DPP v Sands
[2018] VCC 1790
•2 November 2018
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
CRIMINAL DIVISION
Case No. CR-17-02288
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| LYNDEL SANDS |
---
JUDGE: | HER HONOUR JUDGE CANNON | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 24 September and 30 October 2018 | |
DATE OF SENTENCE: | 2 November 2018 | |
CASE MAY BE CITED AS: | DPP v Sands | |
MEDIUM NEUTRAL CITATION: | [2019] VCC 1790 | |
REASONS FOR SENTENCE
Subject: CRIMINAL LAW
Catchwords: Sentence – Pleas of guilty – Theft (two rolled-up charges) – Profound breach of trust – Offending somewhat sophisticated - Offending over period of three and a half years – Catastrophic impact on small family-run business – Business previously financially successful for twenty years – History of alcohol abuse and clinical depression – Good prospects of rehabilitation
Cases Cited:R v Verdins; Buckley; Vo (2007) 16 VR 269); Director of Public Prosecutions v O'Neill [2015] VSCA 325; Boulton (& Ors) v R [2014] VSCA 342
Sentence:Convicted and sentenced to 9 months’ imprisonment in combination with a Community Corrections Order of 2 years’ duration – Ancillary Compensation Order
---
APPEARANCES: | Counsel | Solicitors |
| For the Director | Ms S. Clancy | Solicitor for Public Prosecutions |
| For the Accused | Mr A. Furstenberg | Furstenberg Law |
HER HONOUR:
1 Lyndel Joy Sands, you have pleaded guilty to two rolled- up charges of theft. The offence of theft has a maximum penalty of ten years' imprisonment which reflects the seriousness with which parliament regards the offence and is one of the matters that I must take into account when sentencing you.
2 You provided bookkeeping services to a company Patamak Pty Ltd between November 2008 until May 2015. Patamak Pty Ltd (which I may refer to from time to time as Patamak), is an automotive tyre import distribution and retail business that operates in Australia and New Zealand.
3 At the time of the offending, Patamak was trading in Australia as two entities, namely European Technique and Swan Street Tyre Services. You were responsible for the weekly payroll of employees of these entities and had access to the online banking accounts for each of the businesses. In September 2011, you commenced making unauthorised payments to yourself from the operating banking accounts of European Technique and Swan Street Tyre Services. Between 22 September 2011 and 23 April 2015, you stole a total of $163,615 from Swan Street Tyre Services, which gives rise to Charge 1.
4 Between 8 December 2011 and 15 April 2015, you stole a total of $79,848.70 from European Technique, giving rise to Charge 2. In November 2008, you had met with Mr Trevor Sheumack, Managing Director of Patamak and entered into an oral agreement to provide business accounting and bookkeeping services to the company across all four of its business divisions.
5
You were responsible for a number of areas of work, namely weekly payroll for employees for four business divisions, data entry into the MYOB system, debtor and creditor listings, preparation of business activity statements, bank reconciliations and sales, and accounting reports. It was agreed between
Mr Sheumack and you, that you would be paid $35 per hour plus GST for your services and that you would work between two and three days per week. After 12 months, Mr Sheumack agreed to pay you $40 per hour plus GST for your services.
6 From November 2008 until about March 2014, you performed your bookkeeping duties at the company's Richmond office, which was located in Swan Street. From March 2014, you were allowed to perform some of your duties from home, as you were supporting your father, who was receiving treatment for cancer in Bendigo. Mr Sheumack thought that you were competent and efficient in your bookkeeping role and had placed you in a position of trust in this organisation.
