R v Naufahu
[2021] NZHC 217
•19 February 2021
SUPPRESSION ORDERS EXIST: SEE [57] IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CRI-2019-004-3382
[2021] NZHC 217
THE QUEEN v
PASILIKA NAUFAHU
Hearing: 19 February 2021 Appearances:
D G Johnstone and E Palsenbarg for Crown R M Mansfield and H Smith for Defendant
Judgment:
19 February 2021
SENTENCING REMARKS OF LANG J
Solicitors:
Crown Solicitor, Auckland
R v PASILIKA NAUFAHU [2021] NZHC 217 [19 February 2021]
[1] Mr Naufahu, you appear for sentence having been found guilty by a jury on a charge of conspiring to supply the class B controlled drug pseudoephedrine1 as well as two charges of money laundering.2 Shortly before your trial you pleaded guilty to four further charges of money laundering, a charge of participating in an organised criminal group3 and being in unlawful possession of ammunition.4
Factual background
[2] The sentence to be imposed on you rests on two factual bases. First, the agreed summary of facts tendered to the Court when you entered your guilty pleas prior to trial. Secondly, the evidence given at trial on the charges to which you maintained your pleas of not guilty.
Money laundering and participating in an organised criminal group
[3] The charge of participating in an organised criminal group was laid as a result of the fact that over a lengthy period you and others were involved in laundering money derived from criminal activity. As the charge of conspiring to supply pseudoephedrine demonstrates, that activity was most likely to have been dealing in drugs although the Crown could not point definitively to any other such activity.
[4] At all material times you were the President of the Comanchero organisation. Other members of the organised criminal group were also either patched members or associates of that organisation. You combined your various talents to become involved in laundering money derived from criminal activity, most likely the sale of drugs.
[5] You steadfastly deny you were involved in drug dealing activities, but the jury’s verdict makes it clear you were involved in the purchase of pseudoephedrine for the purposes of supply on at least one occasion. I also consider your conviction on that charge provides useful insight into the modus operandi of your organisation as a whole. It demonstrates that to some extent you were involved in drug dealing activity
1 Misuse of Drugs Act 1975, ss 6(1)(c) and (2A)(b). The maximum penalty is 10 years imprisonment.
2 Crimes Act 1961, s 243(2). The maximum penalty is seven years imprisonment.
3 Section 98A. The maximum penalty is 10 years imprisonment.
4 Arms Act 1983, s 45(1). The maximum penalty is four years imprisonment and/or $5,000 fine.
that you conducted from a distance using intermediaries and agents to minimise the risk of the offending being detected. In my view there is no other realistic reason why you and other members of the group would ultimately be the persons who stood to benefit from the proceeds of drug dealing activity. I have no doubt you also had an interest in at least some of the transactions that produced the funds to be laundered.
[6] You became involved in a sophisticated money laundering operation using the services of a solicitor, Mr Andrew Simpson. You were introduced to him by one of your associates, Mr Donald Vuisevuraki. Mr Simpson told you how to deposit cash into his trust account so it would not be flagged by the authorities. This involved depositing multiple quantities of cash into his trust account in sums less than $10,000. You did not do this yourself. Instead you and Mr Simpson arranged for Mr Donald Vuisevuraki to deposit the cash into Mr Simpson’s trust account on several occasions. Mr Simpson himself also assisted directly in that activity, as did another person co-opted by Mr S, Ms Sandhya Nand.
[7] The funds that were paid into Mr Simpson’s trust account in this way amounted to approximately $1.2 million. These funds were then distributed in a manner that enabled you and other members of the group to obtain assets such as luxury vehicles.
[8] Mr Simpson also set up trusts for you and your brother Vetekina. He transferred funds that had been deposited into his trust account into bank accounts operated by the two trusts. In addition, he paid out funds to car dealers to enable you and other members of the group to acquire luxury motor vehicles. Three of these were the subject of charges on which you were either found guilty or to which you pleaded guilty. First, you used cash generated from the group’s activities between February 2017 and November 2018 to meet hire purchase payments on a Ford Ranger motor vehicle purchased in the name of your wife. Secondly, you acquired a Range Rover Sport motor vehicle in May 2018 for the sum of $195,000. Of this sum, $90,000 came from the trust Mr Simpson had set up for your family. Then, in November 2018, you acquired a Bentley Continental motor vehicle for the sum of $139,000. Of this sum Mr Simpson paid $93,000 from his trust account. You paid $5,000 in cash and also
$10,000 using your Eftpos card drawn on an account that was funded in part by cash deposits and payments from Mr Simpson’s trust account.
