DPP v Low & Ors [2004] VSCA 250

5. The two offences represent a continuing course of criminal conspiracy between September 1993 and January 2001, although some of the respondents joined or left the conspiracy during its subsistence. The reason for the conspiracy to defraud being charged in two counts is because s.86A of the Crimes Act 1914 (Cth.) was repealed as from 15 September 1995.

8. These frauds, which, in total, deprived the revenue of some $1.3m., were able to be perpetrated by manipulation of the ATO's computerised data base. Those respondents who were employed by the ATO had access to Tax File Numbers of persons whom they knew had left the country and were no longer filing tax returns. By accessing the computer records relating to these persons by the use of relevant Tax File Numbers, they were able to change the names and details of the persons to whom such numbers had belonged, to generate credit returns, which in turn would provide for refund cheques in favour of the person whose identity had been altered. The altered details of addresses and bank accounts, to which the cheques would be sent, were controlled by the respondents. In many instances they were the addresses or banks of the non-ATO aligned respondents. The scheme, which was labelled by the appellant as "sophisticated", seems to me to have been alarmingly simple; at least in the sense that relatively low-level employees of the ATO were able to gain unmonitored and undisclosed access to the computer data base, first to alter, and then to re-set, details of Australian taxpayers.

11. The sentencing judge set out the details of this scheme at some length in her full reasons, delivered as recently as 15 October 2004. In setting out the respective roles played by the individual respondents, her Honour said:

"11. The scheme was originally devised by Low and Ting. Sayachack was later brought in by Low. Hui was brought in by Ting and Yong then brought in by Hui. Hui and Yong essentially assisted in negotiating the cheques via pick-ups from post office addresses and deposits and withdrawals in various bank accounts provided by them for which they received a percentage cut for each cheque negotiated. It has been agreed that the conspiracy was a loose scheme involving a system which became largely self-supporting and did not involve a great deal of organisation once it was up and running. 12. Each of the participants went in and out at various times. Only Mr Low was there from beginning to end. Ms Sayachack began employment with the ATO on 3 April 1987 in the Returns processing section at the Moonee Ponds ATO office. Ting joined the section in August 1989. Low began work in the same section on 19 February 1990. All three began as Level 1 clerks, primarily involved in data entry duties, but working in different teams. Sayachack and Low became friends after working together on a particular ATO project. Around September 1993 Ting agreed with Low to generate fraudulent cheques. The scheme began with Low generating five fraudulent cheques via the ATO computer system using tax file numbers held by genuine taxpayers whose names were provided by Ting. Three of the cheques were made payable to Ting's sister, brother-in-law and a friend of his, Cheri Lui. It is not known what amount of the cheque ultimately ended up in the hands of Low and Ting. 13. Ting and Low were seconded to the Department of Immigration and Ethnic Affairs, as it then was, in February 1994 where they did not have the ATO computer access they required for the scheme. At that time Ms Sayachack told Mr Low she was experiencing money difficulties and was brought by him into the scheme whilst Low and Ting were on secondment. She operated the ATO system to generate fraudulent assessments and cheques, retaining as her share between 20 and 45 per cent of the cheques proceeds. She also provided postal addresses to which many of the fraudulent refund cheques were sent. Ting continued to alter returns supported by false records, generate refund cheques and provide names and details to be used in a conspiracy including friends and family members. He also provided postal addresses for the selection of cheques and bank accounts via which they could be negotiated. He voluntarily withdrew from the scheme in 1999. 14. Around August 1995 Ting approached Hui, a friend of his for some years, offering to get him a larger tax return than he was lawfully entitled to via manipulation of the ATO computer system on the basis that Hui pay him 50 per cent of the refund obtained. Hui agreed and a falsely generated refund of about $8000 was paid out. In March 1996 Ting told Hui about the scheme operated by himself, Sayachack and Low, and asked if Hui could provide bank accounts which were needed to negotiate the bank cheques generated. Hui then provided the bank account of a friend Ms Hui Fong Yup who was about to leave Australia permanently, obtaining her bankcard and controlling the account after she left. He also gave Ting the name of his friend Cindy Yong, as a person who would also have access to accounts through which the fraudulent refund cheques could be negotiated. He further provided the name of Yup's boyfriend who had also left Australia for use in a false assessment. The Yup account was used extensively by Hui for the negotiation of fraudulent refund cheques, he retaining a percentage of the cheque and on passing the balance. 15. Cindy Yong was recruited by Hui in August 1995. She provided Hui with the names and details of friends and family who had previously lived in Australia, but who had since departed permanently leaving their bank accounts unclosed and ATM cards in her possession. Those persons included her mother and brother. She also leased a post office box to which cheques she was to deposit were sent. Yong would withdraw money from these accounts and on pay them to the co-conspirators. Cheques generated by Low, Ching and Sayachack were sent to the post office box, collected by Yong, deposited in one of the bank accounts and withdrawals made to be passed on to the co-conspirators. For this Yong received a percentage cut of each cheque."

