Mao v The King
[2022] VSCA 211
•30 September 2022
| SUPREME COURT OF VICTORIA COURT OF APPEAL |
| S EAPCR 2022 0050 |
| SHANSHAN MAO | Applicant |
| v | |
| THE KING | Respondent |
| S EAPCR 2022 0051 | |
| SHAOJING NIU | Applicant |
| v | |
| THE KING | Respondent |
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| JUDGES: | BEACH and T FORREST JJA |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | 28 September 2022 |
| DATE OF JUDGMENT: | 30 September 2022 |
| MEDIUM NEUTRAL CITATION: | [2022] VSCA 211 |
| JUDGMENT APPEALED FROM: | [2022] VCC 526 (Judge Doyle) |
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CRIMINAL LAW – Sentence – Applications for leave to appeal – Two applicants obtaining financial advantage by deception – Continuing criminal enterprise offenders – Fraudulent loan applications – Amount obtained in excess of $9 million – Aggregate sentences of 3 years with NPP of 18 months, and 2 years and 4 months with NPP of 1 year and 2 months – Whether sentences manifestly excessive – Whether parity principle infringed – Family hardship – Whether judge erred in failing to find exceptional circumstances – Whether insufficient sentencing discount given in respect of co-operation – Whether judge erred in assessing objective seriousness of offending or moral culpability – Proposed grounds of appeal not reasonably arguable – Applications for leave to appeal refused.
Crimes Act 1958, s 82(1); Sentencing Act 1991, ss 5(2AB), 6H, 6I and 9.
Markovic v The Queen (2010) 30 VR 589, Clarkson v The Queen (2011) 32 VR 361 and Collins v The Queen [2015] VSCA 106 applied; Totaan v The Queen [2022] NSWCCA 75 referred to.
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| Counsel | |||
| Applicant, Ms Mao: | Mr R Nathwani | ||
| Applicant, Mr Niu: | Ms L Thies | ||
| Respondent: | Ms DI Piekusis KC | ||
Solicitors | |||
| Applicants: | Papa Hughes Lawyers | ||
| Respondent: | Ms A Hogan, Solicitor for Public Prosecutions | ||
gfv
BEACH JA
T FORREST JA:
On 9 February 2022, Shanshan Mao and Shaojing Niu (collectively, ‘the applicants’) each pleaded guilty in the County Court to eight charges of obtaining a financial advantage by deception.[1] The charges related to fraudulent loan applications made by them to the ANZ, NAB and Westpac Banks. As a result of their fraudulent applications, the applicants obtained eight loans totalling in excess of $9 million.
[1]Contrary to s 82(1) of the Crimes Act 1958.
Having pleaded guilty to three or more continuing criminal enterprise offences,[2] the applicants fell to be sentenced as continuing criminal enterprise offenders within the meaning of s 6H(1) of the Sentencing Act 1991. As a result, the maximum term of imprisonment for each of the offences to which they pleaded guilty was 20 years.[3]
[2]Obtaining a financial advantage by deception where the value of the financial advantage obtained is $50,000 or more is a continuing criminal enterprise offence by the operation of s 6H(1) and Schedule 1A of the Sentencing Act 1991.
[3]See s 6I(1) of the Sentencing Act.
On 4 March 2022, Ms Mao was sentenced to an aggregate term of imprisonment[4] of 3 years, with a non-parole period of 18 months. On the same day, Mr Niu was sentenced to an aggregate term of imprisonment of 2 years and 4 months, with a non-parole period of 1 year and 2 months. In sentencing Mr Niu, the judge declared pursuant to s 5(2AB) of the Sentencing Act 1991, that the Court imposed a less severe sentence on him because of an undertaking he had given to assist law enforcement authorities by giving evidence against a co-accused, DT.
[4]See s 9 of the Sentencing Act.
Ms Mao now seeks leave to appeal against her sentence on the following proposed grounds:
1.The judge fell into error by concluding that there was not exceptional circumstances [sic] to conclude that [Ms Mao’s] children would not suffer sufficient hardship to warrant significant mitigation.
2.The judge erroneously assessed the objective seriousness of the offending in concluding that the criminality and moral culpability of [Ms Mao] was significant where there was no loss to the victims.
3.In all the circumstances, the sentence imposed was manifestly excessive.
Mr Niu also seeks leave to appeal against sentence. His proposed grounds are as follows:
1.In all the circumstances, the sentence imposed on [Mr Niu] when compared to the sentence imposed on his co-offender [Ms Mao] gives rise to a justifiable sense of grievance.
2.The judge failed to give appropriate weight to [Mr Niu’s] assistance to the authorities.
3.In all the circumstances, the sentence imposed was manifestly excessive.
Circumstances of the offending
The eight offences to which the applicants pleaded guilty were committed between August 2015 and February 2018. Each offence consisted of dishonestly obtaining a loan from a bank. The loans varied in amount from a little over $500,000 to a little over $2 million. The circumstances of each offence may be briefly summarised as follows.