7 I now come to the circumstances of the offending that are the bases for Charges 1 and 2.
8 You transferred funds from the Swan Street Tyre Services Westpac Bank account and from the European Technique Westpac Bank account into two of your own bank accounts, which you operated. Some of those transfers were legitimate as they were payment of your bookkeeping services, however a number of the payments were in excess of your work entitlements. You disguised the illegitimate transfers into your own accounts, by concealing these within grouped payments, which contained legitimate payments to creditors or wages, as well as an illegitimate payment to yourself. The grouped payments would only display the total amount paid unless each individual electronic payment receipt was accessed to observe each individual payment. By way of example, I was told that the records revealed that there was a grouped payment made on 13 June 2014 from the Swan Street Tyre Services bank account for $11,122.70. The reference entered by you was payment to creditors. In a bank statement the payment reference and total amount transfer was the only information that was displayed. However, when the electronic payment receipt for that transaction was accessed by Mr Sheumack, he observed that a payment of $1,100 had been paid to you as well as the balance to two legitimate creditors.
9 From 22 September 2011 to 23 April 2015, you made a total of 160 payments from the Swan Street Tyre Services bank account into your bank accounts, being monies which you were not entitled to. The amounts transferred varied from $102.60 to $1,630. A table detailing each of the 160 transactions- and the table is indeed something that I have had regard to, was annexed to the Crown opening as schedule A. The total amount stolen from Swan Street Tyre Services was $163,615.60 and gives rise to Charge 1, a charge of theft.
10 From 8 September 2011 to 15 April 2015, you made a total of 60 payments from the European Technique bank account into your accounts, being monies to which you were not entitled. The amounts transferred varied from $325 to $1,760. A table detailing each of the 60 transactions was also annexed to the Crown opening as schedule B and I have had regard to that. The total amount stolen from European Technique, as I have said, was $79,848.70 and gives rise to Charge 2, a charge of theft.
11 On 25 April 2015, Mr Sheumack opened a letter from the Australian Taxation Office (ATO), addressed to Patamak, which included a statutory demand on Patamak for $413,826.30 in connection with outstanding payments, fines and interest. Mr Sheumack believed that Patamak was profitable and had been fully complying with its tax obligations and its obligations to all of its creditors.
12 Mr Sheumack spoke with you the following day about the letter he had received. You explained that you had missed some lodgements to the ATO due to your personal circumstances, that you had only missed lodgements in the last three-quarters and that you were in talks with the ATO. Mr Sheumack was not aware that you were in talks with the ATO and did not authorise you to speak on behalf of Patamak. As a result of the ATO's statutory demand, Mr Sheumack undertook a total review of Patamak's bank accounts and discovered a significant number of unauthorised transactions made by you. On 14 May 2015, Mr Sheumack reported the matter to Victoria Police. Victoria Police engaged a forensic accountant, Mr Spence, to review the bank statements and trace reports relating to the two bank accounts associated with Patamak, being those to which I have previously referred, as well as the two bank accounts associated with you.
13 Mr Spence identified 220 unauthorised transactions which are the subject of the two charges to which you have pleaded guilty. You were interviewed by detectives at Richmond Police Station on 20 March 2017 and made full admissions in relation to the offending. You told police the following things:
-That you took the additional money because there were occasions when you were struggling and there was an opportunity.
-That you abused the trust that had been placed in you and that it got out of control.
-That you would transfer the funds directly into your bank account.
- You would try to hide the additional transfers in a one lump transfer.
- You started to take the additional funds because you were struggling and you were trying to support your son.
-Your son was in a bad way and would often steal money out of your purse.
-Sometimes you would transfer the misappropriated funds from your account to your children's accounts to help them.
-You knew you were not entitled to all of the money that you transferred into your accounts and you had made a very big mistake.
-You abused the victim's trust and took advantage of them.
-You had paid back just over $70,000 of the stolen funds.
14 Ms Sands, your offending is serious and deserving of a punishment which is just in all of the circumstances and your conduct must be appropriately denounced. As you are aware, the offending in which you engaged, involved a serious breach of trust which your employer had placed in you. Indeed, it was the trust which was placed in you, that helped you to offend on an ongoing basis.
15 Your offending was somewhat sophisticated as you sought to disguise your thefts in amongst other legitimate transactions and your offending involved numerous transactions, namely 220, with you offending over a period of about three and a half years. On the other hand, as your counsel remarked, your offending was always going to be discovered at some stage, albeit after many thefts and a substantial period of time had elapsed. No doubt, this was because you were so trusted.
