R v Egar

[2019] NSWDC 445

District Court

New South Wales

• Amendment notes

Medium Neutral Citation:	R v Egar [2019] NSWDC 445
Hearing dates:	22 August 2019
Decision date:	29 August 2019
Jurisdiction:	Criminal
Before:	Mahony SC DCJ
Decision:	Full-time custodial sentence. For orders see [102]
Catchwords:	Two offences of dishonestly obtain property by deception; numerous fraudulent transactions as financial controller for two employers; aggregate sentence
Legislation Cited:	Crimes Act 1900 Crimes (Sentencing Procedure) Act 1999
Cases Cited:	CDPP v Poniatowska [2011] HCA 43 CDPP v De La Rosa [2010] NSWCCA 194 Cayahdi v R [2007] NSWCCA 1; 168 A Crim R 41 R v Fangaloka [2019] NSWCCA 173 R v Pullen [2018] NSWCCA 264 R v Todd (1982) NSWLR 517
Category:	Sentence
Parties:	Director of Public Prosecutions (Crown) Allison Egar (Offender)
Representation:	Counsel: D McMahon (Offender)   Solicitors: L Wiggins (Crown)
File Number(s):	18/15980018/159889
Publication restriction:	Nil

REMARKS ON SENTENCE

1. The offender is to be sentenced in respect of two offences pursuant to s 192E(1)(a) of the Crimes Act 1900. The maximum penalty in respect of each offence is 10 years imprisonment and there is no Standard Non-Parole Period proscribed.

2. The offences constitute dishonestly obtain property by deception, and relate to two periods of employment of the offender by two different employers. The first employer was a Dr Govan and the offending took place between 1 October 2013 and 20 October 2015. The second employer was Affirmation Publishing House (“Affirmations”) and the offending in that case took place between 16 December 2016 and 22 September 2017.

3. The offender, who was born in May 1974, was arrested on 22 May 2018 and was committed for sentence on 26 March 2019.

The sentence hearing

4. The sentence hearing took place at Coffs Harbour District Court on 22 August 2019. The Crown Sentence Summary became Ex A and included two sets of Agreed Facts relating to the two offences. They may be summarised as follows.

Facts concerning offence against Dr Murray Govan

5. In 2010, the offender was employed in a medical practice known as Coffs Coast Skin Cancer and Wound Clinic as a practice manager. Her duties included planning, co-ordinating, directing and supervising elements of the medical facility, including billing and collection, patient services and general day-to-day running of the business, and payment of wages.

6. From mid 2012, Dr Govan and the offender commenced an intimate relationship which ended in November 2014.

7. In 2013, Dr Govan’s medical partnership dissolved and the offender chose to remain as practice manager for Dr Govan’s medical practice. Accounting at that practice used MYOB accounting software which recorded all accounting transactions for the business. The MYOB system contained files relating to two bank accounts being used by the business with the National Australia Bank (“NAB”). Payments to account holders were made via what were known as Multiple Funds Transfers (“MFT”) through the NAB. This allowed numerous accounts to be paid at one time, however, the bank statements would only show the total amount of the MFT made. These records were retained for 90 days after creation, during which time, the records could be viewed by the creator of the transaction. After 90 days, the breakdown of MFT’s could only be obtained by making a request to the NAB.

8. The account payment process for the medical practice involved each invoice being given to the offender and then entered onto the MYOB system, by reference to the supplier’s invoice number and a brief description of the purchase and the amount involved. The invoice was then stamped “entered” and placed in a folder labelled “supplier invoices to be paid”.

9. When a number of invoices were due to be paid around the same time, the MYOB system allowed electronic payment by way of the MFT. All invoices included in the MFT were displayed showing each supplier’s name, bank account details and the total amount of the entire payment.

10. Dr Govan became concerned with the financial viability of the medical practice and requested the offender provide him with the bank records, which were provided, together with log-in details for the MYOB system. The offender blamed the practice’s financial position on business decisions involving other staff.

11. The offender took leave in October 2015, following which, the practice manager and other staff became suspicious that she may have been defrauding the practice. That concern was brought to Dr Govan’s attention on 19 October 2015, and a search of the MYOB system revealed a number of unauthorised purchases by the offender. Payments had been entered onto the MYOB system as payments to a supplier, SSS Australia, between 28 August 2013 and 23 June 2015. The medical practice had been billed by that business $160,317.71. In fact, for the 2013/2014 and 2014/2015 financial records, MYOB records revealed that a total of $305,715.28 had been paid to that supplier, representing a difference of $145,397.57. Further investigations revealed a number of false invoice numbers recorded on MYOB. These were created by the offender by altering the invoice numbers or duplicating invoice numbers, and including her bank account details. A forensic accountant was engaged to conduct an analysis of the records, together with the personal accounts and credit cards of the offender. A total of 71 falsified invoices were identified, representing a total of $146,261.16. Police were contacted and the offender, who was residing in Brisbane, attended Tweed Heads Police Station on 22 May 2018, when she was charged.

