R v Faint
[2011] QDC 45
•18 April 2011
DISTRICT COURT OF QUEENSLAND
CITATION:
R v Faint [2011] QDC 45
PARTIES:
THE QUEEN
v
TONY ROBERT FAINT
FILE NO/S:
DC 7034 of 2009
DIVISION:
Criminal
PROCEEDING:
Contested Sentence
ORIGINATING COURT:
District Court of Queensland, Bundaberg
DELIVERED ON:
18 April 2011
DELIVERED AT:
Bundaberg
HEARING DATE:
14 April 2011
JUDGE:
Clare SC DCJ
ORDER:
Convictions are recorded.1.
r Faint is sentenced to imprisonment for 18 months.For count 1, M2.
For count 2, he is sentenced to imprisonment for 4 years. 3.
The terms of imprisonment are to be served concurrently. The period of imprisonment is to be suspended after a period of 15 months. Mr Faint must not commit another offence punishable by a period of imprisonment within a period of 5 years if he is to avoid being dealt with for the suspended term of imprisonment.4.
There has been no period of pre-sentence custody.5.
CATCHWORDS:
CRIMINAL LAW – SENTENCE – CONTESTED- where defendant pleaded guilty to 2 counts of stealing as a servant-where dispute as to amount stolen in respect of count 2- where there has been a delay between the commission of the offence and sentencing.
Criminal Code 1899 (Qld), s 391, 398
R v L; ex parte Attorney-General [1996] 2 Qd R 63.
COUNSEL:
Ms S.J. Farnden for the Crown
Mr M.J. Woodford for defendant
SOLICITORS:
Director of Public Prosecutions for the Crown
Family Law- Doyle, Keworth & Harris for the defendant
CLARE DCJ: Tony Faint has pleaded guilty to 2 counts of stealing as a servant. He had been the retail manager of the Sugarland Tavern until his dishonesty was discovered. He admitted stealing $15,000 from the till over the preceding 14 months. He did that by simply entering void transactions. The theft of the cash is count 1. Mr Faint also admitted stealing property from his employer in the last few months of his employment. The theft of property is count 2. Mr Faint admitted the theft of a boxed set of Jack Daniels Whiskey which he had advertised for sale on eBay. The prosecution alleged that the dishonesty for count 2 extended much further than the 3 bottles of Jack Daniels. The allegation was that more than $90,000 worth of alcohol was stolen and that Mr Faint covered it up in 2 ways, namely by not recording stock that was delivered and by entering fake credit notes into the system to reduce the volume of stock on record.
The theft of $90,000 worth of alcohol was in contest. If proven, it would radically transform the level of criminality in count 2 from a relatively minor offence to one of sustained and substantial offending. The prosecution called Mr Faint’s supervisor and 2 people who had reviewed the company records after Mr Faint was sacked. A recording of Mr Faint’s interview with police was tendered. No additional witnesses were called by the defence. The defence submission was that the crown case for the systematic theft of the alcohol fell short of proof.
There is no direct evidence that Mr Faint took the alcohol. The prosecution case for it is entirely circumstantial. As regards the balance of probabilities test in section 132C of the Evidence Act 1977, the significance of the contested issue calls for the highest level of satisfaction. I proceed on the basis that the theft of the alcohol would not be proved against Mr Faint unless it was the only reasonable conclusion open on the evidence.
It is common ground that alcohol was missing from the Tavern’s stock. The extent of the discrepancy however was in dispute. The issues were whether stock was stolen and, if it was stolen, who took it and how much of it.
Admissions
Mr Faint was stealing cash from the registers for 14 months. It is common ground that he got the money by entering void transactions. He attempted to disguise his own conduct by using the identification bands of his staff to make the transactions. He was finally seen on security footage. When confronted about it, he admitted to taking 2 amounts from the till for a total of $770. Knowing there was to be an investigation, he later increased that amount to $3,000 taken in the course of the last month. After an audit, he accepted that the true amount was $15,000.
