public resources.
The DPP also submitted that, while evidence of good character is important in the sentencing process, it was overvalued in the circumstances of this case and, more generally, it is of lesser significance for ‘white collar’ crimes because it is the very factor which places the offender in a position of responsibility and trust thus enabling him or her to commit offences involving a breach of that trust.
With respect to the delay taken into account by the sentencing judge, the DPP pointed to the fact that the conduct that was the subject of charges 1 to 3 concluded in February 2008 while the ASIC examinations took place in June 2008 and March 2009. Charges were issued in August 2010 following an extensive investigation into the collapse of BXP. A contested committal hearing regarding charges 1 to 3 occurred in August 2011 after which, as mentioned above, the respondent indicated that he was willing to plead guilty to all four charges. The plea hearing took place on 7 and 8 June 2012. In those circumstances, the DPP submitted that the sentencing judge’s conclusion not to impose an immediately custodial sentence gave too much weight to ‘delay’.
To this the respondent emphasised the stringency of the test the DPP had to satisfy to succeed on appeal, namely that the sentence imposed must be, as described in DPP (Vic) v Karazisis,[19] ‘wholly outside the range of sentencing options available’[20] to the sentencing judge, in the sense that ‘it was not reasonably open to the sentencing judge to come to the sentencing conclusion which he/she did if proper weight had been given to all the relevant circumstances of the offending and of the offender’.[21] The DPP accepted the stringency of the test.
[19](2010) 206 A Crim R 14.
[20]Ibid 44 [127].
[21]Ibid 44 [127].
The respondent also submitted that the total effective sentence of 21 months’ imprisonment exceeded the range submitted on the plea by the prosecutor, namely, 11-16 months’ imprisonment. However, the prosecutor had also submitted that some period of time, seven to 11 months, should be immediately served. The prosecutor had also acknowledged that the respondent should receive a lesser total effective sentence than Newton Chan. The respondent argued that the complaint of the DPP must be not the length of the term of imprisonment but the absence of some considerable portion of the sentence being directed to be served by way of immediate imprisonment. The respondent argued that it was thus necessary for the DPP to demonstrate that the sentencing judge was bound to order that he serve some period of time in custody. In support of the submission that such a demonstration is rare, the respondent relied on the statement by Nettle JA in DPP v Oversby,[22] speaking in the context of a case where the offences to which the offender pleaded guilty were aggravated burglary, intentionally causing injury, common assault and damaging property:[23]
[I]t must be rare indeed that where a sentence of imprisonment is of a length that is not manifestly inadequate, but is such that it may be ordered to be suspended, an order that it be suspended operates to render it manifestly inadequate.
[22][2004] VSCA 208.
[23]Ibid [22]. See also Callaway JA to the same effect, [13], Eames JA agreeing with Callaway JA, [15]. See also DPP v Malikovski [2010] VSCA 130, [37] (Nettle JA).
I agree that the complaint of the DPP is in truth the failure of the sentencing judge to order any period of immediate incarceration. However, while it may be rare for the suspension of a sentence to render the sentence manifestly inadequate when the term of imprisonment is of a length that is not manifestly inadequate, I consider that in the circumstances of this case the sentence imposed was manifestly inadequate and that without any period of immediate incarceration the sentence imposed fell wholly outside the sentencing options available to the sentencing judge.
It is tempting to consider ‘financial crimes’[24] as wholly distinct from crimes involving physical violence or destruction of property. But crimes which impair the fair, orderly and transparent conduct of financial markets carry with them a measure of criminal culpability comparable to other more traditional offences. This is particularly so when the financial crime involves deceit and a fraud perpetrated not only on an unidentified class of individuals who purchased and sold BXP shares during the relevant times, but a fraud perpetrated on the general public who are entitled to rely upon the integrity of the market and the appropriate enforceability of the offences which the Commonwealth Parliament has created in relation to it. As T Forrest J said, in the remarks he made in sentencing Chan:[25]
If the markets lack integrity, public confidence in them is necessarily eroded. … [Mr Chan’s] conduct in facilitating the efforts of Hal and Ian Christiansen to artificially inflate the closing price of Bill Express securities … must be viewed seriously. The impact of your conduct is not felt merely by those tempted to purchase Bill Express shares in an artificial market or the banks who would otherwise be entitled to a margin call from exposed shareholders; it is felt by the entire securities market … The aspect of general deterrence must play a significant role in this sentencing exercise.
[24]The Hon Justice Peter McClellan, ‘White Collar Crime: Perpetrators and Penalties’, Keynote Address, Fraud and Corruption in Government Seminar, University of New South Wales (24 November 2011), 18.