Charge 1
Charge 1 related to an application for a home loan from the ANZ in the amount of $1,215,000. On 26 June 2015, the applicants applied as guarantors of their company, Keke Asset Holding Pty Ltd (‘Keke’) for a home loan for the purpose of purchasing a property in South Road, Brighton East. Both of the applicants signed the loan application. As part of the application, Mr Niu provided three payslips from Shenzhen Qianhai NPB Development Company (‘Shenzhen’). The payslips fraudulently represented that Mr Niu was in receipt of a monthly income of $20,162. Mr Niu had no such employment. The ANZ granted the loan application.
Charge 2
Charge 2 related to a loan in the amount of $1,012,500. On 2 September 2015, the applicants applied for a second home loan from the ANZ to purchase a property in Parer Street, Burwood. The application was signed by both of the applicants. Again, the same three fraudulent pay slips were provided as part of the application. The loan was drawn down on 9 October 2015. The essence of the false representations was what was contained in the pay slips provided.
Charge 3
On 7 April 2016, the applicants applied as guarantors of Keke for a $2 million loan from the NAB to refinance their existing home loan and for the construction of an additional unit in South Road, Brighton East. Again, both of the applicants signed the loan application. In the application, Mr Niu declared that he was employed by a company, WB Co, since August 2015, and that he had an annual gross salary of $185,000. Three fraudulent pay slips were provided purporting to cover the period 1 January 2016 to 31 March 2016.
The NAB loan application required the offenders to declare all liabilities including loans and credit cards with other financial liabilities. The applicants declared that they had liabilities totalling $2,071,653. They failed to declare additional liabilities totalling in excess of a further $3 million. The NAB lent the applicants $1.2 million to refinance their ANZ home loan.
Charge 4
On 27 October 2016, the applicants applied for a construction loan to build an additional unit in South Road, Brighton East. They applied again as guarantors of Keke. Again, Mr Niu declared that he had been an employee of WB Co since August 2015 and that he had a gross salary of $185,000. Fraudulent pay slips were again provided, and the offenders again fraudulently failed to declare certain liabilities. The construction loan was approved and drawn down in the name of Keke. The amount of the loan was $532,828.55.
Charge 5
On 15 March 2017, the applicants applied for a home loan from Westpac to purchase a property in Warrigal Road, Cheltenham. The amount of the loan was $900,000. Again, Mr Niu falsely represented that he worked at WB Co as a finance manager, although no income details were disclosed on this occasion.
Additionally, the applicants were required to declare all liabilities. Again, they failed to declare all of their liabilities – understating their liabilities by in excess of $2 million. The home loan was approved and then drawn down on 29 June 2017.
Charge 6
Charge 6 involved a loan for $1,096,000. On 3 July 2017, the applicants applied for another home loan from Westpac for purchasing a property in Faulkner Street, Clayton. In support of the application, Mr Niu provided a pay slip from WB Co indicating that he worked there and that he had earned $15,250 from 1 June to 30 June 2017.
The loan application required the applicants to declare all of their liabilities but again they failed to do so, understating their liabilities by more than $2 million. The application was approved and drawn down on 1 September 2017.
Charge 7
Charge 7 related to a loan of $1,033,000. On 16 October 2017, the applicants applied for a home loan to purchase a property in Mora Avenue, Oakleigh. They both signed the application. Again, pay slips from WB Co were provided, this time from 1 August 2017 to 2 October 2017, with a monthly gross salary of $15,416.67. The declaration as to liabilities failed to include loans with NAB and two loans with Westpac. The application was approved, and the loan was drawn down from 20 October 2017.
Charge 8
Finally, Charge 8 related to a home loan in the amount of $2,038,504.96. On 9 January 2018, the applicants applied for a loan from the NAB for the purpose of refinancing and constructing a property in Draper Street, Ormond. They both signed the application form.
In support of the application, an employment letter written by DT, who was the CEO of WB Co, and who Mr Niu claimed to be employed by, was provided. The letter falsely represented that Mr Niu held a permanent full-time position as a finance and business development manager with the company, and that he had an annual salary of $185,000. On this occasion, the applicants failed to declare liabilities totalling in excess of $4 million that they had with the ANZ and Westpac.
Personal circumstances of Ms Mao and Mr Niu
Ms Mao was born in China in October 1980, and was 41 at the time of sentencing. Mr Niu was born in China in December 1979, and was 42 at the time of sentencing. Ms Mao’s father worked in China as a personal assistant and then in managerial roles. Both of her parents are now retired, and currently living in New Zealand. She has a sister who works as a nurse in New Zealand. In 2000, she commenced studying at the Henan University of Economics and Law in China. She met Mr Niu who was studying at the Henan Industrial University. Mr Niu’s mother was an accountant, and his father worked for the local government for over 30 years. Both are now retired and living in China.
In 2000/2001 the applicants migrated to New Zealand for a better life. Between 2002 and 2004, both of the applicants completed Bachelors of Financial Economics at Massey University. They married in Auckland in 2003. Between approximately 2006 and 2014, Ms Mao worked in banking in New Zealand. During the same period, Mr Niu sent job applications to a large number of companies, but only Chubb Security responded. He commenced employment in 2006 as a mobile locksmith. In early 2010, he started his own locksmith business.