Police put the substantive allegations of count 2 to Mr Faint. He denied any knowledge of what had happened to the alcohol but he did admit to corrupting the Tavern’s records. He initially implied that he had not known of any shortfall in the stock. He said that no one had told him, commenting: “Hindsight is a wonderful thing”. It soon became apparent that he had not only known of large deficiencies but he had deliberately concealed them by falsifying the records. It is difficult to place great weight on his denials in the face of his demonstrated facility for deceit.
Computer records
It is common ground that the computer records were seriously distorted. The only person who could have done that was Mr Faint. He was the only person entering relevant data onto the computer system. He admitted that he had input false figures for incoming deliveries and for stock take. He also admitted fabricating credit notes and feeding them into the system. The effect of those false entries was to reduce the volume of stock on record without any reduction in the total cost of stock. Mr Faint accepted that he did this to balance the books. The practical effect was to conceal the fact that stock was missing.
It was put to Mr Newberry under cross-examination, that the manipulation of the records was authorised by him. He denied that, while acknowledging that a $500 to $1,000 variation, whether up or down, was viewed as acceptable for the stock take because of the size of the turnover. His evidence was this was the margin of tolerance. It was not authority to falsify figures to reach that acceptable level. He was referred to a stock take note made by Mr Faint in the months before count 2. It said: “there are many issues” between venues within the tavern complex and that Mr Faint had tried to “fix them as best as I can.” Not surprisingly, Mr Newberry understood this to mean that Mr Faint had endeavoured to track back to the correct position.
How much stock was missing?
After Mr Faint’s dishonesty came to light, the Tavern management endeavoured to identify what was missing. Firstly, each invoice signed off by Mr Faint was analysed against the amount of stock Mr Faint had recorded on the system as received in the delivery relating to the invoice. The overall shortfall in recorded stock was about $30,000.
Secondly, fake credit notes were identified and added up. Their total value was just over $60,000. There is no suggestion that anyone other than Mr Faint falsified credit notes. All credit notes that were not legitimate copies of credit notes from the supplier had been created in the same way. They would have appeared suspicious upon examination by anyone with knowledge of the business. They all recorded a nil credit. They all bore a fake invoice number which was in fact the date of the delivery. Mr Faint admitted to using that method. He was the only person who input credit notes onto the computer system. It is reasonable to conclude that he was responsible for all of the fake credit notes found for this period.
Mr Woodford submitted that the figure of $90,000 calculated through those methods was meaningless. He argued that the data was now so badly corrupted that the expertise of a forensic accountant was required to sort it out. A forensic accountant had not been used. The stock take, undertaken a month after Mr Faint had gone, only produced a deficiency of $9,000. The evidence did not establish whether this was before or after the business records had been corrected. Mr Woodford argued from this that the total discrepancy could then be as small as $9,000.
Mr Faint said that he not only adjusted down, but he also had to adjust up, when there was an excess of stock. He nominated 2 types of legitimate correction he had made. On one occasion staff had told him that an extra bottle of rum had been received. On other occasions he realised that changes in the suppliers’s packaging from cartons of 12 bottles of wine to cartons of 6 meant that he had over counted the bottles received. He indicated that he was alerted to this during stock take. Mr Newberry accepted that there had been some issues with the packaging of wine, but he said it was not a significant problem. The schedule of facts itemises the differences between the invoices and what was recorded on the tavern’s computer system. Mr Faint’s explanation to police did not suggest there had been an error in the invoice, but rather a miscounting in his own data entry. If that was so, it was not an error which would show up as a shortfall in his recording of the stock. Even if one were to make allowance for the possibility that the error was on the invoice, only 3 entries for cartons show up as half of the invoice quantity of bottles. They total $747.
The investigation of the records for the period of count 2 did not appear to identify any adjustment to increase the recorded amount of stock. The only adjustment was to deplete the amount of stock on record. In any event, as I understand the method adopted to assess the discrepancy, the net figure produced was the net difference between invoices and stock entered onto the system. The overall shortfall was $30,000. Similarly, the analysis of the credit notes identified that nothing was ever actually credited back to the company. The adjustment was to reduce stock, not increase it.