[25]The Queen v Newton Chan (2010) 79 ACSR 189, 194-5 [22].
While the Corporations Act offences committed by Chan were contraventions of s 1041A (stock market manipulation), then carrying a maximum penalty of five years’ imprisonment,[26] equivalent only to the maximum applicable with respect to charge 3 in this case, and not to the lesser maximum applicable to charges 1 and 2 (two years), the sentiment expressed by his Honour is equally as applicable to the Corporations Act offences committed by the respondent.
[26]The Queen v Newton Chan (2010) 79 ACSR 189, 190 [1].
As the Honourable Justice McClellan, speaking extra-judicially, said:[27]
When assessing the seriousness of a crime involving violence to an individual, the extent of the harm occasioned to the victim is a significant matter. The sentence may vary depending upon the nature and extent of the injuries inflicted on the victim. White-collar crime also impacts upon victims, sometimes many, but usually lacks any physical violence. Although mostly confined to a loss of money, that loss may have a devastating consequence for the wellbeing of the individual. Identifying and weighing the harm may prove difficult. When a market is manipulated, the loss to a particular individual may be impossible to identify. …
[27]The Hon Justice Peter McClellan, op cit, 6-7 (citation omitted).
While the particular individuals who were harmed in this case from the respondent’s recording of false entries in company journals and the resulting artificial increase in the price of BXP shares may not be identifiable, there is a harm that lies in the erosion of confidence in the market as a whole. The offending had the potential to impair the efficacy and integrity of the market in public securities. Justice McClellan pointed to this when he said:[28]
Both white-collar and financial crime have the capacity to do great harm to many members of the community. Apart from financial loss the psychological harm to an individual in the form of stress and anxiety may be significant. By its nature, white-collar or financial crime may be hard to discover, and the victims’ losses may be difficult to ascertain and quantify. The offender may have a multitude of victims. The crime may affect the Australian economic ‘brand’ and its desirability as a place to invest. This may be contrasted with offences involving property damage, larceny or robbery where the damage is likely to be confined to an individual victim or a small group of victims.
The harm inflicted by insider trading and other market-related offences will be greater both in absolute terms and in respect of the number of victims than many other white-collar crimes and the more common offences. In its ‘rawest form, insider trading dislocates the market. It upsets overseas investors’. Similarly, ‘the vast majority of shareholders suffer. They miss out on value …’ Victims of insider trading include ‘“Mums and Dads”, investors, small traders, and those who do not have the information and trade in that state of ignorance’. Indeed, it is generally the ‘people on the outer ring of the market’, such as retirees and the like, who are particularly disadvantaged.
[28]Ibid 24-5 (citation omitted).
As the New South Wales Court of Criminal Appeal said in R v Rivkin:[29]
The victim of any such offence is the investing community at large, the injury being that related to the loss of confidence in the efficacy and integrity of the market in public securities.
[29](2004) 59 NSWLR 284, [412] (Mason P, Wood CJ and CL Sully J) (‘Rivkin’), referring to R v Hannes [2002] 173 FLR 1.
To my mind, the moral culpability exhibited by the respondent’s offending and the need for general deterrence justify the imposition of an immediate custodial sentence. I base that conclusion, in particular, upon the fact that the respondent’s conduct involved repeated instances of dishonesty over a protracted period of time. It is significant that the respondent had to instruct innocent employees of BXP to record transactions that the respondent knew had not taken place because the transactions related to non-existent stock. Those employees were placed in a position of carrying out what they took to be their responsibilities in good faith and, while believing in the respondent’s honesty, followed his instructions and thereby, indirectly and unintentionally misled the market.
Moreover, even when the chairman of ETT, Larry Shutes and ETT’s CFO, Aliceson Rourke, refused to confirm and make book entries relating to the purchase of the non-existent Simix stock from BXP, the respondent was not diverted from his offending. The criminality of his offending must have been readily apparent to the respondent when the ground of Shutes’ refusal to make the fraudulent book entries was that: ‘I am not fond of porridge.’ Not only did this not divert the respondent, but he rather persisted with his aim by re-presenting the invoice to ETT and was not deterred until Rourke flatly refused to record the $5.9 million sale of Simix stock.
Despite the fact that the respondent cannot but have been aware of the illegal nature of his conduct, he continued in his pursuit by engaging in conduct to assign the sale of the Simix stock to APS with all of the ‘continuing line’[30] of criminal conduct involved in charge 2.