12. Compensation was sought by Dr Govan in a sum of $146,261.16.

Facts concerning offence against Affirmations

13. The offender was employed by Affirmations from 18 February 2016 as an office manager. She was responsible for bank reconciliations, invoicing, accounts and orders. In respect of all financial transactions, the offender was responsible to the manager and financial controller.

14. In September 2016, the financial controller left her employment and the offender was moved into that position. Around February 2017, the manager and directors of the corporation began to notice that expenditure had increased substantially, causing a cash flow problem. An investigation was initiated by the accountants for the company.

15. The offender then tendered her resignation, but it was agreed that she would continue her role working remotely from an address in Brisbane, Queensland.

16. In mid 2017, the offender was requested to provide information as to why the cost of freight and other business expenses were increasing. The offender provided some information, but not all. This led the manager to seek information from the corporation’s bank as to how payments were being authorised as a dual signature was required. This enquiry revealed that the only signatory on payment authorities was that of the offender, and the bank had not been diligent in enforcing the requirement for two signatories for some time. An audit of the company’s accounts revealed that the offender had committed a number of fraudulent transactions. The manager was notified of those fraudulent transactions by email on 28 September 2017. On the same day, some 20 minutes later, the offender sent an email stating that she was unwell and was resigning from her employment.

17. The fraudulent transactions benefitted the offender to a total of $124,871.80. They were made to five separate accounts, including the private school where her son attended, a veterinary service, BMW Financial Services and bank accounts in the offender’s name, including a credit card account.

18. In October 2017, the offender returned a number of items to Affirmations, including her work laptop computer. It was observed that it was possible to access the manager’s email account due to the laptop configuration, the inference arising that the offender was aware at the time she resigned on 28 September 2017, of the email by which the manager was notified of her fraudulent actions.

19. In November 2017, the manager and the offender had a telephone conversation in which she was told that the corporation was aware that she had been defrauding the business. She admitted her offending and made a claim that she was mentally unwell. She was asked to put what she had told the manager into an email, however, she said she did not want to as it could be used as evidence against her. Notwithstanding that, the offender sent an email on 7 November 2017 expressing guilt and remorse for her actions. When requested to do so, the offender provided details of one of the accounts used to commit the offences, but did not mention others.

20. On Thursday 17 May 2018, police contacted the offender and requested her to attend Tweed Heads Police Station to be charged. She attended on 22 May 2018 and was arrested.

21. Affirmations seeks compensation to the value of $124,871.80.

Other Crown Evidence

22. Exhibit A contained the criminal history of the offender which showed that in 2006 she had been convicted of an offence of obtaining financial advantage and was sentenced pursuant to s 20AB of the Crimes Act 1914 (Cth) to a Community Service Order of 200 hours. She was also ordered to pay reparation to the Commonwealth in the sum of $16,003.84, which represented social security benefits she had received when she failed to report income that she had earnt. On 3 August 2015 she was convicted of a middle range PCA offence, for which she was sentenced by way of a S 10 Bond to be of good behaviour for 18 months. Thus, she was on conditional liberty for a period that straddled both offences.

The offender’s evidence

23. The offender tendered a report from Ms Kay North, forensic psychologist, dated 11 August 2019 (Ex 1). The author recorded that the offender had reported that she was ashamed of her offending behaviour, had expressed remorse for it, and reported feeling relief over being charged, and was willing to accept responsibility for her actions. In respect of the offences concerning Dr Govan, she reported being in a dysfunctional relationship with Dr Goven, during which her mental health had deteriorated, leaving her emotionally labile, socially withdrawn and drinking alcohol on a daily basis. She had commenced to spend above her means whilst in that relationship. She believed that they had a future together and therefore felt that it was acceptable for him to contribute towards her expenses. She commenced taking money “here and there” and would “drink to forget”.

24. In respect of the offending against Affirmations, the offender reported that she continued to suffer from mental health issues relating to her anxiety after leaving her former employment and was experiencing significant financial difficulties. She identified the trigger for the resumption of her offending behaviour has been related to being sexually harassed in her new workplace. She reported that this made her feel vulnerable and she felt a need to escape, and planned to relocate to Brisbane to be closer to her son, who was in boarding school there. Her initial intention was to take money from this company once only, however, “one thing after another” led to her experiencing continued financial difficulties.

25. Under the heading “Family History”, the offender reported being close to her mother who had died in 2016. She had raised her son as a single mother. He was now 20 years of age and was her primary source of support.