In January 2014, the applicants migrated to Australia. At the time of sentencing, they had four children: a 17 year old, twin 13 year olds and a 9 year old. Between January and September 2014, Ms Mao worked as a home finance manager at Westpac. Between September 2014 and November 2018, she worked as a home loan manager at the ANZ, before being dismissed in 2018. After arriving in Australia, for approximately three months in 2015, Mr Niu worked as a locksmith. He then commenced work as a property developer. During the course of the plea, the judge was told that, during COVID, Mr Niu ‘has had almost no work’. The applicants and their four children are New Zealand citizens, residing in Australia as temporary residents on subclass 444 visas. Neither of the applicants has ever been charged or convicted of a criminal offence.
Sentencing reasons
The judge commenced his reasons by summarising the applicants’ offending.[5] Under the heading ‘Interviews’, the judge summarised the responses of the applicants upon their arrest as follows:
•Mr Niu confirmed that he had submitted all of the loan applications. He admitted that he never worked at Shenzhen or WB Co. He told police that the payslips from Shenzhen were provided by a friend in China, and the payslips from WB Co were provided by DT. Mr Niu provided police with a USB containing emailed correspondence between himself and DT ‘that confirmed the details of the fraudulent documents’.[6]
•Ms Mao told police that she was aware of the loan applications submitted by Mr Niu, but that she did not know any of the details. She said that when ANZ showed her the false payslips she was ‘in shock’. She said she was ‘so busy at work’ that she just let Mr Niu take care of the loan applications. She said that she signed most of the loan applications without reading the details, and that she trusted Mr Niu.[7]
[5]DPP v Mao [2022] VCC 526, [2]–[24] (‘Reasons’).
[6]Ibid [25]–[27].
[7]Ibid [28].
The judge noted that both applicants pleaded guilty at a committal mention on 19 July 2021. He accepted that their pleas were made at the earliest opportunity, and he gave credit for the utilitarian value of the pleas which had saved the Court the time and resources involved in what would have been a complicated trial.[8] The judge also noted that the utilitarian value of each plea was heightened because of the very substantial backlog of trials resulting from the suspension of trials during the pandemic. The judge referred to Worboyes v The Queen,[9] noting that Worboyes was authority for ‘the need for a palpable amelioration of sentence in recognition of the increased utilitarian value of a guilty plea’.[10] The judge also accepted that the applicants’ pleas indicated remorse and a willingness to facilitate the course of justice, saying that each offender must receive a sentencing discount ‘of some significance’ for their guilty plea.[11]
[8]Ibid [29].
[9][2021] VSCA 169 (‘Worboyes’).
[10]Reasons, [29]–[30].
[11]Ibid [31].
After summarising the applicants’ personal circumstances,[12] the judge referred to their four children. The judge described the effect of the discovery of the applicants’ offending on the eldest child, saying that she had become depressed and anxious and that this had caused difficulty with her studies in her final year of secondary schooling. The judge noted a letter from a psychologist, Peter Mangold, which stated that the applicants’ eldest child suffered from ‘acute distress, symptoms of depression and there were occasions of self-harm’.[13]
[12]Ibid [32]–[38].
[13]Ibid [39]–[42].
Under the heading ‘Seriousness of the offending’, the judge said:
I turn to the seriousness of this offending. The offending in this case was protracted, occurring from 7 August 2015 up until the early part of 2018. You used essentially the same successful system on eight occasions, with some variations, including the bank to which you applied for the various loans. This was planned and systematic conduct, involving repeated acts of dishonesty.
At $9,027,833.51, the quantum of the total financial advantage you obtained was very large indeed. Your motive was the accumulation of substantial wealth through property development. The capital you acquired was obtained using outright lies, deliberate omissions and fraudulent documents.
Presumably you knew that without inflating your financial situation and hiding your liabilities the loans would not have been approved. The benefit obtained was substantial and went directly to the two of you. These multiple acts of dishonesty were the building blocks of your attempts to create a very high-value property portfolio for yourselves.
You have four children to look after, but both of you were working and there is no evidence of financial need at that time. Instead, it was emphasised on the plea by both of your counsel that you had substantial financial resources and the banks were never at risk.
In the circumstances, I regard your criminality and moral culpability as significant.[14]
[14]Ibid [43]–[47].
After accepting a prosecution submission that ‘the foundation of the home loan system is the accuracy of … loan applications so [that a ] lender can accurately assess the risk of the loan and make an appropriate decision about whether to lend’,[15] and then saying that home loans are a ‘fundamental feature of the economy and offending like this strikes at the integrity of the system of loan applications’,[16] the judge said that he did not see any meaningful distinction to be made between either of the applicants in their roles in the offending: they were acting together; both signed the loan applications; and the benefits flowed to the two of them as partners.[17]
[15]Ibid [48].
[16]Ibid [49].
[17]Ibid [50].