16 I take into account the victim impact statement which was tendered at the plea hearing and which was read aloud. Mr Sheumack spoke of the profound ways in which your offending has impacted upon him and his wife and the dreadful struggles that they have had to endure because of your offending. He said that the emotional impact has been significant; that he had always put his trust and faith in his employees, and that your offending had violated his trust which had been very hard to deal with. He said that, as a result, much of the enjoyment of running his business had been stolen from him. He was afraid that the business he had built up over 20 years would be completely destroyed, which has caused him a great deal of stress and anxiety. He has suffered from sleeplessness and feelings of guilt and worry about his family's wellbeing, which has been overwhelming at times. He also suffers from high blood pressure which requires medication. He said that the impact of your offending had taken a great toll on his relationship with his wife, due to the stress placed on finances and her inability to pursue her own ambitions, as she was forced to help his business get back on track.
17 He said that his emotions have ranged from anger to despair, but that he most commonly experiences frustration as he is unable to return things to the way that they were. He described the financial impact to his business as being catastrophic; that he had spent a good deal of his life building up his business but that it would now take about ten years or more to recover. He has also had to expend more than $100,000 in additional accounting charges to rectify damage to his accounting software. He has also incurred penalties and interest charges from the ATO. He spoke of being distracted from running the business for a good deal of time and he devoted a great deal of time looking into the thefts and trying to deal with problems of being able to continue the business- this meant that the business was negatively impacted. He said that the stolen funds and additional outgoings caused by your offending, had resulted in a critical cash flow shortage, with the casualty of this being the liquidation in 2017 of a formerly profitable division of Patamak.
18 He spoke of the ongoing nightmare which has stemmed from your offending, as he has had ongoing fallout with the ATO and has been put to a good deal of time and trouble in order to deal with fines and penalties that the ATO has issued against his company, in respect of employees’ superannuation. His social life has also been negatively impacted by the effects of your offending, as he has had to fight for his business’ survival and has not felt like being too social in any event. He said that he and his wife have had to indefinitely postpone their plans to renovate their house- that he has been focused on survival.
19 In sentencing you, I must take into account the devastating impact of your offending upon the victims in this matter. As you would be aware, Ms Sands, these are the very real and painful effects of your offending.
20 In your favour, you pleaded guilty at the earliest opportunity which entitles you to a significant discount in the sentence you would otherwise receive. In taking this course you have saved the witnesses, especially the victim, the time and trouble of giving evidence and you have saved the community the time and expense of contested proceedings.
21 I was told that at the time of the offending that you were abusing alcohol and that you were clinically depressed. In the course of the plea hearing, your counsel told me that you rationalised your behaviour by reasoning that you had worked a number of hours in overtime without reward. However, you did not approach your employer in respect of this at any stage, which tends to make your rationalisation ring rather hollow, which you now accept. In any event, even if legitimate, it does not excuse your offending.
22 I take into account in a general way the report of Ms Carla Lechner, psychologist, dated 26 August 2018. She saw you on one occasion being 19 July 2018. She is of the view that you currently suffer from symptoms of alcohol use disorder and major depressive disorder. She said that you reported to her a longstanding mood disorder that had been aggravated by your alcohol abuse. She also recorded that you had expressed to her your sense of guilt and shame in respect to the offending.