[9] The most significant asset you acquired in this way was a residential property situated in Bucklands Beach that you purchased in 2018 for use as a residence for yourself and your family. You agreed to pay the sum of $1.388 million for the property. You paid a deposit of $60,000 in August 2018 using cash deposited by Mr Vuisevuraki into Mr Simpson’s trust account. You made further payments of $50,000 and $575,000 in November and December 2018 respectively. All these funds were derived from payments made through Mr Simpson’s trust account.
[10] At trial the jury heard evidence of the attempts your mortgage broker was making at this time to obtain mortgage finance to enable you to complete the purchase of the property. You were unsuccessful in this, because the finance institutions your broker approached were not satisfied with the explanations given regarding the substantial deposits you had already paid towards the acquisition of the property. You ultimately acquired the property in the name of one of your associates, who was able to obtain mortgage finance to enable the purchase to be completed.
[11] A telling aspect of this transaction is the fact that you were prepared to enter into an unconditional contract to purchase the property even though you had not yet obtained mortgage finance. The manner in which the agreement was structured meant you would lose your entire deposit – more than $600,000 - if you were unable to complete the purchase within a few months. You also agreed to pay a considerable sum by way of weekly rent so you and your family could move into the property before you completed the purchase. I consider you were only prepared to take these risks because, as intercepted conversations between you and your broker made clear, you were anticipating receiving substantial sums of money in the near future. In other words, you knew you could rely on a steady and substantial source of future income from the group’s activities.
Conspiracy to supply pseudoephedrine
[12] The charge of conspiring to supply the Class B controlled drug pseudoephedrine was laid as a result of events that the police observed, recorded and filmed between 18 and 21 September 2018.
[13] Late on the evening of 18 September 2018 a person by the name of Mr S arrived in Auckland from Australia. He was a person of interest to the police and they followed him from the airport to his brother’s address in Karaka. The next morning the police followed Mr S as he drove to Howick. The police then observed you meet with Mr S in a café at 9.45 am. You then both travelled to a reserve in the vicinity of your home in separate vehicles. There you continued your discussions. The police saw you using a cellphone during this meeting, but were unable to intercept these conversations even though they had obtained a surveillance device warrant permitting them to intercept communications on all your known cellphones. This suggests you were using an encrypted cellphone during your meeting with Mr S.
[14] Just before noon Mr S left the reserve and was followed by police as he travelled around the South Auckland area. Eventually, just before 6.30 pm, he picked up a person now known to be Mr He Sha. The two men then continued to drive around the South Auckland area for approximately three hours. The events that followed over the next two days suggest they were endeavouring to conclude the sale of a large quantity of pseudoephedrine that day. Those efforts proved unsuccessful and Mr S ultimately dropped Mr Sha off on the side of the road to be picked up by a taxi Mr S had hailed for him. Mr S then returned to the address where he was staying in Karaka.
[15] On the morning of 20 September 2018 Mr S was again observed by the police travelling from Karaka to the Takanini area. He drove around that area for some time before returning to his Karaka address. He was then observed leaving the address in the early afternoon of 20 September 2018. He again went to Takanini and was seen picking Mr Sha up. The two men then continued to drive around the Takanini area. Eventually they stopped on the side of the road. This was in a semi-industrial or commercial area with a significant amount of traffic moving along the road. By this stage the police had obtained a warrant permitting them to install a surveillance device in Mr S’s vehicle. This enabled them to intercept and monitor conversations between Mr S and Mr Sha inside the vehicle. The police also arranged for a surveillance team to follow Mr S’s vehicle as it drove around the South Auckland area and parked at Takanini. At that point they recorded what happened on videotape.
[16] The videotape was played to the jury at your trial and it showed Mr S’s vehicle stopping on the side of the road. A short time later another vehicle stopped and parked in front of Mr S’s vehicle. A patched member of the Comanchero organisation, Mr Connor Clausen, got out of the passenger side of this vehicle. Intercepted communications from Mr S’s vehicle make it clear that Mr Clausen’s vehicle contained cash to pay for a large quantity of pseudoephedrine. Mr S said words to the effect that the quantity involved was worth a million dollars.