The judge then referred to this Court’s decision in DPP v Bulfin,[18] describing it as a case ‘which concerned fraud and deceptions involving millions of dollars where there was an early guilty plea, remorse, cooperation with authorities and an undertaking to give evidence against another accused and good character’,[19] before setting out the following passage from the judgment of Charles JA:
Whatever the motivation, offences of the kind here in question almost invariably involve a carefully calculated course of conduct over a long period, repeated deliberate acts of dishonesty, substantial amounts of money and frequently losses (often tragic in their impact) to large numbers of small investors. The offender often holds a position making it possible, or has the ability, to disguise or camouflage the conduct in question. Detection is difficult, the investigation of the crime usually lengthy and very expensive, and the problems of trial and proof will frequently be extreme. … The result of such considerations, in my view, is that the element of general deterrence will usually carry particular significance in sentencing for crimes such as the present, both in relation to the total effective sentence and the non-parole period, together with the requirement for strong denunciation by the sentencing court.[20]
[18][1998] 4 VR 114 (‘Bulfin’).
[19]Reasons [51].
[20]Bulfin [1998] 4 VR 114, 132.
The judge said that the present case shared some of Bulfin’s features, and that some of the statements of principle in Bulfin applied to the sentencing of the applicants.[21]
[21]Reasons [52].
The judge referred to submissions made on behalf of the applicants that the banks were never at risk of losing their money because the applicants had substantial equity (around 20 per cent) in the properties they purchased; and their conduct ‘was not speculative and this was a unique and exceptional aspect of the case that should lead to a substantial reduction in the need for general deterrence and denunciation’.[22] The judge accepted that the loans were serviced and that the banks suffered no loss, but went on to say that general deterrence and denunciation remained sentencing principles of substantial importance. His Honour then said:
It must be that those who participate in offending such as this usually expect the venture to succeed and that their dishonesty will remain undetected. Success of the enterprise and the absence of loss cannot be elevated to become the primary sentencing consideration or be allowed to unduly erode the importance of general deterrence.
For the integrity of the system, it is obvious that those who might be tempted to obtain substantial financial advantages from banks through fraudulent misrepresentations be deterred from doing so. A belief in the ability to service the loan, even if such a belief is proven to be accurate, is somewhat beside the point. The assessment of the borrower's capacity to repay the loan is a matter for the lender, based on honest information.
That said, I accept the absence of loss and the low risk of default is a matter of significance which reduces the objective gravity of the offending.[23]
[22]Ibid [53]–[54].
[23]Reasons [57]–[59].
After referring to the continuing criminal enterprise provisions[24] and character references which were tendered on the plea,[25] the judge turned to the undertaking given by Mr Niu to give evidence in the prosecution of DT.[26] The judge noted that the prosecution’s position was that, without Mr Niu’s cooperation and evidence, there would be no case against DT. The judge said, however, that, on the evidence before him, DT played a lesser role in the offending than the applicants: ‘He participated in the scheme that the two of [them] had already established’.[27] The judge described Mr Niu’s assistance as being of ‘significant importance to the prosecution of the lesser offender in the scheme that was already up and running’, before saying that he would impose a less severe sentence on Mr Niu because of his undertaking.[28]
[24]Ibid [60].
[25]Ibid [61]–[64].
[26]Ibid [65]–[71].
[27]Ibid [66].
[28]Ibid [67].
Importantly for Ms Mao, the judge accepted a submission that some allowance should be made in her sentence because she had encouraged Mr Niu’s cooperation and undertaking. The judge said:
I make some allowance for this. Clearly the two of you have been a unit in this matter. The sentencing discount cannot be comparable to Mr Niu, who has provided the cooperation and the undertaking and who must give the evidence and potentially serve his sentence on protection.[29]
The judge, however, then noted that Ms Mao had initially denied being knowingly involved in the offending, and therefore did not provide the cooperation at the outset that had been provided by Mr Niu.[30]
[29]Ibid [70].
[30]Ibid [71].
The judge observed that there had been delay from when the offending was first detected in October 2018, with the police investigation commencing in February 2019 and charges not being filed until April 2021. He said that the delay was substantial and could not be attributed to the applicants in any way. The judge said that he regarded the delay as a significant mitigating factor. He noted that, during this time, the applicants’ eldest daughter had suffered from mental health issues and that this had been ‘a very difficult situation’ for them, which he took into account.[31]
[31]Ibid [72]–[75].
The judge referred to a submission that hardship to the applicants’ children was a mitigating factor. On the plea, counsel for Ms Mao had submitted that there was hardship linked to the prospect of deportation and reference was again made to the eldest daughter’s mental health issues. Noting that exceptional circumstances are required before a court can mitigate sentence on the basis that it will cause hardship to a third party,[32] the judge said:
In my opinion, the circumstances said to establish exceptional circumstances in this case fall short of meeting the test and there is not the type of cogent evidence required before me that constitutes exceptional hardship in line with the authorities. However, the situation you now face and the position it puts your children in will undoubtedly greatly increase the burden and hardship of the sentences I impose. I have moderated the sentence to reflect this matter.[33]
[32]Markovic v The Queen (2010) 30 VR 589 (‘Markovic’).
[33]Reasons [79].
The judge referred to the risk that the applicants will be deported to New Zealand, saying that deportation from Australia would amount to an additional significant punitive consequence and be enormously disruptive to their children. He said that this factor substantially increased the burden on the applicants of a term of imprisonment.[34]
[34]Ibid [80]–[82].