[30]R v Pantano (1990) 49 A Crim R 328, 336 (Smart J).
This was followed by the multiple instances of dishonest conduct comprising charge 3, including numerous misrepresentations to the CFO of BXP, Sean Slattery, in the knowledge that the information would be relied upon as accurate by KPMG.
Furthermore, when the offending was being investigated the respondent chose not to reveal what had happened but engaged in further dishonesty by lying to ASIC and being party to a concocted story to hide the reality of what he and others had done.
While there has been limited case law in relation to the sentencing of offenders for contraventions of s 64 of the ASIC Act, the New South Wales Court of Criminal Appeal has, however, stated general principles in relation to the offence of making a false statement on oath under s 330 of the Crimes Act 1900 (NSW). In R v Bulliman,[31] Abadee J, with whom Gleeson CJ and Hunt J agreed, stated:[32]
False evidence strikes at the whole basis of the administration of justice and indeed, it undermines the whole basis of it. Justice inevitably suffers, whatever be the motive for the making of false statements on oath and whatever be the circumstances in which the offence or offences are committed.
The purpose of an appropriate sentence in this class of case is not only to punish the offender, but to deter others and make plain that the commission of this type of offence will normally be visited with serious punishment. General deterrence is the point of importance to be particularly emphasised in this type of case.
[31](Unreported, New South Wales Court of Criminal Appeal, 25 February 1993).
[32]Ibid 6-7. See also R v Chapman (Unreported, NSWCCA, 21 May 1998), 4.
Moreover, it was not until after the cross-examination of 11 witnesses at the committal hearing that the plea of guilty was forthcoming.
The respondent’s otherwise good character cannot be allowed to displace the need for an appropriate sentence to be imposed, properly reflecting appropriate denunciation of the offence. As the sentencing judge observed, white-collar crimes are different in this respect. This was acknowledged in R v Rivkin:[33]
[T]he relevance of good character is of lesser significance for white-collar crimes, since it is that factor which normally places the offender in a position where he or she is able to commit the offence.
[33]Rivkin, [410], citing R v El Rashid (Unreported, NSWCCA, 7 April 1995), 3 (Gleeson CJ).
It is precisely because of the nature of this form of offending, and the difficulties involved in its detection, that general deterrence must play a particularly important element in sentencing for these type of offences. As Wood J said in R v Pantano:[34]
[T]hose involved in serious white collar crime must expect condign [fitting] sentences. The commercial world expects executives and employees in positions of trust … to conform to exacting standards of honesty. It is impossible to be unmindful of the difficulty in detecting sophisticated crimes of the kind here involved or of the possibility for substantial loss by the public … The element of general deterrence is an important element of sentencing for such offences.
[34](1990) 49 A Crim R 328, 330 (with whom Carruthers J agreed).
The respondent placed considerable emphasis on the appeal on the respondent’s personal and family circumstances and the absence of any personal gain, which he argued set him apart from the circumstances of Newton Chan’s offending[35] and perhaps from most cases of corporate dishonesty. The respondent was not motivated by greed. However, while this factor, along with the stressful environment in which the offending took place, at the behest of the Christiansens, diminishes the respondent’s moral culpability, and while his personal circumstances prompt compassion, it is my opinion that it was not reasonably open to the sentencing judge to impose a wholly suspended sentence of imprisonment. I consider that the sentencing judge could not have arrived at the disposition she did if proper weight had been given to all the relevant circumstances of the offending and the offender.
[35]However, T Forrest J ultimately did not make a finding that Chan’s conduct was motivated by financial gain; in respect of the submission that the receipt of certain shares by Chan provided the financial inducement to offend, his Honour said that: ‘Whilst I regard this explanation for your conduct as more likely than the one you proffer, I am not satisfied beyond reasonable doubt that, in fact, it is the explanation for your conduct – I merely suspect it to be so. Accordingly I am unable to reach any conclusion as to why you sought to manipulate the share price of Bill Express in the way you did’: The Queen v Newton Chan (2010) 79 ACSR 189, 192 [10]. Nevertheless, there are some differences between Chan’s circumstances and those of the respondent, especially in relation to the number and severity of the charges to which he pleaded guilty.