[17] The intercepted communications from the vehicle clearly record Mr S directing Mr Sha to go to Mr Clausen’s vehicle and examine the cash. Once he was satisfied the cash was in the vehicle Mr Sha was to arrange for the pseudoephedrine to be brought to the scene by members of his own organisation. The surveillance videotape shows Mr Sha leaving Mr S’s vehicle and going up to Mr Clausen’s vehicle. He was only there a few moments before returning to Mr S’s vehicle.
[18] As matters transpired, the transaction was never concluded. The evidence indicates that the pseudoephedrine never arrived at the scene. Mr Sha told Mr S his associates had cancelled the deal. Mr S was not at all happy about that and endeavoured to persuade Mr Sha to persuade his associates that the deal should proceed that day. After a few more minutes, however, Mr Clausen’s vehicle drove away from the scene. The police then observed Mr S and Mr Sha also driving away. They continued to drive around the South Auckland area for a short period of time before Mr S dropped Mr Sha off.
[19] You were picked up by Mr S the following morning. There was nothing incriminating in the communications the police intercepted in Mr S’s vehicle whilst you were in it. After you had left his vehicle, however, Mr S left a lengthy telephone message for another person indicating that the transaction was still going to proceed and that “Lika’s driver” was to deliver the cash to the place where it was to take place. As it transpires, however, nothing further happened.
[20] By its verdict the jury obviously accepted the Crown’s argument that you were the person who had agreed to acquire a large quantity of pseudoephedrine from Mr Sha’s associates. The jury also accepted you were acquiring it for the purpose of
either supplying it on to others either at a profit or supplying it to others for use in the manufacture of methamphetamine.
[21] Your counsel has endeavoured to argue that the deal effectively was between Mr S and you were not a major participant in it other than to provide a driver. I do not accept that submission. I consider the fact that Mr Clausen arrived at the scene with the cash means that the Comanchero organisation and the organised criminal group as a whole was involved in this transaction. I consider Mr Clausen was acting according to your instructions or those of another member of the group. I therefore consider your role in the transaction was as the ultimate acquirer of the pseudoephedrine, and that you provided the cash to enable that to occur. I do not accept your role was somewhat less as Mr Mansfield has endeavoured to persuade me today.
Unlawful possession of ammunition
[22] The charge of being in unlawful possession of ammunition was laid after the police found six rounds of .357 Magnum ammunition loaded in an imitation pistol when they searched your address on 11 April 2019. The pistol was located between the mattress and the base of the bed in the master bedroom of the address. Although the pistol had been adapted to fire .357 ammunition, subsequent tests showed it was incapable of being fired. For that reason you were only charged with being in possession of the ammunition.
Starting points
[23] Having set out the facts, I now need to fix starting points appropriate for each set of charges. The starting point is the sentence that would be appropriate based on the overall culpability of the offending but leaving to one side factors personal to you.
Money laundering and participating in an organised criminal group
[24] I regard the money laundering charges and the charge of participating in an organised criminal group as forming a single set of charges because the money laundering allegations largely reflect aspects of the activities of the organised criminal group. I therefore propose to fix a starting point on those charges on a global basis.
[25] There is no tariff or guideline judgment of the higher courts in this area of sentencing law because both these offences can be committed in so many different ways. I consider the greatest assistance in fixing the starting point for your offending is to be obtained from sentencing decisions relating to other members of the organised criminal group in which you participated. They are the sentencing remarks in relation to Messrs Daniels, Fonua and Simpson.5 They all pleaded guilty to charges of participating in the same organised criminal group as you and to money laundering charges arising out of the activities of that group.
[26] Mr Daniels is the Vice-President of the Comanchero organisation. He pleaded guilty to nine charges of money laundering, all of which related to the acquisition of luxury vehicles using criminally acquired funds. He also faced one charge of participating in an organised criminal group. The summary of facts on which he was sentenced stated that the total sum laundered by the group was $1.3 million, although he did not receive the direct benefit of that sum. The Judge who sentenced Mr Daniels adopted a starting point of six years imprisonment.6 In doing so, he took into account Mr Daniels’ knowledge of the source of the funds and his leadership role in the organisation. The Judge rejected a submission that Mr Daniels’ culpability was reduced because he was not directly involved in the mechanics of the operation.