23 Your counsel did not rely on the case of R v Verdins; Buckley; Vo (2007) 16 VR 269) (hereafter Verdins) to argue that your moral culpability ought be reduced, but referred me to a case of the Director of Public Prosecutions v O'Neill [2015] VSCA 325 which he said entitled me to reduce your moral culpability by reference to your mental health condition in a general way as part of the explanation for your offending. I have considered that decision's applicability to your case- that case largely dealt with personality disorders and the inapplicability of Verdins principles unless impaired mental functioning could be proven. However, the court said, and I quote,
"The determination of an offender's moral culpability does not depend, solely, on an objective assessment of the actions and conduct of the particular offender. Such an assessment necessarily involves a careful consideration of matters personal to the offender which may provide an appropriate explanation as to how, particularly in a case such as this, a hitherto law-abiding person has, committed such a serious crime."[96]
24 In that case, there was evidence that Mr O'Neill had a complex personality disorder which helped explain why he reacted so murderously towards his partner when he was apparently provoked by the deceased. He had then engaged in deceptive and elaborate post-offence conduct which also has some bizarre aspects to it. In your case, you knew very well what you were doing was wrong and you behaved in a calculated, unlawful fashion, time and time again, disguising your conduct in order to avoid detection over a number of years. I accept that you were struggling in a number of ways throughout the time that you were offending, and I factor this in as part of the explanation for it. But I am unable to find that such explanations operate so as to reduce your moral culpability. I was also told that you did not realise the extent of your thefts at the time, such was your state of mind, that you were in a fog which made it difficult to fully appreciate what you were doing. As I say, I take into account, in a general way, the diagnoses found by Ms Lechner, which appear to have been present at the time of your offending, and I factor in your explanations, but I am not persuaded that these are such as to meaningfully impact on your moral culpability which I find is quite high.
25 Having said this, if you were stealing money to fund a lavish lifestyle or to indulge yourself, your moral culpability would have been even higher. However, I accept that you used the money in order to help your children and in a bid to keep the household finances stable, in circumstances where one of your adult children had an entrenched ice addiction which had caused a great deal of financial and emotional havoc in your household.
26 I was told that in answer to civil proceedings brought against you by the victim a number of years ago, you sold your house and gave a sum which was the equity in your home being over $70,000. In the written submissions from defence the sum was nominated as $77,000. The civil proceedings were brought before you were charged, but in circumstances where this was inevitable.
27 While the sale of your house may have been triggered by the civil proceedings and a caveat placed on your home, it is still the case that you chose to give the entire proceeds to the victim. I was told at the further plea hearing that these moneys only served to recompense the victim for the costs he had incurred in civil proceedings. It is unfortunate that so much was spent by him in this respect when criminal proceedings might well have been available for a good deal of what needed to be done and recovered. But having said this, having noted some of the expenses that he incurred in relation to restoring his business, it must also be factored in.
28 In view of your extensive admissions in the record of interview, your attempt to repay the victim by giving him the sale proceeds of your house, your expressions of remorse to your friend, Ms Olga Brown and to Ms Lechner, I accept that you are genuinely remorseful for what you have done and you have appropriate insight into the seriousness of your offending. While you did not properly appreciate the extent of your offending and did nothing to stop it until you were discovered, I accept that this was in the context of ongoing stress, self-delusion, depression and alcohol abuse. However, once you were discovered, you did what you could to address the situation, albeit that you have not made any further repayments since your house was sold. However, you have indicated that you would consent to a restitution order which incorporated an extra $100,000 expended by the victim in respect of this matter, which is a further demonstration of your genuine remorse.
29 I factor in that you have no prior convictions or prior matters which is relevant to your prospects for rehabilitation and the weight that I need to place on specific deterrence and protection of the community.
30 I also factor in delay in this matter, in circumstances where your offending was discovered in 2015. Although a timely report was made to police, it took about two years for you to be interviewed. I was told that the reason for this was the work that had to be done by the forensic accountant. In any event, I take into account that you have had these matters hanging over your head for a significant period of time and that you have used that time in a positive way, in that, you have not reoffended during that period, which is relevant to my assessment of your prospects of rehabilitation.
31 I take into account your background: You are 51 years old. You had a fairly normal upbringing, albeit a strict one, which prompted you to leave home when you were only 16. Subsequently, you reconnected with your parents and had been very close to them. Sadly, your mother passed away in 2002. You have cared for your father for a significant period. He lives in Bendigo and you have regularly travelled to see him. He has cancer and has also been diagnosed with Parkinson's Disease. I was told at the original plea hearing that you had not told him about the proceedings, as you feared that this knowledge would negatively impact on his health. At the further plea hearing I was told by your counsel that your father's health had become even more precarious with two hospital admissions in recent times and that further tests had to be undertaken. He is now being fitted with a catheter due to difficulties he had been experiencing.