The drawn-out nature of the offending, over a six-month period, involving multiple instances of dishonesty and the deceit of colleagues and others who relied upon the respondent for their instructions, or the accuracy of the information they were given, together with the potential harm to the integrity of the financial market as an institution, lead me to conclude that an appropriate sentence requires a period of immediate incarceration before release to reflect the severity appropriate in all the circumstances of the case[36] and the deterrent and punitive effects which the sentence is designed to reflect.[37] I set out the details of the re-sentencing exercise below. However, in summary I consider that there should be a custodial sentence to be served immediately of 60 days and the length of the term of imprisonment in respect of charge 3 should be extended by three months in recognition of the greater maximum penalty an offence against s 1309(1) of the Corporations Act attracts, together with an additional one month cumulation in respect of that charge which will extend the total effective sentence to one year and 10 months’ imprisonment. I also consider, however, that the period in which the respondent is required to be of good behaviour should be reduced from three years to two years.
[36]Hili v The Queen (2010) 242 CLR 520, 533 [40]-[41]
[37]Ibid 540 [63], citing R v Ruha (2010) 198 A Crim R 430, 443 [45].
Ground 1 should be accepted.
Ground 2 – Separate Commencement Dates for Recognisance Release Orders
The DPP submitted that there is no power to impose multiple recognisance release orders, as the sentencing judge did.
Section 19AC(1) of the Crimes Act 1914 (Cth) relevantly provides:
[W]here:
(a)a person is convicted of a federal offence, or of 2 or more federal offences at the same sitting; and
(b)the court imposes on the person a federal sentence that does not exceed, or federal sentences that, in the aggregate do not exceed, 3 years; and
(c)at the time the sentence or sentences are imposed the person is not already serving or subject to a federal sentence;
the court must make a recognisance release order in respect of that sentence or sentences and must not fix a non parole period.
A recognisance release order is an order that a person be released, upon giving security, after serving a specified period of imprisonment, as provided for in s 20(1) of the Crimes Act. It relevantly provides:
Where a person is convicted of a federal offence or offences the court before which he is convicted may, if it thinks fit:
…
(b)sentence the person to imprisonment in respect of the offence or each offence but direct, by order, that the person be released, upon giving security … either forthwith or after he or she has served a specified period of imprisonment in respect of that offence or those offences … .
It was submitted by the DPP that the sentencing judge erred by staggering the commencement dates of the recognisance release orders. Her Honour did indeed stagger the recognisance release orders when she directed that:[38]
The recognisance in relation to Charge 1 will begin today [29 June 2012]. The recognisance on Charge 2 will begin on 29 September 2012. The recognisance on Charge 3 will be dated to begin from 29 December 2012 and the recognisance in relation to Charge 4 will be dated to begin on 29 March 2013.
[38]Sentencing remarks, [57].
The DPP contended that where an offender is to be released forthwith, there is no power to order multiple recognisance orders in relation to the various sentences imposed. Furthermore, the effect of the staggered recognisance orders was to extend the total recognisance period to three years and nine months (the last recognisance period to be of good behaviour for three years commencing on 29 March 2013) yet the sentencing judge indicated that she intended the recognisance period to last only three years.[39]
[39]Her Honour said: ‘The total effective sentence, therefore, is 21 months and the suspended period or the period for which you are to be of good behaviour will last for three years’. The formal ‘Record of Orders Made’ also referred to a three-year recognisance period, not three years and nine months.
It would appear that the sentencing judge fell into error by utilising the commencement dates of the various recognisance orders as a substitute for the cumulation of periods of imprisonment[40] and/or the total effective sentence.
[40]See Crimes Act 1914, s 19, ‘Cumulative, partly cumulative or concurrent sentences’.
The respondent submitted that if there is no power to impose multiple recognisance release orders, this Court should correct the error by imposing different individual sentences with appropriate cumulation to arrive at the same result but that this error would not in itself warrant a ‘different’ and increased sentence being imposed in accordance with s 289(1) of the Criminal Procedure Act.
I agree with the DPP that the sentencing judge fell into error and that only a single recognisance period should have been ordered. I also agree that this error in itself should not lead to a different or more punitive sentence.
As mentioned above, I consider that the sentence imposed on the respondent was manifestly inadequate and, in the conclusion below, I re-sentence the respondent. However, for the sake of clarity, I accept the submission of the DPP that the proper form of sentence the sentencing judge ought to have made to give effect to her intention was the following:
· On charge 1: convicted and sentenced to 12 months’ imprisonment, commencing on 29 June 2012.
· On charge 2: convicted and sentenced to 12 months’ imprisonment, commencing on 29 September 2012.
· On charge 3: convicted and sentenced to 12 months’ imprisonment, commencing on 29 December 2012.
· On charge 4: convicted and sentenced to 12 months’ imprisonment, commencing on 29 March 2013, and ordered to pay a fine in the sum of $10,000, with a stay granted to 29 September 2012.