26. The offender had left home at the age of 16 years, but completed her schooling when she was 18. She worked in an administrative position from age 19 to 25, when she gave birth to her son, thereafter relocating to Coffs Harbour. She obtained a diploma in small business management through TAFE in 2007.

27. The offender disclosed during her assessment that she had been sexually assaulted at the age of 12 years, but had never told anyone about the assault. She experienced further trauma at the age of 16 years when she was a passenger in a car accident. The vehicle had hit a telegraph pole and she was thrown through the windscreen, suffering facial injuries that resulted in permanent scarring.

28. The offender reported further trauma through being involved in an abusive relationship between the ages of 17 and 18 years. She also described her relationship with Dr Govan as dysfunctional, as there was a power imbalance due to him being her employer. This led to her emotional lability and abuse of alcohol.

29. Under the heading “Mental Health History”, the offender described experiencing difficulties regulating her emotions in the past which had resulted in reckless and self-destructive behaviours. She had a history of self-harm following the motor vehicle accident at age 16. She had resumed that behaviour whilst working for Dr Govan and identified an increase in suicidal ideation since the offences. She had been prescribed an anti-depressant and had commenced psychotherapy and was currently focussing on anxiety management.

30. The offender described her previous offence of fraud against the Commonwealth as receiving overpayments in her benefits due to unintentional errors in her reporting her income over a five year period. She completed 300 hours of Community Service and repaid the debt. She also had a conviction for drive with middle range PCA in 2015, for which she had received a s 10 bond.

31. Upon assessment, the offender was found to have a moderate range for depressive symptoms and to be experiencing mild anxiety symptoms. She was assessed as being a low risk for reoffending, indicating it would be suitable for her to engage in community based treatment. Her history of emotional and behavioural instability, impulsive behaviour, suicidal ideation and engaging in self-harming behaviours, were all characteristic of a borderline personality disorder.

32. The author noted that she had expressed remorse for her offences, and had expressed disbelief as to what she had done. The author was of the opinion that her depressive and anxiety symptoms would be exacerbated should she be in a custodial setting, and her risk of self-harm would be likely to escalate.

33. Finally, the author recommended a treatment plan which involved continuing supervision by her GP, referral to a psychologist for further assessment, and treatment in respect of her risk of harm, alcohol abuse and the risk of relapse.

34. Exhibit 2 contained two testimonials as to the offender’s character, which are referred to below.

35. Exhibit 3 was a letter from the offender dated 21 August 2019 expressing her remorse for her criminal behaviour. It is also referred to below.

36. The Crown further tendered a resume provided by the offender, that she had provided to Affirmations when seeking employment there. Under the heading, “Profiles and Experience”, she had described herself as “a trusted leader and manager”.

The offender’s submissions

37. Counsel for the offender relied on a detailed and thorough written outline of submissions. It noted that the two offences contrary to s 192E of the Crimes Act were rolled up counts encompassing monies obtained by fraud from two employers.

38. The offender accepted that the offending was serious. Factors relevant to the assessment of objective seriousness included;

“a. The offending is comprised of a number of acts and occurred over a period of time in respect of both employers – Count 1 spanned a period of approximately two years, and Count 2 some nine months;

b. Both offences involved the issuing of false or duplicated invoices with the funds in question in many cases being transferred directly into the offender’s bank account;

c. It involved a breach of trust;

d. With respect to Count 1, the total defrauded was $146,261.16;

e. With respect to Count 2, the total defrauded was $124,871.80.”

39. The offender conceded a financial motivation. It was suggested that Count 2 was less serious than Count 1 due to the shorter time period and somewhat smaller sum of money involved.

40. The reporting to the forensic psychologist that the offender had become a victim of workplace sexual harassment, was not advanced as an excuse for the offending. It was, however, submitted that, as an explanation, it found support in the absence of offending between February 2016, when her employment commenced, and December 2016, when the offending in Count 2 commenced. It merely explained the delay in her resuming offending and did not amount to victim blaming.

41. It was submitted that whether or not the offender had read the email notifying the manager at Affirmations of her offending did not matter greatly. What was significant was that when she was confronted by the manager with the allegations she admitted her guilt. Similarly, she provided a written confession by email upon request, notwithstanding that her belief that it could be used against her as evidence.

42. The offender relied on the following subjective features. She was a 45 year old woman with very limited criminal history. The Commonwealth fraud offence, whilst dealt with in 2006, in fact dated back to 2001, and arose from the failure by the offender, who was then roughly 27 years of age and a single mother, to properly inform Centrelink as to her income, resulting from a limited amount of overpayment over a lengthy period of time. Counsel referred to the High Court’s decision in CDPP v Poniatowska [2011] ACA 43, which found that a large number of Centrelink prosecutions arising from omissions to report during that era were without foundation. It was submitted that the offence should not operate to disentitle the offender to some leniency, whilst accepting that good character is typically afforded less weight in cases of fraud.