15. Her Honour then set about summarising the actual involvement of the five respondents; the number of accesses made to the computer over the period of involvement, the total value of cheques generated by that access and the assessed personal enrichment of these respective participants. These are set out in paragraphs [16]-[20] of her Honour's reasons, as follows:

"16. Summary of involvement. (1) Mr Low. Between 10 September 93 and 4 January 2001 Low made 1517 unauthorised accesses onto the ATO computer system and in his activities in that time was associated with 225 fraudulent refund cheques totalling $1,216,248. Following the paper trail of deposits and on payments between the bank accounts controlled by the co-conspirators his known enrichment can be traced to the value of $376,849. 17. (2) Ms Sayachack. Between 16 May 1994 and 4 January 2001 Ms Sayachack made 245 unauthorised accesses to the ATO computer system which was associated with 87 fraudulent refund cheques totalling $485,417 with a known enrichment of $190,107. 18. (3) Mr Ting. Between 10 September 93 and 11 October 99 Mr Ting made 71 unauthorised accesses via the ATO computer system which were associated with 86 fraudulent refund cheques totalling $420,066. His enrichment was unable to be traced but he has told police it was in the vicinity of $80,000. 19. (4) Mr Hui. Between 21 August 1995 and 17 November 2000 Hui was associated with the negotiation of 86 refund cheques totalling $368,036 with a known enrichment of $172,223. It is conceded by the Crown that that enrichment figure relates to the monies that were remaining in his account and which may have well gone to other persons beside himself. 20. (5) Ms Yong. Between 21 August 1995 and 8 November 2000 Ms Yong was involved in the negotiation of 60 refund cheques totalling $331,669, $318,994 being deposited into accounts controlled by her. It is accepted that no assessment can be made of the amounts then retained by her, but her counsel conceded it was in the vicinity of $64,000."

19. The reasons of her Honour to which I have referred demonstrate that Low was the progenitor of this scheme, the person who remained part of it for the longest period; and the person whose enrichment as a result of it was largest (namely, $376,849 or thereabouts). In descending order of calculated enrichment derived from the scheme were the following:

* Ms Sayachack (an ATO officer who participated from May 1994 to 4 January 2001) whose known benefits were assessed at about $190,000.

* Mr Hui, who participated as a non-ATO "outsider" from August 1995 to November 2000, an estimated receiver of benefits to the value of $172,223 or thereabouts.

* Mr Ting, who participated from September 1993 to October 1999 - an estimated receiver of benefits to the value of $80,000 to $100,000 or thereabouts.

* Ms Yong, who participated as a non-ATO "outsider" from August 1995 to November 2000 - an estimated receipt of benefits in the order of $64,000.

26. It is apparent from the text of her Honour's sentencing remarks that she was well aware of the gravity of the offending by the respondents, and the level of its gravity as between them. Her Honour referred to the conspiracy as a "long term continuous plundering of the public coffers resulting in the theft of a significant amount of public money". She referred to the crimes as difficult to detect and requiring an "intricate and ... long term" investigation which her Honour assumed would have involved even more public funds. Further, she correctly identified the participation by the respondents who were officers of the ATO as a breach of trust - a trust not shared by Hui and Yong. However, in respect of all of them, her Honour recognised that just punishment of crimes of this sort required what she said was "stringent application of sentencing principles designed to deter others, to denounce such conduct and to inflict due punishment".