[27] The same Judge sentenced Mr Simpson and adopted a starting point of four years six months imprisonment.7 I regard the starting point selected for Mr Simpson as being of less assistance for present purposes because Mr Simpson’s role was different and more specialised than that of you, Mr Fonua and Mr Daniels. Although Mr Simpson received some benefits from the activities of the group these were not at the same level as the benefits received by you and those directly involved in the group’s activities. His role was more that of a functionary who carried out work for the group but did not share in the overall profits of its activities.
[28] Mr Fonua was the Secretary of the Comanchero organisation. He pleaded guilty to one charge of participating in an organised criminal group, one charge of
5 R v Daniels and Simpson [2020] NZHC 275; R v Fonua [2020] NZHC 3107.
6 At [29].
7 At [48].
money laundering and a charge of being in possession of a small quantity of methamphetamine. The money laundering charge related to the acquisition of a luxury motor vehicle that had been purchased for Mr Fonua for $239,000 using laundered funds. I adopted a global starting point of five years imprisonment on the charges of money laundering and participating in an organised criminal group.8
[29] I consider your culpability to be greater than those of any of the defendants to whom I have just referred. You were the President of the Comanchero organisation and, as such, you were in a position of influence to direct the activities of the organised criminal group. You also received the direct benefit of a significantly greater proportion of the laundered funds than did other members of the organisation. Standing alone I am satisfied your overall culpability on the charges of participating in the organised criminal group and money laundering warrants a starting point of seven years imprisonment.
[30] You entered guilty pleas to all but three of these charges on 28 August 2020, some 16 months after having been charged. The pleas came just ten days before the commencement of your trial. You then went to trial on three charges of money laundering. I discharged you on one of these at the end of the Crown case and the jury found you guilty on the other two.
[31] Your guilty pleas were late, but they nevertheless represent your acknowledgement of responsibility for the bulk of the offending reflected in these charges. Having said that, the guilty pleas did not shorten the trial greatly because much of the evidence needed to be traversed in any event. That is obviously not a matter that can be sheeted home to you. In addition, however, the evidence on the charges to which you entered guilty pleas was very strong.
[32] I have heard argument today regarding the fact that you may have been prepared to plead guilty to these charges earlier than you did. The sticking point in discussions between you and the Crown appears to have been the Crown’s insistence that two drugs charges proceed to trial. As matters transpired you were found guilty on one of these and I discharged you on the other at the end of the Crown case. Having
8 R v Fonua, above n 5, at [17].
said that, I direct no criticism to the Crown for maintaining its stance that the charge on which I ultimately discharged you should proceed. It was not until Mr Donald Vuisevuraki had given evidence that the strength of the evidence in relation to that charge could be assessed. The fact remains, as Mr Mansfield accepts, that it was open to you to enter guilty pleas to the charges of money laundering and participating in an organised criminal group at any stage. Resolution of any issues relating to the drugs charges did not affect that particular issue.
[33] The Crown suggests you should receive a credit of five per cent on the charges to which you entered guilty pleas. I do not accept that would be sufficient to recognise your acceptance of responsibility for these charges even though the pleas came late. I therefore propose to recognise your guilty pleas by reducing the starting point of seven years imprisonment by nine months, or just over ten per cent, to reflect your guilty pleas on those charges. This reduces the sentence on this set of charges to one of six years three months imprisonment.
Conspiracy to supply pseudoephedrine
[34] The starting point to be selected on the charge of conspiracy to supply pseudoephedrine would ordinarily be determined having regard to guideline judgments of the Court of Appeal in cases such as R v Wallace and Christie.9 Again, however, I derive the greatest assistance in this context from the starting point selected in relation to Mr Sha. Mr Sha pleaded guilty to the same charge as that on which the jury found you guilty. The Judge who sentenced him adopted a starting point of four years imprisonment.10
[35] For the reasons I have already given, I do not accept your culpability is either at the same level as that of Mr Sha or less than that of Mr Sha. I accept there was no evidence as to precisely what the relationship was between you and Mr S. What the jury’s verdict makes clear, however, is that you were prepared to purchase a large quantity of pseudoephedrine for the purpose of on-supplying it to others.