43. Both the Sentencing Assessment Report and Ex 1, suggested a positive prognosis moving forward. A portion of the offending comprised of Count 2 apparently related to payment of her son’s school fees. Her mother had died of breast cancer in 2016 and she had battled with self esteem issues after she was sexually assaulted at the age of 12 years.

44. It was submitted that there could be no doubt that her relationship with Dr Govan was a highly dysfunctional one and “an obviously inappropriate one given her status as his employee”. The fact of that relationship gave some support to what she described to the psychologist as the:

“Difficulties in regulation of her emotions during this period, leading to her being emotionally labile at work, experiencing insecurity, and drinking alcohol to manage her feelings.”

45. The offender relied on the opinion of the psychologist to suggest a degree of connection between her mental condition of Borderline Personality Disorder and the offending conduct. On each occasion the offending commenced with the intention of a one-off transaction, but thereafter escalated. It was explained by the offender as “living beyond her means”.

46. The offender relied on the principles in CDPP v De La Rosa [2010] NSWCCA 194, in that her mental health condition had the following application:

“a. Where the mental illness bears some causal connection with the offending, it may reduce the offender’s moral culpability;

b. It may, to some extent, reduce the emphasis on specific and general deterrence; and

c. It may mean that any custodial sentence will weigh more heavily.”

47. It was submitted that the last matter was addressed by the psychologist, namely, a custodial sentence would lead to a likely escalation of her mental illness and an increased risk of self-harm.

48. Counsel submitted that the offender had been assessed by both Community Corrections and the psychologist as being a low risk of reoffending. She was entitled to a 25% utilitarian discount on sentence and she had expressed remorse. Further, she had confessed to the manager at Affirmations.

49. It was submitted that she was subject to a non-conviction bond for a PCA offence during the periods encompassed by the offending, however, this was at the lowest end of conditional liberty and ought not operate as a matter of substantial aggravation.

47. It was submitted that there could be no general principle that a sentence of full time imprisonment was required in a case of “white-collar crimes”. Further, the offending was now somewhat stale, dating back to 2013 through to 2015, relying on R v Todd (1982) NSWLR 517.

48. Counsel accepted that the s 5 threshold had been crossed, with particular reference to the breach of trust involved and the period over which the offending occurred. However, it was noted that there was the availability of an Intensive Correction Order if the aggregate sentence of the two offences did not exceed three years. Referring to recent authorities, Counsel submitted that consideration of community protection is an important prerequisite, but not necessarily determinative of whether an Intensive Correction Order should be ordered rather than a full time custodial sentence.

49. Counsel referred to a number of recent sentences, however, each case has to be determined on its own facts and relevant circumstances. Finally, a finding of special circumstances was sought on the basis that it would be the offender’s first custodial sentence, her time in custody would be harder on account of her mental illness, and she had a need for ongoing mental health treatment and rehabilitation.

50. In his oral submissions, learned Counsel for the offender rehearsed the following matters in the written outline. First, the offending was objectively serious and was aggravated by the breach of trust as an employee with responsibility for financial dealings of both employers. It was acknowledged that the benefit of her good character was of diminished weight in sentence.

51. It was submitted that the 2006 conviction for Commonwealth fraud should not mean that some leniency could not be provided in the sentencing process here.

52. Counsel rehearsed the impact of her mental health issues and diagnosis of Borderline Personality Disorder, as found by Ms North. Relying on [3] of Ex 1, it was submitted that there was some causal connection to the offending here. Counsel also highlighted her vulnerability in a custodial sentence, given her history of self-harm and hardship she would face in custody.

53. Counsel rehearsed the subjective factors set out above. It was submitted that, on the balance of probabilities, the court would find that the offender was genuinely remorseful. There had been no repayment of the monies by the offender because of her financially stressed state. Having regard to all of the subjective matters here, it was acknowledged that whilst s 5 threshold had been crossed, consideration should be given, having regard to community safety, to a community based sentence. It was submitted that the offender’s ongoing rehabilitation would be impaired by a full time custodial sentence and in any event, she had been assessed as a low risk of reoffending. As she was now being treated for her Borderline Personality Disorder with medication, it was unlikely that she would repeat her criminal conduct. It was submitted that if the court came to an aggregate sentence of three years or less, an Intensive Correction Order should be considered with appropriate conditions.

The Crown submissions

57. The Crown also relied on a thorough and detailed written outline of submissions. It set out general principles of sentencing in respect of offences involving fraud. The following features were said to have universal application to the assessment of the objective seriousness of the offending:

“(a) The amount of money involved.

(b) The length of time over which the offences are committed.

(c) The motive for the crime.

(d) The degree of planning and sophistication.

(e) An accompanied breach of trust (authorities and citations omitted).”