29. Each of these descriptions of the scheme was well warranted, as was her Honour's conclusion that Low was the principal architect and the principal beneficiary of the scheme. In the course of her sentencing remarks, her Honour also paid due regard to the fact that there was no indication in respect of four of the conspirators (namely, Low, Sayachack, Hui and Yong) that they would have discontinued their participation in the scheme if it had not been uncovered. She further noted that Mr Ting's co-operation had come at a late stage, when most of the investigative work had been completed.

32. Before pronouncing sentence, her Honour considered (as she was bound to do) the personal circumstances of the various respondents. Her remarks reveal that each of them was, at the time of sentence, aged between late 30s and mid 40s. None had any previous record of any sort; and each had circumstances which otherwise was deserving of consideration in the sentencing process. I now set out seriatim the findings which her Honour made as to the personal aspects and the personal features of each of the respondents which she incorporated in her sentencing dispositions.

36. Her Honour had evidence before her, which she accepted, that Low was significantly involved in the welfare of his two young children as a consequence of a long-standing depressive illness suffered by his former wife. Her Honour accepted that this would make incarceration (which in her Honour's view was the only appropriate form of sentence) more difficult for Low. Her Honour also accepted evidence that Low had, at relevant times, been a compulsive gambler and that most of the benefits which he received from his fraudulent behaviour had been spent to satisfy his gambling addiction. There was, in her view, no suggestion that Low had been able to live "the high life" as a result of benefits obtained. Her Honour also found that between 2001, after his crimes had been detected, and 2004 when he came before the court, he had initially declined work, believing he was about to be sentenced to gaol; but after a period of time began casual work in a restaurant to support his family and, later in 2004, had taken up employment as a cook in retirement and nursing homes. References were submitted to her Honour describing Low's work as "responsible" and there were also references to demonstrate that he had sought counselling in relation to his gambling habit, which had significantly contributed to his marriage breakdown. He had honoured variations in his bail conditions which, this year, allowed him to return to Malaysia for his father's funeral. Her Honour accepted that Low had shown remorse for his actions, that he was otherwise a person of good character, and that his actions since the scheme was detected demonstrated that he had good rehabilitation prospects. She also accepted substantial medical evidence placed before her that Low's wife depends upon his support and that both she and the children will likely suffer from his incarceration.

40. In respect of this respondent her Honour found:

* That she was one of a large Laotian family, some of whom (including her) had come to Australia in 1980 to escape the communist regime.

* She was now 40 years of age and had become an Australian citizen in 1987. She had been educated in Australia to year 11; and had then worked in various jobs until she joined the public service.

* She was married, but divorced. She has one child - a daughter, now aged five. She, too, has no criminal history.

* When discharged from the public service, she remained and subsisted for some two years on a single parent pension. Some 12 months ago she obtained work at a pharmacy; and is currently undertaking a Level 2 Pharmacy Assistance course, run by the Pharmacy Guild. Her Honour was in receipt of "impressive references" furnished by her employers, who described her as a "valuable and loyal member of the team"; a person who had their "support" as a "dependable and trustworthy worker" and who expressed themselves as prepared to continue her services when she had repaid her debt to society.

* Her Honour found - as she had with Low - that there was no material which suggested that the illicit gains received from the offending had produced any manifestations of a more indulgent lifestyle.

* Her Honour expressed concern over the effect of Sayachack's incarceration upon the young daughter.

* She was also satisfied that the lengthy period between apprehension and sentence had, in her case, demonstrated strong rehabilitative prospects.

* He was now 40; and had come to Australia from Vietnam in the 1980's, sponsored by his sister. He engaged in factory work whilst attending night school at Footscray Technical College. In 1989 he joined the ATO, where he worked until 1996. Whilst there he obtained a Bachelor of Accountancy from RMIT. He married in 1996 and has two sons, born in 1999 and 2001.