· The total effective sentence is one year and nine months’ imprisonment, commencing on 29 June 2012, together with a fine of $10,000.
· The Court orders the release of the respondent under s 20(1)(b) of the Crimes Act 1914 forthwith upon the offender giving security by recognisance of $1,000 to comply with the following condition, namely, that the respondent is to be of good behaviour for a period of three years, commencing on 29 June 2012.
Ground 2 should be accepted.
Ground 3 – Section 21E and s 6AAA Discounts
The DPP submitted that the sentencing judge failed specifically to identify the sentence she would have imposed but for the undertaking given by the respondent to co-operate with law enforcement agencies, pursuant to s 21E of the Crimes Act 1914. The undertaking to co-operate in the future was signed by the respondent and tendered through him in evidence on the plea.
Indeed, the sentencing judge declared the sentence in terms that did not unequivocally indicate the period of time that was discounted by reason of the undertaking to co-operate. Her Honour declared, pursuant to s 6AAA of the Sentencing Act 1991 (Vic), that but for the plea of guilty she would have sentenced the respondent to 21 months’ imprisonment of which 18 months would have been suspended for a period of three years. Her Honour then declared, pursuant to s 21E of the Crimes Act 1914 (Cth) that but for the undertaking to co-operate the total effective sentence would have been 24 months’ imprisonment. The s 21E declaration did not specify what period, if any, of the 24 months imprisonment would have been suspended and for what period, or how this related to the discount given for the guilty plea.
Section 21E(1) of the Crimes Act 1914 relevantly provides:
Where a federal sentence, or a federal non-parole period, is reduced by the court imposing the sentence or fixing the non-parole period because the offender has undertaken to co-operate with law enforcement agencies in proceedings, including confiscation proceedings, relating to any offence, the court must:
(a) if the sentence imposed is reduced – specify that the sentence is being reduced for that reason and state the sentence that would have been imposed but for that reduction.
Section 6AAA(1) of the Sentencing Act relevantly provides:
If -
(a)in sentencing an offender, a court imposes a less severe sentence than it would otherwise have imposed because the offender pleaded guilty to the offence; and
(b) the sentence imposed on the offender is or includes –
(i)an order under Division 2 of Part 3 [custodial orders including suspended sentences]; or
(j) a fine exceeding 10 penalty units; or
(k) an aggregate fine exceeding 20 penalty units –
the court must state the sentence and the non-parole period, if any, that it would have imposed but for the plea of guilty.
(3)If an offender is sentenced for more than one offence in the same proceeding and subsection (1)(a) and (b) apply, the court must state, in respect of any total effective period of imprisonment –
(a) the sentence; and
(b) the non-parole period, if any –
that it would have imposed but for the plea of guilty and need not state those matters in respect of each offence.
It is noteworthy that the statutory provisions give no clear indication of how they interact with each other; that is, they give no clear indication to a sentencing judge as to what he or she is to do if an offender is entitled not only to a reduction in sentence by reason of one of the provisions but also by reason of the other.[41] What is tolerably clear, however, is that, in those circumstances, it is necessary for the actual sentence imposed faithfully to reflect the benefit of both reductions rather than only the larger of the two. To sentence in accordance with the latter approach would be to fail to take account of an offender’s entitlement to a reduction under the other provision. It would fail to recognise that the provisions relate to separate and distinct conduct by an offender that confers largely unconnected benefits upon law enforcement authorities and the community.
[41]There has been some doubt expressed as to whether s 6AAA applies to federal offences as well as to sentences for State offences. In Cooper v The Queen [2012] VSCA 32, the Court (Neave, Mandie and Harper JJA) was prepared to assume that it does, [38], and made a s 6AAA declaration accordingly. In doing so, the Court referred to Scerri v The Queen (2010) 206 A Crim R 1, where counsel for the Commonwealth submitted that s 6AAA should apply to federal offences, by force of s 79 of the Judiciary Act 1901 (Cth), and the Court proceeded on that basis, p 12, [58]. In DPP (Cth) v Johnson [2012] VSCA 38, Hollingworth AJA (with whom Maxwell P and Cavanough AJA agreed) made a s 6AAA declaration in respect of a federal offence, [33]. In this case, the DPP made its submissions on s 6AAA ‘[a]ssuming for present purposes that s 6AAA of the Sentencing Act 1991 (Vic) has application to federal sentences’: Appeal Against Sentence: Supplementary Submissions on behalf of the Appellant (dated 19 November 2012), n 2.