Under the heading ‘Other mitigating factors’, the judge noted:
•imprisonment would occur during the pandemic which would cause additional hardship;
•a submission that the offenders had lost their life savings and properties, had a tax debt in respect of a capital gain, and had not sought an exclusion from confiscation authorities in respect of the family home;
•Ms Mao had lost her career in banking and Mr Niu had lost his involvement in property development;
•issues such as ‘losing face within your community and with your oldest daughter’ involved extra-curial punishment;
•neither offender had any criminal history, and both had ‘solid employment records’; and
•the applicants had both done their best ‘to assist the asset confiscation authorities to avoid any loss’, and also had ‘very good prospects of rehabilitation’.[35]
[35]Ibid [83]–[86].
After referring to the submissions that had been made on the plea, and sentencing decisions to which the judge had been referred,[36] the judge concluded his reasons by saying:
I have given this matter careful consideration and I have reached the view that a proper application of sentencing principles requires a sentence of imprisonment. Section 9 of the Sentencing Act allows me to impose an aggregate sentence in specified circumstances. An aggregate sentence is one sentence of imprisonment for all eight charges on the indictment, rather than individual sentence for each charge with orders that follow for periods of cumulation between the charges. In a case such as this where the offending covered by each charge on the indictment is essentially the same, the offending is properly described as a series of offences of the same or similar character.
Such a sentence allows me to reflect totality and proportionality. In sentencing in this matter I have taken into account the need for general deterrence and denunciation. I have taken into account your remorse and all of the other matters that I have raised during the course of this sentence as well as the need for you to be rehabilitated and ultimately re-integrated into the community.[37]
[36]Including Tran v The Queen [2014] VSCA 85; R v Huynh [2014] VSC 53; DPP v Vrettakos, Unreported County Court, 24 June 2021; DPP v Akkala [2020] VCC 120.
[37]Reasons [96]–[97].
Ms Mao’s sentence appeal
Ms Mao’s submissions
Ms Mao conceded that, ‘at first blush’ her offending ‘was serious and ordinarily merited a prison sentence’. She contended, however, that the particular circumstances of her case were unusual. She submitted that the judge’s reasoning demonstrated that (a) he had erroneously concluded there was insufficient evidence to find family hardship, (b) he had mischaracterised her criminality and moral culpability as significant, and (c) in all the circumstances of the case, he had imposed a sentence which was manifestly excessive.
In submitting that the judge erred in failing to find there was sufficient evidence to establish family hardship (proposed ground 1), Ms Mao made the following observations and submissions in her written case in this Court:
(1)There was evidence before the court that the applicants had a 17 year old child, 13 year old twins and a nine year old child. All were in Australia on visas, as they are New Zealand nationals. They had been in Australia since 2014. A sentence of over 12 months’ imprisonment would result in automatic deportation pursuant to the Migration Act 1958 (Cth).
(2)The evidence concerning the applicants’ eldest child was that she was suffering from acute distress, depression and anxiety. She was self-harming. Thus the evidence was that the family was already suffering hardship, and a sentence of imprisonment passed on both applicants would ‘inevitably increase that hardship, in particular where both parents were incarcerated for more than 12 months and were primary carers for the children’. The children faced uncertainty and hardship as a result of their parents being incarcerated, the prospect of the family home being confiscated, savings of their parents having been lost and their parents facing deportation upon release from custody — all of this in circumstances where there is no other family within Australia for the children to rely upon.
(3)The exceptional circumstances test referred to in Markovic should no longer apply having regard to the more recent decision of the New South Wales Court of Criminal Appeal in Totaan v The Queen.[38] Thus, even if there was no error in the judge’s conclusion that exceptional circumstances had not been made out, the evidence of family hardship tendered on the plea mitigated the penalty to be imposed on Ms Mao. This submission was, however, withdrawn in oral argument.
[38][2022] NSWCCA 75 (‘Totaan’).
In submitting that the judge erred when he concluded that Ms Mao’s criminality and moral culpability were significant (proposed ground 2), the following submissions were made:
(1)The victims in this case did not suffer any loss. Not one of the loans was ever in default. Moreover, some of the loans were refinancing existing loans.
(2)Not only were the loans serviced, but Ms Mao assisted authorities in realising assets ‘to the extent where the victims in fact profited/benefitted from the criminality’. There is a public benefit in offenders assisting authorities, as Ms Mao did. To that degree, general deterrence should have been moderated — but this does not appear to have occurred.
(3)While Ms Mao’s employment as a housing and investment loan manager gave her some professional expertise in relation to the loans, there is ‘no evidence to suggest she used that specialised knowledge to obtain the loans in a particularly sophisticated way’. There was nothing specialised about the way the loans were obtained that related to her expertise. Additionally, only three of the charges related to offences linked to her employer. Any breach of trust ‘is at the very least limited, if not absent in this matter’.
(4)Ms Mao’s moral culpability was further reduced by her conduct once she became aware of the investigation. She and Mr Niu sought to sell properties to repay the victims; and she encouraged Mr Niu to assist the authorities in prosecuting DT. She also assisted the authorities in realising the remaining assets — ‘making the victims a profit’, and further reducing her moral culpability.