9 R v Wallace and Christie [1999] 3 NZLR 159 (CA).
10 R v Sha [2020] NZDC 10398 at [44].
[36] I consider it important that Mr S made it his business to contact you as soon as he arrived in New Zealand and then spent the remainder of his time over the next few days endeavouring to ensure that the transaction relating to the supply of pseudoephedrine was completed. In addition, this offending occurred during a period when Mr Donald Vuisevuraki was out of the country and no cash deposits were being made into Mr Simpson’s trust account. This suggests you would have had cash available to you with which to complete the purchase of the drug. In addition, and as I have already recorded, there is the involvement of Mr Clausen who was a patched Comanchero member.
[37] Viewed in that light I consider your culpability is clearly greater than that of Mr Sha because he was merely an intermediary for persons in Australia who were to supply the pseudoephedrine. He would undoubtedly have received a payment or commission for his efforts, but he was not the principal of that aspect of the transaction. For the reasons I have given, I am sure you were not acting merely an agent or intermediary. Rather, you were the person who was to purchase the drug from Mr Sha’s principals for on-supply to others. In other words, you were the principal on the purchasing side of the transaction.
[38] By any measure this was significant offending of its type. It also came close to being completed because the communications intercepted in Mr S’s vehicle demonstrate it was called off by Mr Sha’s associates shortly after Mr Clausen’s vehicle had already arrived at the scene with the cash. From your perspective the transaction was ready to be completed. I see nothing in the evidence to suggest you had withdrawn from the desire to acquire the pseudoephedrine before it was cancelled by the vendor. I consider a starting point of six years imprisonment is warranted on this charge.
Unlawful possession of ammunition
[39] The charge of being in unlawful possession of ammunition is obviously a lesser charge, although any charge relating to the unlawful possession of firearms and ammunition is serious. I adopt a starting point of four months imprisonment on that charge. Having regard to your guilty plea I reduce the sentence to one of three months imprisonment.
Summary
[40] It follows that I have selected overall starting points totalling 12 years six months imprisonment.
Aggravating factors
[41] In 2013 you sustained several convictions in Australia for assault and this resulted in you receiving several short sentences of imprisonment. Your only conviction since your arrival in New Zealand is on a charge of wilful damage. The Crown accepts your previous convictions are different in nature to the present charges and should not attract an uplift to the starting point I have selected. I therefore make no allowance for aggravating factors personal to you.
Totality
[42] The Crown urges me to impose cumulative sentences on the drugs charge and the charge of participating in an organised criminal group. Whether or not that is appropriate will depend on whether I conclude an end sentence of more than ten years imprisonment is necessary. In that event I would need to impose at least one cumulative sentence because none of the charges carries a maximum sentence of more than ten years imprisonment. If I conclude a sentence of ten years imprisonment or less is appropriate, I will impose concurrent sentences because I consider the drug offending to be closely related to the activities of the organised criminal group.
[43] Principles relating to totality need to be taken into account in fixing the final starting point, however, because, regardless of whether I impose cumulative or concurrent sentences, I cannot impose an end sentence wholly out of proportion to the overall culpability of your offending.11 I consider a sentence of 12 years six months imprisonment would have that result because, like the money laundering, your drug offending really reflects one aspect of the activities of the organised criminal group. Activities such as drug offending enabled the group to derive cash profits that it then laundered to produce assets for the enjoyment of individual members.
11 Sentencing Act 2002, s 85(2).
[44] Having regard to totality principles I consider a global starting point of 11 years imprisonment to be appropriate to reflect your overall culpability on all charges other than that of being in unlawful possession of ammunition. Taking into account totality principles I add two months for that charge. This means I reach a final starting point of 11 years two months imprisonment before taking into account mitigating factors other than guilty pleas.
Mitigating factors
[45] Your counsel has provided me with a detailed report prepared by Ms Sanjeeta Sharma, a registered clinical psychologist. This describes your background and upbringing, as well as the issues that led to your deportation from Australia and the consequences of that event.