The DPP argued that the sequence adopted by the sentencing judge involved a methodological error in that her Honour should have first addressed the s 21E future co-operation discount, and then addressed the s 6AAA discount for the plea of guilty. The DPP submitted that this is what was done by this Court in DPP v Bui[42] when it upheld the appeal and re-sentenced the offender in accordance with its
residual discretion.[43] As Ross AJA said:[44]
Having regard to all these circumstances, I would resentence the respondent to four years’ imprisonment, commencing from today’s date with a non-parole period of two years. But for the respondent’s s 21E undertaking, I would have imposed a sentence of five years’ imprisonment with a non-parole period of two and a half years. The discount provided in respect of the respondent’s promised future cooperation reflects the fact that the assistance provided, while undoubtedly useful, was not substantial. … Further, but for the respondent’s early plea of guilty (and making no allowance for the undertaking in respect of future cooperation), I would have imposed a sentence of six years’ imprisonment with a non-parole period of three years.
[42](2011) 32 VR 149, 166-7 [97], [99].
[43]In its supplementary written submissions the DPP said, ‘In Director of Public Prosecutions for the Commonwealth of Australia v Bui [2011] VSCA 61, [97]-[100], the Court addressed s 21E of the Crimes Act and then addressed s 6AAA of the Sentencing Act. It is submitted that this is the best approach’: Appeal against Sentence: Supplementary Submissions on behalf of the Appellant (dated 19 November 2012), [2]. In Bui Ross AJA was dealing with an undertaking given pursuant to s 21 E of the Crimes Act 1914 and the utilitarian benefit afforded to the justice system by reason of a plea of guilty. However, the plea of guilty was considered not by reference to s 6AAA of the Sentencing Act but by reference to the factors identified under s 16A(2)(f) and (g) of the Crimes Act 1914. Section 16A sets out factors which a court must take into account, where relevant and known to the court, in sentencing an offender. They include (f): ‘the degree to which the person has shown contrition for the offence: (i) by taking action to make reparation for any injury, loss or damage resulting from the offence; or (ii) in any other manner’, and (g): ’if the person has pleaded guilty to the charge in respect of the offence – that fact’. Under the Crimes Act there is no requirement for a judge to specify the sentence he or she would have given but for the plea of guilty (a requirement which is imposed under the Sentencing Act). Nevertheless, as is apparent from the extract above, Ross AJA did go on to specify what sentence he would have given but for the plea of guilty and it is thus useful to analyse the approach he adopted in considering the two forms of discount.
[44]With whom Nettle and Hansen JJA agreed.
The approach adopted by Ross AJA was to specify the separate reductions he was giving and the sentences he would have imposed as if each factor was the only factor warranting a reduction. This is consistent with the requirements of each of the respective sections because the sections appear to require only that the reduction for each factor be specified as well as the sentence that would have been imposed, absent that particular factor. This approach fails, however, to indicate to an offender the full extent of the reduction given by reason of both factors and can be potentially misleading. This can be illustrated by analysing the methodology employed by Ross AJA.
The actual sentence imposed was a head sentence of four years’ imprisonment with a two year non-parole period. Had the undertaking to co-operate not been made, his Honour would have sentenced the respondent to five years’ imprisonment with a non-parole period of two and a half years. Thus, the reduction in sentence given by reason of the undertaking was one year from the head sentence and six months from the non-parole period. When it came to considering the plea of guilty, Ross AJA put to one side the reduction he would have given by reason of the undertaking, and indicated that but for the plea of guilty he would have sentenced the respondent to six years’ imprisonment with a non-parole period of three years. Thus, the reduction in sentence granted by reason of the plea of guilty was two years from the head sentence and one year from the non-parole period. Had he specified the combined reduction he would have given for both the undertaking to co-operate and the plea of guilty, with respect to the head sentence, he would have needed to have added the discount of one year for the former and two years for the latter, a combined reduction of three years. Had he specified the combined reduction he would have given for both the undertaking to co-operate and the plea of guilty, with respect to the non-parole period, he would have had to have added the discount of six months for the former and one year for the latter, a combined reduction of eighteen months. Thus, the sentence he would have given, absent both factors would have been a head sentence of seven years’ imprisonment (four years plus three years combined reduction) and a non-parole period of three and a half years (two years plus eighteen months combined reduction). However, nowhere in Ross AJA’s sentence is there any indication given to the offender that the sentence he would have faced in the absent of his undertaking and his plea of guilty was a head sentence of seven years’ imprisonment and a non-parole period of three and a half years.
There is a risk of confusion in this context because the actual sentence is invariably specified first before the respective discounts are identified and it might seem that there is an impermissible ‘working backwards’ in this way.