In submitting that the sentence imposed on Ms Mao was manifestly excessive, the submissions made in respect of her first two proposed grounds of appeal were relied upon. In addition to those matters, Ms Mao submitted that there was ‘significant mitigation available to [her] for consideration as part of the instinctive synthesis’, including:
•her good character and lack of prior convictions;
•her early plea of guilty;
•the fact that it was her first time in custody;
•the delay of over four years between the last offence and the date of sentencing;
•her cooperation with authorities;
•hardship linked to concerns about her family;
•hardship caused by her immigration status;
•the ‘discount afforded due to COVID, including relating to the utility of the guilty plea as well as entering custody during the pandemic’;
•genuine contrition;
•extra curial punishment; and
•rehabilitation — ‘as evidenced by the cooperation; the applicant had been deterred and punished prior to her incarceration and as such, there should have been some focus in the sentence upon her rehabilitation’.
In addition, the applicant relied upon the authorities to which the judge was referred on the plea, together with the sentencing principles of totality and parsimony.
The respondent’s submissions
In relation to proposed ground 1, the respondent made the following observations and submissions:
(1)The judge took into account the contents of Mr Mangold’s letter. That said, the letter was tendered by counsel for Mr Niu (not counsel for Ms Mao), who did not explore its contents in any detail.
(2)The submissions made on the plea were that the ages of the children meant that they were dependents; they were vulnerable as they were still in school; and that the eldest child obtained an ATAR of 93, which was regarded as below her capacity — albeit that she had been accepted into a Bachelor of Science at Melbourne University and a Bachelor of Biomedicine at Monash University.
(3)The submission regarding family hardship made on the plea was limited to identifying that there would be children at home while the applicants were imprisoned. The submission was not developed.
(4)On the authority of Markovic, cogent evidence was required to show that imprisonment would expose family members to exceptional hardship, and such cases ‘will be rare’. As the authorities make clear, ‘it would be patently unfair to treat an offender with needy dependents differently to an equally culpable offender who does not have dependents’.
(5)The judge did not err in finding that the evidence fell short of establishing exceptional circumstances.
In relation to proposed ground 2, the respondent submitted that the judge did not err in his assessment of the objective seriousness of Ms Mao’s offending; nor did he err in concluding that her criminality and moral culpability were significant. The respondent submitted that the judge’s findings were open when one had regard to the period over which the offences were committed (August 2015 until early 2018); the fact that in excess of $9 million was obtained from eight separate transactions; the fact that the offending was planned and systemic, involving the use of false documentation; Ms Mao’s completion of relevant tertiary courses in financial economics; Ms Mao’s professional background and knowledge of the home loan system; and her motivation — being to ‘accumulate substantial wealth’.
The sentencing judge accepted that the absence of loss to the banks and the low risk of defalcation reduced the objective gravity of the offending.[39] He was, however, correct to say that success of the venture and the absence of loss could not be elevated to become the primary sentencing consideration, or be allowed to unduly erode the importance of general deterrence.[40]
[39]Reasons [59].
[40]Ibid [57].
In relation to proposed ground 3, the respondent observed that the ground of manifest excess is a stringent ground, difficult to satisfy.[41] The respondent submitted that the sentence imposed was not wholly outside the range of sentencing options available to the judge when regard was had to the following:
[41]Clarkson v The Queen (2011) 32 VR 361, 385 [89].
•the offending was protracted;
•between 7 August 2015 and 2 February 2018, Ms Mao submitted eight loan applications;
•a total of $9,027,833.51 was obtained by way of ‘this scheme’;
•the motivation for the offending was to increase Ms Mao’s wealth ‘by way of property development’;
•the maximum penalty for each offence was 20 years; and
•general deterrence and denunciation were significant sentencing purposes.
The resolution of Ms Mao’s application
Proposed ground 1 is without substance. The question of whether the judge erred in finding that there were no ‘exceptional circumstances’ falls to be determined in exactly the same way as the issue of whether a sentence is manifestly excessive.[42] In the present case, it was well open to the judge to conclude that exceptional circumstances had not been established on the evidence. The following points may be made:
(1)The letter from Mr Mangold was a three paragraph document headed ‘To whom it may concern’ written in support of an application under a Special Entry Access Scheme as part of a VTAC university application. The document was, to say the least, spare in its contents — particularly as to the cause of any of the symptoms referred to in it.
(2)If it was sought to establish exceptional circumstances by reference to a psychological or psychiatric condition suffered by a child of an offender, usually one would expect at least a detailed medical report setting out how any such condition was linked to the offending, and detailing the severity and prognosis of the condition. Ordinarily, one would also expect that such a condition had been the subject of psychological or medical treatment, with reports from relevant treaters being provided to the Court.
(3)The evidence concerning the immigration status of the applicants, and the prospect of their deportation after serving any term of imprisonment, could not on its own (or in combination with the other matters relied upon by Ms Mao) constitute exceptional circumstances. Such matters are relatively commonplace in the sentencing of offenders who are not citizens of this country — something which is also a relatively common occurrence.
(4)The uncertainty and hardship created by the incarceration of the applicants was similarly not an exceptional circumstance. In offending of the present kind, the prospect of confiscation proceedings being taken and assets (including the family home) being lost is all too common. While the lack of other family within Australia is a matter of significance, it is to be observed that, at the time of sentencing, the eldest child was 17 and had completed secondary schooling. This was not a case involving very young children with no-one in the world to look after them.