* Her Honour found that, of the five conspirators, he was the only one to voluntarily withdraw before the discovery by the authorities of the fraudulent scheme in 2001. This "locus poenitentiae" occurred in 1999 after the birth of his first child. He was also the only one to respond to the request by police for an interview. He gave his answers, as her Honour found, at length and candidly.

* The prosecution was unable to assess an "enrichment figure" for Ting; but he estimated his benefits to be between $50,000 and $84,000. Her Honour was prepared to accept that the benefits which Ting obtained were between $80,000 to $100,000. Her Honour found that he had invested those moneys in a business of exporting Australian goods to Vietnam; but that the business had failed.

* Her Honour accepted evidence on behalf of Ting that he was remorseful, and that his conviction and sentence would inevitably render his accountancy qualification of no use to him.

60. Her Honour found in relation to this respondent:

* That she was aged 42 and migrated to Australia from Malaysia in 1986. She lives here with her husband and children. Until the birth of her second child she had worked in various factories and restaurants, but that since 1995 she had been a full-time mother and carer.

* Her Honour had before her significant evidence that the younger child, Kevin, had significant hearing problems which have caused learning and developmental problems which make him very dependent upon his mother. Mr Croucher has tendered a solicitor's affidavit to the Court exhibiting a report from the child's psychologist supporting the difficulties being experienced by the child in the absence of his mother.

* Her Honour also had before her psychiatric evidence suggesting a lack of learning, anger and impulse control in the elder boy, and his dependence also on his mother.

* Her Honour found in this respondent's case that she and her husband have very little income between them. Indeed, her Honour found that it was likely that Ms Yong had contributed whatever benefits she gained towards payment for their modest home.

* Her Honour also found that Ms Yong had no prior or subsequent criminal history; that she had a "lesser" role in the offending; and that she, too, had strong rehabilitative prospects.

69. In respect of this respondent, her Honour found:

* That he was 38 years of age and had come to Australia in 1986. He has no previous or subsequent history of criminal offending; and that some of the illicit gains which he received were spent on herbal treatment for his mother's cancer.

* That he had been an industrious worker in various jobs until about 2002, when he was made redundant. Since then, he has worked with his wife, whom he married in 1997, as "outworkers" in the "sewing industry".

* They have two children, aged 6 and 4. The wife is dependent upon the respondent, and has developed serious levels of depression and anxiety which will not be assisted by incarceration of her husband.

75. In accordance with these findings, which, as I say, came from an extensive review of the material before her, her Honour - in the exercise of her discretion, and no doubt based on her instinctive synthesising of that material - imposed sentences on the five respondents as follows:

* Low (who, as I have said, her Honour regarded as the "architect" of the scheme; and responsible for "recruiting" Sayachack):

Count 2: : 2 years to commence on the completion of the sentence on count 1 -

rendering a total effective sentence of 4 years; but her Honour ordering that Low be released on a Recognisance Release Order ("RRO") in the sum of $2,000 (s.19AB Crimes Act) after serving 18 months of the sentence; the RRO to be of 2 years and 6 months duration.

Count 2 : 18 months to commence at expiry of the sentence on count 1.

The total effective sentence was, therefore, 3 years. Her Honour then ordered, having regard to "matters personal" to this respondent, and in particular to the position of her daughter, that she should be released on an RRO ($1,500) of 2 years and 3 months duration, after she had served 9 months of the sentence imposed.

* Ting, whom, her Honour regarded as one of the scheme's architects, although less active than Low and Sayachack. She nevertheless regarded him as a significant "player" in the team, but entitled to a "significant discount" for his voluntary desisting from participation in 1999. Her Honour's sentence upon him was:

Count 2 : 1 year imprisonment to commence upon expiry of count 1.

The total effective sentence was therefore 3 years. Her Honour ordered Ting to serve 12 months of the sentence before being released on an RRO ($2,000) of 2 years duration.