A sentencing judge should not only specify what sentence would have been imposed but for the undertaking to co-operate and the plea of guilty, but also identify what specific reduction has been given with respect to each of those matters (for example, in Bui, the indication would have been, from the head sentence ‘twelve months for the undertaking to co-operate’ and ‘two years for the plea of guilty’). Clearly, what is significant to an offender and provides guidance for future cases is the actual reduction from which the offender has benefited as a result of having given an undertaking to co-operate, and, separately, the actual reduction from which the offender has benefited as a result of having given a plea of guilty. For this purpose, a sentencing judge should identify the number of months (or days, weeks, or years) from which an offender has benefited both by co-operating and by pleading guilty.
This is precisely what was done by T Forrest J in sentencing Newton Chan. In The Queen v Newton Chan,[45] he declared the actual sentence to be imposed and then indicated what the aggregate[46] head sentence would have been but for the undertaking to co-operate and the plea of guilty, and then further indicated the period of reduction given for each of those matters, in the sequence that appeared appropriate to the circumstances of the case. In sentencing Chan on 13 July 2010, T Forrest J said, after indicating the sentence on each charge:[47]
That is a total effective sentence of 20 months imprisonment. I direct that you be released on 13 November 2010 upon you entering into a recognisance release in the sum of $500 to be of good behaviour for a period of 20 months.
I am required to quantify the discounts you have received for your plea of guilty and for your s 21E undertaking. The aggregate head sentence I would have imposed but for those two factors is 3 years imprisonment. I have deducted 8 months from that head sentence for the plea of guilty and a further 8 months for your s 21E undertaking.
[45](2010) 79 ACSR 189.
[46]Crimes Act 1914, s 16 relevantly reads: ‘aggregate, in relation to 2 or more sentences or terms of imprisonment, … means the total effective sentence or term of imprisonment imposed … having regard to whether the sentences or terms are to be served cumulatively, partly cumulatively or concurrently’.
[47](2010) 79 ACSR 189, 196 [24].
What was important about the discounts his Honour ordered in The Queen v Newton Chan was not the sequence in which they were given, but rather that both discounts were taken into account in identifying the aggregate head sentence, providing scope for the specification of each of the two discounts in a simple and clear manner.[48]
[48]See also R v Jones (2010) 76 ATR 249, [19]–[24] where the New South Wales Court of Criminal Appeal dealt with both forms of reduction together, indicating that the principle ought to be that the overall reduction, done on a combined basis, ought not exceed a 40 per cent discount, unless exceptional circumstances applied ([22]). (See also [42]-[43] where an excessively generous overall reduction was not challenged by the Crown).
In my opinion, it would be wrong to consider that there is only one methodology (or one sequence) that is faithful to the requirements of the two sections. In some circumstances, as in Bui, the reduction in the sentence given for the undertaking to co-operate may be specified first before the reduction for the plea of guilty; in other circumstances, as in Chan, it may be more appropriate to indicate the reduction given by reason of the plea of guilty before indicating the reduction to reflect the undertaking to co-operate. Whichever sequence is adopted, it is important that the actual sentence imposed reflects the fact that the offender has had the benefit of both forms of reduction. A way of ensuring this has occurred is to indicate plainly, as T Forrest J has done, what discount is referable to the undertaking to co-operate and what discount is referable to the guilty plea.
However, in addition to specifying the reduction given by reason of each factor, as T Forrest J has done, the respective statutory provisions require that the sentencing judge specify, in respect of each factor, the sentence that would have been imposed but for the reduction. Providing that the combined effect of the two factors leading to a reduction has already been specified, the statutory requirement to specify the sentence that would have been imposed but for one factor, absent the other, should not be misleading.
The DPP submitted, and I accept, that it is important for the administration of justice that there be clarity as to the reduction given for the undertaking to co-operate as there is scope within the Crimes Act, under s 21E(3), for an appeal to be brought by reason of a breach of the undertaking, a failure to co-operate entirely or in part, whereupon the court hearing the appeal is to substitute for the reduced sentence that sentence that would have been imposed on the offender but for the reduction given by reason of the undertaking to co-operate. This necessitates an understanding of precisely what reduction was given for the undertaking to co-operate.
The respondent made no submissions on this ground save to indicate that on the plea, and before her Honour delivered her sentencing remarks, it may not have been apparent that there was a need to descend into detail about the quantum of the respective discounts.