58. It was submitted that the court should also have regard to the impact on public confidence and the impact on the victims as relevant matters.

59. The Crown noted that the offender was unlikely to be ever in a position to pay compensation for either offence. Affirmations had been reimbursed by the bank involved in relation to their loss, however, the Crown submitted that that effectively merely transferred the loss from Affirmations to that bank.

60. The Crown submitted that it was open to the court to make a finding that the offender’s motivation was based on greed, and in respect of the offences against Dr Govan, a form of retaliation for what she perceived to be her mistreatment during their relationship. At the time of leaving his employment, the offender was on notice that Dr Govan suspected that she had been defrauding his business. The Crown submitted that it would be inappropriate to find, on the balance of probabilities, that the offender was the victim of sexual harassment whilst employed at Affirmations, on the bare allegation contained in Ex 1. It was submitted that it was open to the court to find that her motivation in respect of Count 2 was a result of her feelings slighted by her employer, or that the allegation of sexual harassment was an attempt to victim blame. This involved evidence of a lack of remorse and a reluctance to take responsibility for the offending.

61. The Crown submitted that each of the offences involved a degree of planning and sophistication in producing fraudulent documents, and that the offending also involved a substantial breach of trust in respect of each count. In respect to Count 1, the offender had used her relationship with Dr Govan and her senior position within the medical practice to deflect scrutiny.

62. The Crown submitted that application of the principles outlined above meant that anything less than a full time custodial sentence would not be appropriate in the circumstances.

63. The offender was entitled to a 25% discount for her early plea of guilty. The Crown submitted the following aggravating factors should be taken into account pursuant to s 21A(2):

“(j) The offence was committed while the offender was on conditional liberty in relation to the mid-range PCA in 2015. It was noted that the conditional liberty was a s 10 bond, and therefore was at the lowest end of conditional liberty.

(k) The offender abused a position of trust and authority in relation to both victims.

(m) Each offence involved a series of criminal acts.”

64. The Crown submitted that the court would need to take care not to double count in the assessment of the aggravating features, having regard to the assessment of objective seriousness of offending generally.

65. The Crown conceded that the following mitigating factor feature was present pursuant to s 21A(3)(k), namely, the plea of guilty.

66. Based on the limited criminal history of the offender, the Crown submitted that it would be inappropriate to provide any significant leniency to the offender.

67. The Crown referred to the maximum penalties proscribed by Parliament, and the need for specific and general deterrence set out in the purposes of sentencing under 3A of the Crimes (Sentencing Procedure) Act 1999 (“CSPA”). General deterrence was of considerable importance here due to the breach of trust and responsibility involved, and the way in which the offender used her relatively senior position within each business to defer and avoid detection.

68. In his oral submissions, the Crown submitted that the court would exercise considerable caution in determining whether there was a causal connection between the offender’s mental health and the offending. Her work performance and attributes outlined in the resume (Ex B), was in direct contrast to her psychological assessment. Whilst acknowledging that the resume involved putting her work history in the best possible light, it still did reflect her capabilities as a skilled employee.

69. The Crown submitted that the period of time during which the offending took place here was not short. The combined deceptions took place over a period of nearly three years.

70. The Crown conceded that the offender’s mental health issues may be taken into account pursuant to CDPP v De La Rosa, supra. It was also conceded that she may be vulnerable in custody, given her mental health issues and self-harming, notwithstanding that her presentation, size and demeanour were not particularly unusual and therefore should not be given weight in determining whether she would suffer hardship in custody.

71. The Crown submitted that the previous Commonwealth offence should be taken into account. The amount concerned, approximately $16,000, was not insubstantial.

72. The Crown submitted that the delay in the second offence was explained by the fact that the offender was new in the job, there was significant risk involved in the offending, and that she waited and worked out the “lay of the land” before she offended.

73. The Crown submitted that the principles in R v Todd, supra, as to delay were not relevant here. Further, the court could not hold that the offending in Count 2 is less serious than Count 1, because notwithstanding that the offending amounted to approximately $20,000 less than Count 1, it took place in a much shorter period and therefore the rate of loss to the employer was higher. Further, little weight could be given to her confession to the manager as remorse because at that time she was aware that she had been caught. Having regard to the Agreed Facts, the court would not be satisfied that she was genuine in her remorse for the offending.

74. With respect to Count 1, the Crown submitted that there was a double breach of trust, given that she was Dr Govan’s employee and in a relationship with him. However, the Crown submitted that there was a risk of over-counting on sentence in having regard to that, notwithstanding the level of deception involved.

75. The matters put on behalf of the offender in respect of Count 2 amounted to victim blaming. Further, the offending in Count 1 involved some retaliation for her mistreatment in the relationship with Dr Govan. It was submitted that the motive here was clearly greed and that the offender was living well beyond her means. Notwithstanding that there was no evidence of an extravagant lifestyle, the monies were used partly to educate her only son in an elite boarding school.