* Hui, whom her Honour described as being "extensively involved in collection and registration of fraudulent refund cheques":

Count 2 : 14 months to commence at expiry of sentence on count 1.

The total effective sentence was therefore 2 years. Her Honour ordered Hui to serve 10 months before being released on an RRO of 14 months duration.

* Yong, whom her Honour found to be the "lesser offender" than all others. She also specifically took into account the particular difficulties with respect to each of the two children:

Count 2 : 10 months to commence at the expiry of count 1.

Total effective sentence of 18 months, to be released on an RRO (duration of 15 months) after serving 3 months in gaol.

* Each respondent was made the subject of an order for restitution of the $1.307 million which had been misappropriated.

99. The Director's notices of appeal challenge the sentences imposed on each respondent. In the case of each respondent, the grounds of appeal were essentially the same; grounds 1 and 2 asserting that the sentences imposed on counts 1 and 2 were manifestly inadequate; both as to the actual sentences imposed and the time to be served before release. The remainder of the grounds, as it seems to me, amount to particulars of grounds 1 and 2; asserting as they do that her Honour failed to give sufficient weight, or gave undue weight, to various matters to be taken into account in the exercise of her discretion.

102. In advancing his submissions to this Court, the Director conceded that grounds 1 and 2 were, in essence, the effective grounds of appeal; namely, that the head sentences and periods to be served before being eligible for release were, in the case of each respondent, manifestly inadequate. The remainder of the grounds were, he agreed, particulars of the grounds alleging manifest inadequacy. He submitted that, at the relevant time, the offence carried a maximum penalty of 20 years (although presently it is 10 years; see s.135.4 Criminal Code (Cth.) which may, by virtue of s.4F(2) of the Crimes Act (Cth.), be the relevant maximum); and that her Honour's sentences do not reflect the gravity of the conduct of the respondents, and particularly those employed by the ATO, who were involved in breaches of their employer's trust in manipulating the national data base and compromising its records. This was, he submitted, a conspiracy involving a substantial fraud upon the revenue, sustained over many years and involving multiple transactions. Thus, the Director contended that the sentences imposed were disproportionately low and failed to reflect the seriousness of the offending. Indeed, they were sentences, he submitted, which are out of step with sentences usually imposed throughout Australia for revenue frauds, particularly where those frauds involve a breach of trust.

105. The Director further submitted, in essence, that the sentences which the learned judge imposed did not meet the rhetoric contained in paragraph [60] of her reasons for sentence, where she had said that the respondents had all been involved directly in a scheme which:

" ... targeted the principal source of community revenue and funding in this country, underpinning the vast structure of government facility and service in Australia. Protection of it from this sort of exploitation requires the most stringent application of sentencing principles designed to deter others, to denounce such conduct and to inflict due punishment."

In short, it was put by the Director that in fixing both head sentences and pre-release periods the sentencing judge had undervalued the aggravated nature of the offending. Such sentences, so he submitted, sent no "signal of deterrence" to like-minded members of the community because, by importing all the "subjective elements" into the sentences, she had overridden her stated intention to impose sentences with a deterrent effect.

110. In response to the Director's submissions, counsel for each of the respondents made common cause, in submitting that there was no basis upon which this Court could or should conclude, on a Director's appeal of this nature, that the sentences which her Honour had imposed were manifestly inadequate. Counsel, or at least some of them, were prepared to concede that the sentences - or some of them - were at the "low end of the range"; but that was because of the obvious mitigating circumstances which her Honour, correctly, had taken into account. It was obvious, so it was submitted, that there were differences in culpability between each of the respondents, and the sentences imposed reflected the "pattern" of the differing culpability. At the end of the day, I think it is fair to say, without doing them an injustice, that counsel for each respondent contended that the sentences imposed on the respective respondents could not be described as "manifestly inadequate"; and that, even if the Court were to regard one or more of them as such, it should exercise the discretion which it undoubtedly has on a Crown appeal not to intervene.[1] The principles of general deterrence, so counsel submitted, were satisfied by imposing prison sentences actually to be served by those who had been otherwise of good character. In particular, in defending the sentences imposed on their respective clients, counsel laid emphasis on the delay between apprehension and sentence, nearly 3½ years, and the significance in this case of the guilty pleas. The delay, albeit due in part to the failure of the respondents to engage in interviews with the police, resulted in these matters "hanging over the heads" of the respondents for a number of years; but - and perhaps more significantly - enabled her Honour to conclude that the rehabilitation of each of them was well established by the time of sentence.