[42]Markovic (2010) 30 VR 589, 604 [80].
In truth, the matters relied upon by Ms Mao as establishing ‘exceptional circumstances’ (whether considered alone or in combination) did no such thing. All of the matters relied upon by Ms Mao were the very sorts of matters that arise in cases like the present. We see no error in the judge failing to be satisfied that the evidence disclosed exceptional circumstances. If Ms Mao was serious in her endeavour to establish exceptional circumstances, we would have expected considerably more detailed evidence as to the likely consequences of the incarceration of the applicants to have been tendered on the plea.
The withdrawal in oral argument of Ms Mao’s written submission that Markovic should no longer be applied having regard to Totaan relieves us of the obligation to deal with the submission. We would note for completeness, however, that in our view Ms Mao’s counsel was right to withdraw the submission. As Totaan makes plain, Markovic states the position at common law;[43] whereas Totaan was concerned with sentencing for federal offences, in the context of s 16A(2)(p) of the Crimes Act 1914 (Cth) — a provision not relevant to the sentencing of the applicants in the present case.[44]
[43]Totaan [2022] NSWCCA 75, [83].
[44]See also Adams (a pseudonym) v The Queen [2022] SASCA 47, [79]. See further, Mohamed v The Queen [2022] VSCA 136, [82]–[90]; Rodgerson v The Queen[No 2] [2022] VSCA 154, [64]–[74].
Proposed ground 2 is also without substance. There was no error in the judge concluding that Ms Mao’s criminality and moral culpability were significant, notwithstanding that none of the banks suffered any loss and Ms Mao both cooperated and encouraged Mr Niu to assist the authorities following the detection of her offending. As the respondent correctly submitted, Ms Mao’s offending was protracted; a total of in excess of $9 million was obtained by way of the scheme in which she participated; the offending was planned and systemic; and the frauds perpetrated by the applicants were designed to gain them substantial wealth.
To the extent that Ms Mao contended that the banks profited or gained some windfall from her offending because the secured properties were realised for amounts exceeding the amounts borrowed, we reject that submission. There is no basis for any contention that the banks obtained anything other than the repayment of the loans together with interest and fees chargeable pursuant to those loans.
When one looks at the objective circumstances of Ms Mao’s offending and takes into account the relevant matters in mitigation which bear on her criminality and moral culpability, it cannot be concluded otherwise than that her criminality and moral culpability were not insignificant — or, as the judge put it, they were significant. Proposed ground 2 is thus without merit.
Finally, there is nothing in the applicant’s assertion that the sentence imposed on her was manifestly excessive (proposed ground 3). All of the matters relied upon by the applicant in mitigation were considered in appropriate detail by the sentencing judge. The aggregate sentence he imposed was, if anything, lenient having regard to the duration and extent of the offending. As the respondent correctly submitted, and at the risk of repetition, the offending was protracted; a total of in excess of $9 million was obtained; the motivation of the offending was to obtain substantial wealth; the maximum penalty for each offence was 20 years; and general deterrence and denunciation were significant sentencing purposes. Realistically, no lesser sentence could have been imposed on Ms Mao in relation to this offending.
None of Ms Mao’s proposed grounds of appeal being reasonably arguable, her application for leave to appeal against sentence must be refused.
Mr Niu’s sentence appeal
Mr Niu’s submissions
Under proposed ground 1, Mr Niu observed that his head sentence was only eight months lower than Ms Mao’s head sentence; with his non-parole period being only four months lower than Ms Mao’s. In relation to the head sentence, he noted that this equated to a reduction of less than 25 per cent from Ms Mao’s sentence. He submitted that there were three matters of significance which distinguished his case from that of his co-accused, and which should have resulted in a greater disparity between the sentences imposed:
(1)Mr Niu’s offending did not involve a breach of trust, whereas (in relation to three charges) Ms Mao’s ‘knowledge of the home loan system, and use of that knowledge so as to obtain a financial advantage from her employer (and other banks) was a breach of trust’.
(2)Mr Niu made full and frank admissions upon being interviewed by police. A few days later he provided the police with a USB containing email correspondence between himself and DT. On the other hand, upon her arrest, Ms Mao denied knowledge of the details of the home loans submitted; she said she was shocked when the ANZ showed her the false payslips; and she said that she had been busy at work, and had let Mr Niu take care of the loan applications — signing them without reading the details as she trusted him.
(3)Mr Niu provided the USB containing email correspondence with DT; made a detailed statement setting out DT’s involvement; and undertook to give evidence in the prosecution of DT.
Under proposed ground 2, Mr Niu submitted that if a discount for cooperation approaching 50 per cent had been given by the judge, a total effective sentence of four years and eight months would have been the sentence but for the cooperation. Such a sentence would have been manifestly excessive when proper regard was had to all of the matters in mitigation including the absence of any loss suffered by the banks and the low risk of default in any event. Moreover, the sentence of two years and four months, on its face, supported a conclusion that a wholly inadequate discount was given in respect of the assistance given, and undertaking provided, by Mr Niu.