76. The Crown submitted that in all of the circumstances, a full time custodial sentence was warranted. Significant weight should be given to general deterrence and the breach of trust involved in the fact that two separate businesses were defrauded. There should therefore be significant accumulation in sentence.

77. Whilst the offender was entitled to a 25% discount on sentence, it was really a plea of guilty where there was no option, given a strong prosecution case on each count.

78. Specific deterrence was also important in the sentencing process here. The Crown submitted that an Intensive Correction Order would not properly give weight to the matters set out in s 3A of the CSPA. Notwithstanding her low risk of reoffending, there should be a full time custodial sentence. The Crown conceded that there could be a finding of special circumstances here.

Determination

79. Section 3A of the C(SP)A sets out the purposes of sentencing as follows:

“3A The purposes for which a Court may impose a sentence on an offender are as follows:

(a) To ensure that the offender is adequately punished for the offence,

(b) To prevent crime by deterring the offender and other persons from committing similar offences,

(c) To protect the community from the offender,

(d) To promote the rehabilitation of the offender,

(e) To make the offender accountable for his or her actions,

(f) To denounce the conduct of the offender,

(g) To recognise the harm done to the victim of the crime and the community.”

80. The objective seriousness of the offending in respect of Count 1 was within the mid-range of an offence pursuant to s 192E of the Crimes Act 1900. The offending involved some 71 fraudulent transactions over a period of two years, amounting in a total of $146,261.16. The offending involved the offender taking advantage of her position in the organisation as financial manager of the medical practice of Dr Govan, and also of her personal relationship with him. It was motivated by greed, in the sense that she was living beyond her means, and a misplaced sense of entitlement arising from her relationship with her employer. Having regard to the amount of money involved, the length of time over which the offence was committed, and the fact that it involved numerous fraudulent transactions that involved a significant amount of planning and sophistication, together with the gross breach of trust, it was serious offending in the mid-range, but towards the lower end of the mid-range for an offence pursuant to s 192E, which can also account for offences involving millions of dollars.

81. Similarly, the objective seriousness of the offending in Count 2 was within the mid-range for an offence pursuant to s 192E. Again, the offending involved a gross breach and abuse of trust placed in her by her employer, and a degree of sophistication and planning, which meant that she waited some period of time which coincided with her appointment as financial controller, before she commenced the first of numerous transactions. Further, she was motivated by greed, in the sense that she was living beyond her means. Again, the offending fell towards the lower end of the mid-range for an offence pursuant to s 192E. It could not be said to be less serious than Count 1, given that the amount was still large, albeit $20,000 less, but had been obtained in less than half the time period of the offending in Count 1. For the same reasons outlined above, in respect of Count 1, it fell within the lower end of the mid‑range of objective seriousness for an offence pursuant to s 192E.

82. I accept the Crown’s submission that aggravating features pursuant to s 21A(2) of the CSPA here were as follows:

“(j) The offences were committed whilst the offender was on conditional liberty.

(k) The offender abused a position of trust and authority in relation to each victim, and

(m) Each offence involved a series of criminal acts.”

83. I further accept the following mitigating factor pursuant to s 21A(2)(k), namely, that the offender entered an early plea of guilty, thereby entitling her to a utilitarian discount of 25% on sentence.

84. I have been careful not to double count the aggravating features on sentence here, given that the offences involve fraudulent breaches of trust by the offender of her relationship with her employers, and a degree of planning and sophistication to avoid detection.

85. The maximum sentence of 10 years imprisonment proscribed by Parliament is important in the sentencing process as a guidepost, and I have taken it into account in each case.

86. Also important are principles of general deterrence. Because such offences invariably involve a serious breach of trust and are usually only able to be committed because of a good character of the offender, who has been placed in the position of trust, general and personal deterrence are of particular significance. Given the planning and sophistication, and systematic dishonesty involved in the offending, and the difficulty in detecting such criminal conduct, a clear message must be sent to the community that such criminal conduct by employees will result in the imposition of lengthy prison sentences in appropriate cases. Similarly, personal deterrence is important here, given the seriousness of the criminal conduct involved.