32 Further to your background, I was told that when you were 18 years old you became pregnant with your first child and went on to have another two children. You married the father of your children when you were 22. Your marriage was a difficult one as you found your husband to be too controlling. You separated and divorced in 2005. After the divorce, financial pressures began to mount and your oldest son developed an addiction to ice. He battled the addiction for a number of years and stole from you constantly, which was part of the context in which your offending took place. In 2015 your son went into remission; however, he recently relapsed, and on the morning of the original plea hearing you had been advised that he had been taken into custody.
33 Despite the troubles that you have had, you have always stood by your son and are devoted to him and your other children, all of whom are adults. I was told at the further plea hearing that your son remains in custody. Ordinarily, all three of your children live with you at home and you have felt obliged to support them. At the further plea hearing, I was told that you have to relocate to other rental premises, as the house in which you had been residing is to be sold.
34 In terms of your education I was told that you left school halfway through Year 10 and subsequently worked in a supermarket and in hospitality. You also worked as a bank teller for a time. After having children, you were offered a position as a bookkeeper, having taught yourself the necessary skills. You found that you had an aptitude for bookkeeping, and in 2010 you started your own bookkeeping business. I was told that you have continued to work as a bookkeeper which caused me a degree of alarm, especially if your clients are unaware of your offending. I was told that police had made contact with some of your clients so that they were aware. In the interests of being trustworthy and transparent, I would have thought that full disclosure of your offending ought to have been made to people who entrust you with their financial matters nowadays, Ms Sands.
35 I accept that any time in gaol will be harder for you than otherwise because of your state of mental health and your concern for your family, especially for your son and for your father who is seriously ill and may not have long to live. I also accept that your mental health is at risk of deteriorating further if you were to be incarcerated. Further, you have had some problems with your physical health and have experienced abdominal pain as a result of these.
36 I also accept that you are of otherwise good character, as is evident from your lack of criminal history and the glowing character reference which was provided in support of you. You have strong family support- family and friends were at the court hearing in support of you. You also have a strong work ethic which stands you in good stead for the future.
37 In all of these circumstances I find that you have very good prospects of rehabilitation, and I need only place minimal weight on specific deterrence, although factoring into this is the duration of your offending and the deliberative and repetitive nature of it. However, I must place strong weight on general deterrence in a bid to deter others from behaving as you have.
38 At the original hearing, your counsel submitted that a community corrections order was appropriate in your case, while the prosecution submitted that nothing short of a gaol term which involved a non-parole period was appropriate. At the further plea hearing, your counsel submitted that, if I did not accede to his primary submission, that a gaol term in combination with a community corrections order was appropriate.
39 The learned prosecutor provided me with some cases to assist with an assessment of current sentencing practice, which is but one matter that I must take into account, and is not a controlling factor. At the further plea hearing and afterwards, your counsel referred me to some sentences of this court in respect of thefts of similar amounts in support of his submission that a community corrections order, or failing that, a community corrections order in combination with a gaol term was appropriate in your case. I have considered these sentences which also give me some idea as to current sentencing practice, although allowing for the various facts that were not in common with your offending- a principal one of these in a number of those sentences being the size of the victim involved, in terms of their financial capacity.
40 The Court of Appeal has made it very clear in a landmark decision of Boulton & Ors v R [2014] VSCA 342, that community corrections orders had been underutilised in the past and that they had changed the sentencing landscape in such a way that courts ought use them more often than they had been, in order to properly address a variety of crimes, and could appropriately cater for the need to punish an offender and do justice to relevant sentencing factors in a given case. In cases where the offending is too serious to be addressed by a community corrections order alone, the court said that a sentencing judge ought consider whether a gaol term in combination with a community corrections order was appropriate in a given case.
41 Since then, the Parliament has reduced the maximum gaol term from up to two years to 12 months' imprisonment which could be served in combination with a community corrections order if a combination sentence were to be countenanced.