In submitting that the sentence imposed on him was manifestly excessive (proposed ground 3), Mr Niu relied upon the assistance he gave to authorities and the undertaking, as well as the following matters:
•his full and frank admissions and plea of guilty at the earliest opportunity;
•the fact that his plea was entered at a time when the pandemic meant that a trial could not proceed;
•the significant delay and the effect of that delay on him and his family;
•the increased burden of his time in custody as a result of the hardship caused to his family;
•the fact that the risk of deportation would cause significant hardship to him during his sentence, and as referred to in Guden v The Queen;[45]
•the extra curial punishment he suffered, including his loss of involvement in property development and the impact of the offending on his eldest daughter’s mental health; and
•his very good prospects of rehabilitation.
The respondent’s submissions
[45](2010) 28 VR 288 (‘Guden’).
In relation to proposed ground 1, the respondent submitted that it was reasonably open to the judge to differentiate between Mr Niu and Ms Mao as he did, and arrive at the sentence imposed on Mr Niu. The respondent noted that the judge found that the role of each applicant was indistinguishable;[46] both applicants were cooperative with confiscation authorities;[47] and both applicants pleaded guilty at the earliest opportunity, indicating remorse and a willingness to facilitate the course of justice.[48] Moreover, because Ms Mao did not have any contact with DT, she was unable to provide assistance — but she had encouraged Mr Niu to assist authorities in relation to that matter. Accordingly, the judge had made some allowance for her encouraging Mr Niu — even though Mr Niu’s sentencing discount was to be greater than Ms Mao’s.[49]
[46]Reasons [50].
[47]Ibid [55].
[48]Ibid [29]–[31].
[49]Ibid [65]–[70].
In relation to proposed ground 2, the respondent contended that the judge gave appropriate weight to Mr Niu’s assistance and undertaking. The respondent also referred to the judge’s observations that DT played a lesser role in the scheme than each of the applicants; and the fact that Mr Niu was not an informer of the kind who had given assistance that might place his family at risk.
In relation to proposed ground 3, the respondent essentially made the same submissions as had been made in Ms Mao’s case.
The resolution of Mr Niu’s application
Proposed grounds 1 and 2 are interrelated. Properly analysed there is no substance in them.
First, Mr Nui’s attempt to categorise Ms Mao’s offending as involving a relevant breach of trust is misconceived. While Ms Mao was employed by the ANZ Bank as a Home Loan Manager, it was not suggested that she used this position in any directly relevant way in order to obtain the loans from the ANZ which were the subject of charges 1, 2 and 7. In any event, it is of some significance that the judge did not sentence Ms Mao on the basis that her offending involved any breach of trust.
Secondly, While Mr Niu made full and frank admissions upon being interviewed by police and Ms Mao initially sought to deny any criminal involvement on her part, Ms Mao’s position quickly reverted to one of significant cooperation such that each applicant could ultimately be described as cooperative, remorseful and having facilitated the course of justice.
Thirdly, While Mr Niu provided the USB containing email correspondence with DT, and made a detailed statement setting out DT’s involvement, Ms Mao, not having had any contact with DT, was not in a position to provide similar cooperation. That said, the judge found that she had encouraged Mr Niu to assist the authorities in relation to DT, and accepted that she should get some sentencing discount (albeit smaller than the one to be provided to Mr Niu) for her encouragement of Mr Niu’s cooperation.[50]
[50]Ibid [70].
When an appellate court considers whether it is open to a sentencing judge to differentiate, or not differentiate, in the way he or she did when sentencing co-offenders, the approach is relevantly analogous to that which arises when it is said that a sentence is manifestly excessive.[51]
[51]Collins v The Queen [2015] VSCA 106, [23].
In the present case, the only difference of any real significance between Ms Mao and Mr Niu was Mr Niu’s provision of evidence against DT and his undertaking to give evidence at DT’s trial. Even on that issue, however, the judge accepted that Ms Mao was entitled to some benefit from her encouraging Mr Niu in his cooperation and undertaking. In the circumstances, we are unable to see any error in the judge’s analysis or in his treatment of this issue as evidenced by the different sentences he imposed upon the applicants. Mr Niu’s sentence did not fall to be compared with a co-offender who did not also receive a sentencing discount for relevant cooperation and assistance. Ultimately, we are not persuaded that there is any substance in Mr Niu’s complaints about parity and the lack of an appropriate ‘discount’ in respect of his cooperation and assistance.
Finally, we turn to Mr Niu’s complaint about manifest excess (proposed ground 3). For essentially the same reasons that Ms Mao’s complaint of manifest excess must be rejected, Mr Niu’s complaint of manifest excess must be rejected. When one has regard to Mr Niu’s circumstances and the circumstances of his offending, he (like Ms Mao) received a sentence that was, if anything, lenient. Again, at the risk of repetition, the offending was protracted; a total of in excess of $9 million was obtained; the motivation for the offending was to obtain substantial wealth; the maximum penalty for each offence was 20 years; and general deterrence and denunciation were significant sentencing purposes. As in the case of Ms Mao, realistically, no lesser sentence could have been imposed on Mr Niu in relation to his offending.
Conclusion
Notwithstanding the very able way in which counsel for each applicant presented their respective cases, each application for leave to appeal against sentence must be refused.
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