The gross deficiency with stock is also consistent with Mr Faint’s own version. The flavour of his account to police was that he knew there was a serious shortfall and he had known from January, which was the start of the offence period. He said that he had not known how to deal with a problem of “that magnitude”.
Was the stock stolen?
The only possibilities were that the missing stock was not delivered or that it was stolen after delivery either by Mr Faint and/or his staff. Responsibility for incoming stock, the recording of it and its movement fell to Mr Faint. As the retail manager he was the officer accountable. He had worked at the hotel for 7 years. He signed off on the invoices. He was also the forklift driver who unloaded the delivery trucks and moved the pallets to the various locations within the tavern complex. He maintained that he never checked whether an invoice was accurate. He signed without verifying the delivery. At the same time, on his own account, he was aware that stock was not reaching the shelves. He was writing down an enormous volume of stock. He indicated he was troubled by the issue and that he had not known the reason for the shortfall, whether it was in the delivery or with his staff. Four staff were identified by Mr Faint as suspects. Two had provided statements denying any responsibility. One had stopped working before the offence began. The fourth continued to work at the Tavern but had failed to provide a statement.
Mr Faint maintained that notwithstanding his suspicions, he never checked the deliveries. He said this was done by his staff, the people he suspected of stealing. He said they never told him of a shortfall. He never took any steps to investigate what was happening or to put safety checks in place. According to the staff, Mr Faint had actually put an end to the process of cross checking invoices and deliveries that had been in place under the previous manager.
Mr Faint did not discuss the issue with staff or management. He said he did nothing about it. He said he put his head in the sand. In truth, he did take action. He concealed the deficiencies by altering the business records. The explanation he gave was a desire to protect his staff, in case one of them was the thief. It is a completely implausible explanation. He was the manager and the person responsible for the stock. He engaged in a cover up in a way that would obviously jeopardise his job, his reputation and even his freedom. The proposition that an innocent manager would do that and allow the situation to continue simply defies credulity. Moreover, Mr Faint’s portrayal of himself as a caring, protective boss is at odds with other treatment of his staff. He had repeatedly incriminated his staff to protect himself. He was using their electric identification bands to steal the money in count 1. He had thereby chosen to put his staff in jeopardy to protect his own offending. Furthermore, he did in fact report one staff member for stealing. This was during the period when Mr Faint was stealing the cash. He reported the employee on suspicion of stealing one 6 pack of rum. He indicated that he had done that without any hesitation at all. He said would take any opportunity to damage that man. “If I could bring up anything against him I would.”
Other staff
According to Mr Faint, none of his staff had reported deficiencies in deliveries over the offence period, although they had once reported the extra bottle of rum. On his account, they were in a position to know the true state of the deliveries because they were doing the checking. If that was correct, it suggests that the shortfall was not in the delivery because the volume of missing stock would be noticed. Further it tends against the theory that his staff were involved in the theft, independently of Mr Faint. Any staff member stealing large quantities of stock would have to realise that the theft would come to light through Mr Faint’s monthly stock take. The obvious way for guilty staff to divert suspicion from themselves would be to sound an alarm before stock take. The best opportunity to do that would be with the checking of fresh deliveries. If Mr Faint was not involved in the offence, the guilty person would have no reason to think that the retail manager would falsify records to hide the theft. A reasonable expectation would be that he would bring on an investigation rather assume the risk for himself. The absence of any attempt by staff to hide the shortfall makes it less likely that staff were involved independently of Mr Faint.