42 Ms Sands, I have given your matter a great deal of anxious consideration, and I have considered, at length, the submissions made on your behalf and on behalf of the prosecution. I have come to the view that I cannot do justice to the weight that I must place on all relevant sentencing principles unless I impose a gaol term in your case, but I do not accept that it must be a gaol term with a non-parole period.
43 I intend to impose a gaol term in combination with a community corrections order. I am afraid that the offending is too serious for anything less than that.
44 Would you please stand up?
45 You are convicted of the offences.
46 I make the compensation order which is consented to by you in respect of the balance outstanding to the victim.
47 I make a forensic sample order by means of the taking of a swab of saliva from the mouth. I make the order because it is not opposed by you, because of the seriousness of the offending and because it is in the public interest to make the order. I must warn you that if you do not cooperate with the authorised officer or officers in the taking of the sample, they may use reasonable force to obtain it.
48 As part of the sentence that I am going to impose, I intend to place you on a community corrections order, but I cannot do that without your consent, so please listen carefully to the order that I propose.
49 The order which would commence upon your release from imprisonment would run for a period of two years and there would be the following terms:
50 First of all, the mandatory terms that apply to all community corrections orders which are: you must not commit another offence for which you could be imprisoned during the time that the order is in force, you must comply with any obligation or requirement prescribed by regulation 17 of the Sentencing Regulations 2011, you must report to and receive visits from the secretary of the Department of Justice or his or her delegate, you must report to the Werribee Community Corrections Centre before 4 pm within two clear working days of your release from gaol, you must let a community corrections officer know within two clear working days of you changing your address or job, you must not leave Victoria without first obtaining permission to do so from the secretary to the Department of Justice or his or her delegate, you must obey all lawful instructions from and directions of the secretary to the Department of Justice or his or her delegate.
51 The conditions that would apply in addition to the mandatory terms are, you must be under the supervision of a community corrections officer for a period of two years from the commencement date of the order. Further, you must undergo assessment and treatment including testing for alcohol abuse or dependency as directed by the regional manager- and I make it clear to you and to Community Corrections that your treatment in relation to alcohol abuse must be of an intensive nature for the duration of the community corrections order. Further, you must undergo mental health assessment and treatment including but not limited to mental health, psychological, neuropsychological and psychiatric treatment and, if necessary, in a hospital or residential facility as directed by the regional manager. Further, you must undergo programs or courses aimed at addressing factors relating to the offending as directed by the regional manager.
52 Do you consent to the terms and conditions of the order?
53 OFFENDER: Yes, Your Honour.
54 HER HONOUR: I should tell you that if you do not comply with all of the requirements of this order then you will face breach proceedings before me, you will be sentenced in relation to the breach, and you will be resentenced in relation to the charges, in which case, you may well be sentenced to a period of imprisonment. I would regard a breach of the community corrections order as a most serious matter, whether it be because of further offending or because of non-compliance with any of the other conditions of the order. Do you understand this?
55 OFFENDER: Yes, Your Honour.
56 HER HONOUR: Do you still consent to the making of the order?
57 OFFENDER: Yes, Your Honour.
58 HER HONOUR: I will now ask your counsel at this stage to assist you with the signing of the community corrections order. You can take a seat for a moment. I have signed the community corrections order, and I note that you signed that too, Ms Sands.
59 In combination with the community corrections order, I sentence you to an aggregate period of nine months' imprisonment.
60 I indicate, if not for your pleas of guilty, I would have sentenced you to a total effective sentence of three years' imprisonment with a non-parole period of 18 months.
61 Therefore, I impose the community corrections order in the terms that I have previously set out in combination with a period of imprisonment of nine months. Could you take a seat for a moment, please.
MR FURSTENBERG: As Your Honour pleases.
MS CLANCY: As the court pleases.
HER HONOUR: Is there anything arising from that?
MR FURSTENBERG: No, Your Honour.
MS CLANCY: No, Your Honour.
HER HONOUR: All right. Yes, thank you, if you could remove Ms Sands. We'll now adjourn.
- - -
3
0