It is apparent that her Honour did not indicate how the discount she proposed to give for the undertaking related to the discount she was prepared to give for the guilty plea. Nor did she specifically identify the sentence she would have imposed but for the undertaking given by the respondent to co-operate with law enforcement agencies, in that the s 21E declaration did not specify what period, if any, of the 24 months’ imprisonment would have been suspended and for what period.
Ground 3 should be upheld.
Conclusion
The sentence imposed on the respondent was manifestly inadequate. Not only was there an error in the sentence first imposed but I also consider that a different sentence should be imposed.[49] The appeal should be allowed.
[49]See Criminal Procedure Act 2009, s 289.
The sentencing discretion is thus re-opened and it is for this Court to re-sentence the respondent.
I am required to specify that the sentence is being reduced by reason of the respondent’s undertaking to co-operate and his plea of guilty. I will specify what the aggregate sentence would have been but for the respondent’s undertaking to co-operate and his plea of guilty. I will then separately indicate what sentence would have been imposed had the respondent not co-operated, and what sentence would have been imposed had he not pleaded guilty.
Re-sentence
Having regard to all relevant mitigating and aggravating factors, I would sentence the respondent as follows:
· On charge 1: convicted and sentenced to 12 months’ imprisonment, commencing on 29 June 2012.
· On charge 2: convicted and sentenced to 12 months’ imprisonment, commencing on 29 September 2012.
· On charge 3: convicted and sentenced to 15 months’ imprisonment, commencing on 1 January 2013.
· On charge 4: convicted and sentenced to 12 months’ imprisonment, commencing on 29 April 2013, and ordered to pay a fine in the sum of $10,000, with a stay granted to 29 September 2012.
· The total effective sentence is one year and 10 months’ imprisonment, commencing on 29 June 2012, together with a fine of $10,000.
· The Court orders the release of the respondent under s 20(1)(b) of the Crimes Act 1914 after the respondent has served 60 days’ imprisonment commencing from today’s date, upon him having given security by recognisance of $1,000 to comply with the following condition, namely, that he be of good behaviour for a period of two (2) years, commencing on 29 June 2012.
Sentence that would have been imposed
· The aggregate head sentence I would have imposed but for the respondent’s undertaking to co-operate and his plea of guilty is two (2) years and six (6) months imprisonment, commencing 29 June 2012, with the respondent to be released under s 20(1)(b) of the Crimes Act 1914 after he had served 90 days’ imprisonment commencing from today’s date, upon him having given security by recognisance of $1,000 to comply with the following condition, namely, that he be of good behaviour for a period of two (2) years, commencing on 29 June 2012, together with a fine of $10,000.
· The combined reduction I have given by reason of the respondent’s undertaking to co-operate and his plea of guilty is eight (8) months’ imprisonment from the total effective sentence and 30 days from the period before he would be released under s 20(1)(b) of the Crimes Act 1914. I set out below the calculations I have made to give effect to these discounts.
Sentence Discounts
Section 21E – Undertaking to co-operate
· But for the respondent’s undertaking to co-operate, pursuant to s 21E of the Crimes Act 1914, I would have added three (3) months to the total effective sentence of one (1) year and ten (10) month’s imprisonment, and 12 days to the period of 60 days before he would be released under s 20(1)(b) of the Crimes Act 1914.
· The sentence I would therefore have imposed but for the reduction given by reason of the respondent’s undertaking to co-operate would have been two (2) years and one (1) month’s imprisonment with the respondent to be released under s 20(1)(b) of the Crimes Act 1914 after he had served
72 days’ imprisonment commencing from today’s date, upon him having given security by recognisance of $1,000 to comply with the following condition, namely, that he be of good behaviour for a period of two (2) years, commencing on 29 June 2012, together with a fine of $10,000.
Section 6AAA – Plea of guilty
· Putting aside the sentence I would have imposed but for the respondent’s undertaking to co-operate, I now turn to the discount I have given for the respondent’s plea of guilty.
· But for the plea of guilty, I would have added to the sentence in fact imposed of one (1) year and ten (10) months’ imprisonment a further five (5) month’s imprisonment with a further 18 days to be served over and above the 60 days actually imposed. This would have resulted in a sentence of two (2) years and three (3) months’ imprisonment with the respondent to be released after he had served 78 days.
The calculations described above may be summarised as follows:
Undiscounted sentence: 2 years and 6 months to be released after 90 days
minus s 21 E discount: 3 months (12 less days in custody)
minus s 6AAA discount: 5 months (18 less days in custody)
Total effective sentence: 1 year and 10 months to be released after 60 days
WILLIAMS AJA:
I agree.
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