[46] The report discloses that you are the middle child of a family of six children. Your parents were immigrants to New Zealand from the Pacific Islands and struggled to earn sufficient income to support the family whilst the family was in New Zealand. This continued after the family moved to Australia when you were just one year of age. Financial stress and hardship were a feature of family life in Australia. This was not caused by systemic deprivation from factors associated with colonisation as is so often the case with defendants coming before the Court. Rather, it reflected the fact that your parents were unskilled workers and were therefore required to undertake lower forms of employment.
[47] You suffered developmental difficulties, particularly with speech, and this led to you being bullied and feeling isolated at school. You were also teased about the fact that your skin colour was apparently darker than that of your siblings. You ultimately found that the way to deal with this was through the infliction of violence on those who bullied you. Ironically, this finally won you the approval of your father. Prior to that point your relationship with your father had been strained, and had been marked with acts of violence by your father towards you.
[48] You were expelled from school at the age of 15 years because of your use of physical violence against other students. You then undertook casual employment to help support your family because your older siblings were pursuing tertiary education.
During this period you came into contact with gangs in the Sydney area. You came into contact with the Comanchero organisation whilst you were in prison on remand in 2009. You found this group met your needs because it provided you with comradeship and brotherhood that had been lacking throughout your life to that point.
[49] You say you were surprised to be deported from Australia because your criminal history was not particularly serious, and you had only served short periods of imprisonment. Deportation to New Zealand in early 2016 obviously had dramatic consequences for you and your young family. The remainder of your family, all of whom were Australian citizens, initially remained in Australia. When you arrived in New Zealand you were therefore isolated from both your family and social networks. In addition, your previous history and the fact that you had been deported from Australia meant you found it difficult to obtain accommodation and legitimate sources of income. Not surprisingly, you began to seek the company of other persons in a similar situation to you. This ultimately led to you forming the New Zealand chapter of the Comanchero organisation and becoming its initial and only President. It also led directly to the offending for which you are now to be sentenced.
[50] The report makes it clear you are a dedicated family man. I also accept you committed the present offences in an effort to ensure your family did not suffer the same financial deprivation you and your family suffered. There are hints in the report that you are currently considering a change of lifestyle. As matters currently stand, however, I regard the prospect of any meaningful change in your lifestyle as being remote because of your entrenched involvement with those committed to the Comanchero organisation. It would take considerable willpower on your part to break away from those contacts and begin a new life.
[51] Viewed overall, I see some, albeit slim, connection between the matters identified in the report and the present offending. I find the report of somewhat greater assistance in identifying prospects of rehabilitation. I also consider some regard must be had to the extremely difficult position in which you found yourself after being deported to New Zealand. It was probably virtually inevitable that you would turn to criminal offending given your circumstances at that time. I am prepared to reduce
your sentence by 14 months, or around ten per cent, to reflect these factors. This results in an effective end sentence of ten years imprisonment.
Sentence
[52]I now impose the following sentences:
(a)On the charge of participating in an organised criminal group you are sentenced to ten years imprisonment.
(b)On each of the money laundering charges other than that relating to the sum of $575,000 used to acquire the Bucklands Beach property you are sentenced to two years imprisonment.
(c)On the charge of money laundering relating to the sum of $575,000 used to acquire the Bucklands Beach property you are sentenced to four years imprisonment.
(d)On the charge of conspiring to supply pseudoephedrine you are sentenced to six years imprisonment.
(e)On the charge of being in unlawful possession of ammunition you are sentenced to two months imprisonment.
[53] All sentences are to be served concurrently, which means you will serve an effective sentence of ten years imprisonment.
Destruction order
[54] I make an order for the destruction of the imitation pistol and ammunition found at your address.
Minimum term of imprisonment
[55] Finally, I record that the Crown has not asked me to make an order under s 86 of the Sentencing Act 2002 requiring you to serve a minimum term of imprisonment
before being eligible to apply for parole. It will be for the parole authorities to determine when you should be released.
[56]Stand down.
Addendum: Suppression
[57] During the hearing counsel advised me that Mr S is yet to stand trial for his role in the events giving rise to the charge of conspiring to supply pseudoephedrine. I record that I made an order during the hearing suppressing Mr S’s name and identifying details to protect his fair trial rights. That order is to remain in effect until disposition of the proceedings against Mr S.
Lang J