Police did not find a money trail or any large quantity of alcohol at Mr Faint’s house. Mr Faint however had been selling alcohol on eBay using the liquor licence of the tavern. He told police that what he sold was his own collection and had taken between $3,000 and $4,000 dollars in sales. He had used the hotel liquor licence. The crown prosecutor was prepared to concede that she could not prove that the alcohol sold was stolen. The strength of a circumstantial case comes from the combined force of the circumstances, rather than the individual facts viewed in isolation. The fact that Mr Faint sold a significant amount of alcohol during the period of the offence is another relevant circumstance. I accept the evidence of the tavern manager, David Newberry, that he neither authorised nor knew of Mr Faint’s sale of alcohol on eBay using the tavern’s licence.
Findings of fact
The irresistible inference from the evidence and facts presented is that Mr Faint stole the alcohol. The conclusion follows from the enormous volume of missing stock, Mr Faint’s awareness of it, his deliberate concealment of it and his complete failure as manager to respond in any appropriate way, either by reporting the matter or investigating it or taking any security measures to prevent a recurrence. There is no credible innocent explanation for that. It is not possible to determine whether he acted alone or with other staff, but it is clear that his role was pivotal to the offending. I am satisfied that the value of the stock he stole was in the vicinity of $90, 000.
Considerations on sentence
Mr Faint falls to be sentenced for the theft of cash and property of a value approaching $100, 000. For 14 months he exploited his position of responsibility over a vast turnover of alcohol to steal from his employer. He succeeded because of his trusted reporting position and his knowledge of the weaknesses in the accounting system. He had attempted to disguise his own involvement by using the identities of other staff. It was calculated and persistent offending. He only stopped because he was caught.
He was a middle aged man with no criminal record and a good work history. He pleaded guilty. He confessed to count 1 at an early stage and has repaid $15, 000. The cooperation in relation to count 2 was more limited, although he did effectively admit to concealing the offence.
He told police that he did not steal out of need, but out of resentment. He said he thought other staff were receiving cash in hand bonuses. He claimed to have spent what he stole on holidays around Queensland. He denied that he was under financial stress because of IVF expenses. Sadly, Mr Faint and his wife had been on the IVF program for a number of years, without success. The cost was over $80,000. Mr Faint said he paid for the treatment on credit card. Notwithstanding his denials, that must have placed a great deal of financial pressure on an ordinary working couple. Mrs Faint was in the courtroom supporting her husband. Her distress was self evident. It is clear that she has suffered a great deal.
Delay
Mr Woodford has emphasised the delay in this matter. Mr Faint lost his job in March 2007. He gave his interview the following month, which is 4 years ago. He was not served with the notice to appear until December 2008, some 20 months later. The committal hearing was not contested. An indictment was presented in November 2009 but resolution was delayed due to discussions between the parties, crown requisitions and uncertainty as to how the factual dispute in count 2 ought to be resolved.
The lapse of time between the commission of an offence and sentencing will not be a mitigating factor unless the delay had resulted in some unfairness to the offender. A sentence should be mitigated: where the delay between charging and sentence impaired the offender’s freedom or caused some prejudice and where in the interim the offender demonstrated rehabilitation.[1]
[1]R v L; ex parte Attorney-General [1996] 2 Qd R 63.
The 14 month offending period appears to have been the only period of criminal behaviour in Mr Faint’s life. Apart from those 14 months it appears he was law abiding and worked hard. The offending was 4 years ago. There is no apparent need for personal deterrence. The sentence however must meet the needs of denunciation and general deterrence. Businesses are vulnerable to dishonesty from trusted managers. To deter the offending, the punishment must outweigh the financial return. Delay is common in such cases where part of the offending involved the destruction of proper records. Here the prosecution does accept responsibility for some of the delay. Even so, the level of reduction must not go so far as to make the financial return worth the punishment.
The sentence
Convictions are recorded.
For count 1, Mr Faint is sentenced to imprisonment for 18 months.
For count 2, he is sentenced to imprisonment for 4 years.
The terms of imprisonment are to be served concurrently. The period of imprisonment is to be suspended after a period of 15 months. Mr Faint must not commit another offence punishable by a period of imprisonment within a period of 5 years if he is to avoid being dealt with for the suspended term of imprisonment.
There has been no period of pre-sentence custody.
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