87. I have taken into account the subjective factors submitted on behalf of the offender. She is a 45 year old single mother, and has been assessed as having symptoms of a Borderline Personality Disorder. She did not give evidence before me, and therefore in accordance with authority, I have been cautious in making findings based on her report to a psychologist employed for the purpose of providing a report to the court on sentencing. I do not find that there is any causal connection between the offender’s mental health issues and her offending. Rather, her motivation in respect of each count was greed, and the fact that she was living beyond her means was causative of the offending in each case. In respect of Count 1, also relevant was a sense of entitlement that arose from her relationship with her employer. I do not accept her submission that that relationship was “obviously inappropriate”. The degree of planning, sophistication involved and her ability to cover up her offending bespeak of a calculated course of criminal conduct in each case. Over the course of almost three years during which she offended, the offender was functioning in a responsible business position and there is no evidence suggesting her symptoms affected her at that time. In accordance with CDPP v De La Rosa, supra, her mental health issues may be taken into account in assessing her moral culpability for her offending and in diminishing the impact of general deterrence, as well as contributing to hardship whilst in custody. I have taken those matters into account, but note there is no evidence of a diagnosis of Borderline Personality Disorder. Ms North, as forensic psychologist, has identified the criteria for that condition, but is not qualified to make a diagnosis. I do accept she is being treated by her GP for depression, and receiving counselling for anxiety management.

88. Whilst I accept that the offender confessed her guilt to the manager of Affirmations, no such acknowledgement was made in respect of Count 1, which was not discovered for some time after the offender left Dr Govan’s employment. Further, the confession was made in the face of what must have been a strong case, given that her fraud had been uncovered and that she was aware of it.

89. The offender is entitled to a 25% discount on sentence and I find that she has expressed remorse for her criminal conduct, both to the psychologist and in her letter to the court. The fact that no restitution has been made by the offender, notwithstanding that she has continued to work, does not support any further leniency in sentencing on the basis of remorse. However, I find that the offender has accepted responsibility for her actions and acknowledged the loss and damage caused by her criminal conduct.

90. Her otherwise good character, as evidenced in Ex 2, is to be given little weight in sentencing, given that it enabled the criminal conduct by placing her in a position of trust with both employers. In any event, it was somewhat tarnished by her previous conviction for a Commonwealth social security fraud, where she omitted to disclose earnings which would have affected her level of benefit. However, the conviction occurred some 13 years ago, and involved conduct almost 18 years ago, and therefore does not disentitle her to leniency of itself. The fact that she was on a s 10 bond for a driving offence is also of little weight here in the sentencing process, as it represents the lowest level of conditional liberty.

91. I am not satisfied on the balance of probabilities that her offending occurred as a result of any sexual harassment in the workplace, in respect of Count 2. There is no evidence before me other than the self-report to the psychologist, which remains untested, and the offender gave no evidence of the allegation herself. Rather, the offender’s offending was borne of the fact that she was living beyond her means, educating her son in a private school, and therefore her motivation was greed. It is also relevant that the offending in Count 2 did not commence until some eight months into her employment with Affirmations, when she was promoted to the position of financial controller.

92. I am satisfied that the s 5 threshold has been crossed in relation to each offence, and that, applying a 25% discount in respect of each offence, an appropriate penalty would be 2 years and 3 months imprisonment in each case. There must be some accumulation on sentence here, notwithstanding that principles of proportionality and totality must be applied in the sentencing process. The principle of totality was explained by Howie J in Cayahdi v R [2007] NSWCCA 1; 168 A Crim R 41 at [27]:

“There is no general rule that determines whether sentences ought to be imposed concurrently or consecutively. The issue is determined by the application of the principle of totality of criminality: can the sentence for one offence comprehend and reflect criminality for the other offence? If it can, the sentences ought to be concurrent otherwise there is a risk that the combined sentences will exceed what is warranted to reflect the total criminality of the two offences. If not, the sentences should be at least partly cumulative, otherwise there is a risk that the total sentence will fail to reflect the total criminality of two offences. Similarly, where they are part of a single episode of criminality with common factors, it is more likely that the sentence for one of the offences will reflect the criminality of both.”

93. It is clear that the sentence must reflect the totality of the criminality involved. In applying those principles here, I find that an aggregate sentence pursuant to s 53A of the Crimes Act is appropriate, and that the offender should be sentenced to a term of 3 years imprisonment.

94. The principles of delay in sentencing relied on by the offender in R v Todd, supra, do not apply here. Because of the sophistication involved in the modus operandi of the offender, the fraudulent conduct was difficult to detect. This meant that it was not until well after she had left Dr Govan’s employment that the criminal conduct in Count 1 was completely revealed. Similarly, her criminal conduct in Count 2 was not detected by her employer for some time. I do not find that any delay in sentencing in those circumstances should lead to a reduction on sentence.