113. Although I am of the opinion that the sentences imposed by her Honour are at the low end of the range, to the point of being merciful, I am, nevertheless, not prepared to interfere with them. Her Honour's sentencing reasons outlined in full detail why she was imposing the sentences which she did, and no specific error has been identified in her reasons in this Court. What the Director says is that this Court should conclude that the sentences actually imposed bespeak error because they are manifestly inadequate. In my view an allegation of "manifest inadequacy", although frequently made, has its limitations in a Crown appeal simply because it attacks the exercise of the discretion of the trial judge and thus invokes - or should invoke - the appellate court's caution before substituting its own discretion for that of the trial judge.[2] It was not suggested here that, in exercising her discretion, the judge had acted upon any wrong principle, or had allowed irrelevant and extraneous matters to enter upon her consideration, or had mistaken the facts. In those circumstances - in the ordinary appeal against the exercise of a judge's discretion - an appellate court could only interfere if it came to the view that the discretionary exercise, upon the facts, was "unreasonable or plainly unjust".[3] Those principles relating to appellate interference with discretionary judgments have been recently re-stated in this Court in R. v. Langdon[4] in the judgment of Gillard, A.J.A. These principles necessarily apply when appellate courts are called upon to interfere with a judge's sentence on the grounds that it is "manifestly excessive" or "manifestly inadequate". However, when it is the Crown which is alleging that a sentence is manifestly inadequate, the principles to which I have already referred are overlaid by further principles of restraint. Those principles are well known, and collected in the judgment of Charles, J.A. in R. v. Clarke[5]. It is perhaps necessary only to refer, in addition, to the oft repeated statement made by King, C.J. in R. v. Osenkowski[6]:

"[P]rosecution appeals should not be allowed to circumscribe unduly the sentencing discretion of judges. There must always be a place for the exercise of mercy where the judge's sympathies are reasonably excited by the circumstances of the case. There must always be a place for the leniency which has traditionally been extended, even to offenders with bad records, when the judge forms the view, almost intuitively in the case of experienced judges, that leniency at that particular stage of an offender's life might lead to reform."

A fortiori where - as here - the respondents have no criminal history at all.

118. It necessarily follows from the foregoing that an appellate court, upon appeals such as these, will be unwilling to interfere with sentences on the sole ground of manifest inadequacy unless it is clearly satisfied that the sentences imposed by the trial judge are plainly erroneous or unreasonable. I am not satisfied that the sentences which this judge imposed meet that description. The offending of the respondents was serious and sustained, to be sure, involving as it did a breach of trust, at least on the part of those who were employed by the ATO. However, as her Honour pointed out, each of the respondents was entitled to significant discounts for pleas of guilty, which, apart from demonstrating remorse, had significant utilitarian value in this case, where the trial would have consumed many months.[7] Furthermore, she was entitled to conclude, as she did, that the lengthy delay between apprehension and plea had enabled, at least, the court to be satisfied that the rehabilitation of each respondent was well established. Although, in particular, the pre-release sentences which her Honour set were at the low end of the range, they could not be said, in the circumstances which she so carefully described, to amount to an unreasonable exercise of her discretion. Although comparison with other sentences imposed in other circumstances is undesirable, and generally unhelpful, there have been cases of frauds against the Commonwealth, of similar magnitude to these, where the Court has refused to intervene on a Crown appeal, where the sentence imposed has been non-custodial.[8]