95. I have considered whether that sentence should be served by way of an Intensive Correction Order. In considering that, the question of community safety is of paramount importance pursuant to s 66(1) of the CSPA. However, it has to be weighed against the purposes of sentencing set out in s 3A of the CSPA as above. In R v Pullen [2018] NSWCCA 264, Harrison J said as follows at [84]:

“84 In determining whether an ICO should be imposed, s 66(1) makes ‘community safety’ the paramount consideration. The concept of ‘community safety’ as it is used in the Act is broad. As s 66(2) makes plain, community safety is not achieved simply by incarcerating someone. It recognises that in many cases, incarceration may have the opposite effect. It requires the court to consider whether an ICO or a full-time custodial sentence is more likely to address the offender’s risk of re-offending. The concept of community safety as it is used in the Act is therefore inextricably linked with considerations of rehabilitation. It is of course best achieved by positive behavioural change and the amendments recognise and give effect to the fact that, in most cases, this is more like to occur with supervision and access to treatment programs in the community.”

96. In R v Fangaloka [2019] NSWCCA 173, Basten JA (with whom Johnson and Price JJ agreed) set out the purposive of approach to be utilised in determining whether a sentence should be served by way of an Intensive Correction Order, in accordance with the purposes of sentencing set out in s 3A of the Act. His Honour held (at [60]) that there was no express obligation to consider whether a sentence of imprisonment should be served by way of an Intensive Correction Order. His Honour went on to state at [61]:

“I would not construe the relevant provisions in s 7 and Pt 5 of the Sentencing Act as imposing such an obligation. However, the fact that the power to consider imposing an ICO exists invites a further question as to the basis upon which a court should decline to consider imposing an ICO. That must include cases where the court is satisfied, not only that there is no alternative to a sentence of imprisonment, but also that factors not limited to deterrence and rehabilitation of the offender require no lesser sentence than one involving a full time custodial term. It may be because of the need for adequate punishment, for general deterrence, for denunciation or for recognising the harm done to the victim and the community.”

97. Here, the purposes of sentencing as set out in s 3A, as outlined by Basten JA above, have to been given full weight in determining whether to exercise the power to impose an ICO. Whilst the offender has been assessed at a low risk of reoffending, that assessment comes about by her own criminal conduct, which means that she would be most unlikely to ever be placed in a position of financial trust again. The offender here is not the type of offender identified in R v Pullen, supra, as being the most likely to be assessed as suitable for an ICO, i.e,mainly “a young offender with limited or no criminal history and excellent prospects of rehabilitation” (see [87]). As the Court of Criminal Appeal set out in that case, a balance must be struck and appropriate weight must be given to all relevant factors which must be taken into account in arriving at the appropriate sentence. The court went on to recognise that the imposition of an ICO does represent some degree of leniency.

98. In Fangaloka, supra, Basten JA went on at [63] and following to outline the correct approach in considering an ICO pursuant to s 66. At [64] his Honour said:

“The first purpose of sentencing, identified in s 3A(a) of the Sentencing Act is ‘to ensure the offender is adequately punished for the offence’. It is a fundamental principle of longstanding and requires that the sentence be reasonably proportional to the offending.”

99. His Honour went on to state at [66]:

“In short, there is nothing in s 66 which favours an ICO over imprisonment by way of full time custody. Further, while s 66 expressly referred to s 3A, it did so, not by identifying it as a set of ‘subordinate’ considerations, but as mandatory considerations. It would be wrong for a court to treat every consideration other than the means of addressing the risk of reoffending as a subordinate consideration.”

100. Relevant to this issue is the hardship the offender may suffer given her symptoms of Borderline Personality Disorder, and her inclination to self‑harm. Whilst the offender may suffer some hardship in custody, that hardship can be ameliorated by appropriate treatment by Justice Health. Given the serious nature of the offending, and the significance of general deterrence, notwithstanding those mental health issues, I am persuaded that a full time custodial sentence is warranted in all of the circumstances here.

101. I do find special circumstances pursuant to s 44(2) of the CSPA based on the offender’s mental health issues, and her need for rehabilitative treatment for that condition and her drug and alcohol issues. I therefore propose the vary statutory ratio between head sentence and non-parole period and impose a non-parole period of 18 months.

Orders

102. I make the following orders:

1. You are convicted of Count 1 and Count 2, namely the two offences pursuant to s 192E(1)(a) of the Crimes Act 1900, of dishonestly obtain property by deception.

2. I sentence you by way of an aggregate sentence pursuant to s 53A of the CSPA 1999.

3. You are sentenced to a non-parole period of 18 months to date from 29 August 2019 and terminate on 28 February 2021.

4. The balance of term will be 18 months to date from 29 February 2021 and terminate on 28 August 2022.

5. The indicative sentences in respect of each count are as follows:

1. Count 1 – 2 years and 3 months imprisonment.

2. Count 2 – 2 years and 3 months imprisonment.

6. I direct the Registrar to forward to the Department of Corrective Services a copy of the report of Ms North dated 11 August 2019 (Ex 1).

7. Your parole eligibility date is 28 February 2021.

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Amendments

02 September 2019 - Counsel for Offender's name corrected to D McMahon

Decision last updated: 02 September 2019