121. Indeed, as Mr Priest pointed out in the course of argument, the prosecutor who appeared before her Honour had provided "for guidance" a copy of a District Court (NSW) judge's reasons for sentence in a case where the facts had a marked similarity to those which confronted her Honour. Her Honour was invited to use it for guidance as to "the attitude that brother judges in other States are taking in cases of this sort". Although, as I have said, it is unhelpful for a judge exercising a sentencing discretion on the facts of a particular case to be referred to discretions exercised in other cases, on other facts, it has been the practice in matters involving Commonwealth offences for the Director to provide assistance to State judges in the form of recent decisions in similar matters in other parts of the Commonwealth. This is done not for the purpose of "binding the hands" of the sentencing judges, but to give the judges a "feel" of what is happening in "like cases" around the country. I have no doubt that that was the reason why the prosecutor deemed it appropriate to provide the reasons of the District Court judge in this particular case[9] to her Honour - and I have no doubt that her Honour used it for the purpose intended. The case involved a long-running fraud on the ATO by a supervisor which deprived the Tax Office of over $1m. in six years. Again the fraud involved the generation of false returns leading to false refunds. The personal circumstances of the offender, and his assistants, led to the application of differing sentencing principles from those which faced her Honour in this case; but, as Mr Priest pointed out, the ultimate sentence imposed was a head sentence of 4 years; 3½ of which were imposed for the count of defrauding the Commonwealth. It was Mr Priest's point, in referring to this matter, that, if guidance was intended, it pointed towards the type of head sentences which her Honour had imposed in this case.

124. 23 The fact that members of this Court might have exercised the sentencing discretion differently from the way in which her Honour exercised it is of no consequence, unless it is clear that her Honour's discretion has been exercised unreasonably and unsoundly. For my own part, I am not prepared to conclude that it has been in the case of any of the respondents. In an era in which Crown appeals are becoming increasingly common, it is perhaps appropriate to refer to what was recently said by Eames, J.A. in the recent Crown appeal in the matter of Leach[10]:

" ... the fact that Director's appeals are now quite common should not detract from the continuing application of the principle that it is only in very clear and rare cases of manifest inadequacy or error that a Director's appeal should be allowed. It is particularly important that this Court should not devalue or deny the right of a sentencing judge to act mercifully in a case where it seems to the judge to be an instance where an opportunity for reformation of a prisoner might be grasped. That, after all, might be a decision which redounds very much to the benefit of the community."

It is the trial judge who is invested with the primary obligation to sentence prisoners. The exercise of his or her sentencing discretion should not be unduly circumscribed by an appellate court, particularly where the appellate court is being asked by the Crown to sentence the prisoner for a second time.

129. It follows from what I have said that it is my view that each of the appeals should be dismissed.

133. The offences in each case involved a very high degree of culpability, and the wholesale manipulation of a national Commonwealth database and a compromising of the taxation records therein. The first three respondents were in breach of trust by virtue of their employment in the Commonwealth taxation service. All five respondents participated in a conspiracy to defraud the revenue, and the conspiracy was maintained over seven years and employed sophisticated methodology.

136. I accept the submission of the Director of Public Prosecutions that those who systematically defraud the revenue of a large sum of money over a long period must in general expect a substantial custodial sentence, and that the deterrent and punitive effects of that sentence should not be diminished by allowing release from custody at an unduly early stage.

139. 27 On the other hand there were significant mitigating factors to be taken into account in respect of each respondent. First, all pleaded guilty. Notwithstanding the strength of the prosecution case, a full trial would have been very lengthy, probably not less than 12 months in duration. The cost to the Commonwealth of conducting such a trial would have been hundreds of thousands of dollars. The plea of guilty made such a trial unnecessary and entitled the respondents each to a substantial discount. As McKechnie, J. said in Salaminah Radebe[11] -

"Where an offender is caught red-handed, it is tempting to make little reduction for a subsequent plea of guilty even if made at the first available opportunity. Nevertheless, the matters of high policy essential for the effective operation of the criminal justice system demand a substantial reduction."

Unless accused persons can be shown that such discounts are actually given where a plea of guilty is entered (or co-operation with prosecuting authorities is offered and takes place), they will obviously be less likely to plead guilty or to co-operate.[12]

144. Furthermore, a very long delay had occurred between the detection of the offences (August 2000), committal for trial (April 2004) and sentencing (October 2004). That delay is doubtless explained largely by the difficult investigatory process faced by the prosecutors. But it also left each respondent waiting in suspense for a period of four years before sentence was imposed, and in which substantial evidence of remorse and rehabilitation became available.

147. There were other mitigatory factors available for the consideration of the judge in the case of each respondent. They have been referred to in detail in the reasons of the President.

150. The judge was faced with a very complex sentencing exercise. Her Honour's reasons were, with respect, very thorough and carefully planned. It cannot, I think, be said that her Honour failed to take into account any of the considerations urged upon us by the Director of Public Prosecutions. His real complaint is that the sentences, particularly the non-parole periods, are all manifestly inadequate. For my part, I would accept - indeed some of the submissions filed on behalf of the respondents also accept - that the sentences are very merciful indeed. They are all, at least, at the very lowest point of the relevant range. I would myself, if first sentencing the respondents, unquestionably have imposed higher sentences. But that is not the relevant test in determining whether this appeal should succeed.

153. As Eames, J.A. said in DPP v. Leach,[13] "It is only in very clear and rare cases of manifest inadequacy or error that a Director's appeal should be allowed. It is particularly important that this Court should not devalue or deny the right of a sentencing judge to act mercifully ..."; and, of course, if this Court were inclined to intervene, it is well established that a sentence somewhat less than that which should otherwise have been imposed will be ordered.

156. 32 Taking all these matters into account and after considerable hesitation, I agree with the President that the appeal should be dismissed, and, subject to what I have said, for the reasons his Honour has given.

160. I regret that I am unable to reach the same conclusion as the other members of this Court as to the disposition of this appeal, and in the circumstances it is only necessary for me to state my reasons for dissent shortly. I should say at the outset that I accept what the learned President said in his reasons as to the principles applicable to Crown appeals. Next, like the other members of the Court, I consider that the offending here was of a very serious nature. The offence to which the respondents pleaded guilty was a very serious one, as the maximum custodial period prescribed by Parliament makes clear. The offending conduct resulted in the Commonwealth - and therefore the public - being defrauded on a large scale over a very long period, the loss amounting to over $1.3 million. The fraud continued until the investigation in relation to it commenced. It was organised and executed with considerable skill and with the view to maximising the financial return to the fraudsters, yet minimising the risk of the theft being uncovered either by the ATO or by the banks through which the ill-gotten gains were effectively "laundered". It is plain enough that, to the detriment of the public, the fraudulent enterprise was very successful. One of its features was that it was very difficult to detect and, as I understand it, it was effectively stumbled upon when investigations were carried out arising out of the collection of the Goods and Services Tax.

163. It is plain enough that the culpability for the fraud rested essentially with the three ATO fraudsters whose criminal conduct involved sustained, gross and cynical breaches of trust. The principal offender could be said to be Low. But those who participated in the fraud from outside the ATO environment were also an integral part of the criminal enterprise. Their conduct necessarily involved deceit of the banks and perpetration of fraud on the revenue. It is they who made it possible for the ill-gotten cheques to be processed so that they, and the other respondents, could take the benefit of the fraudulent conduct by the ATO offenders with a minimum risk of detection. Without their active assistance and participation in the fraud it could not have been as successful as it was. The funds so taken by the respondents were spent by them on their personal pursuits.

166. In the circumstances, I consider that the sentencing principles of general deterrence, condemnation by the court of such conduct and the imposition of sentences that justly reflect the criminality of the conduct, were of paramount importance.

169. I recognise that against those aggravating factors there are considerable mitigating circumstances. But not all of those factors are as compelling as might first appear. Thus, although the period of delay between the time when the respondents were charged and when they were committed was significant, this was due largely to the size and extent of the investigation that had to be undertaken to establish the respondents' fraud. This investigation had to be carried out without any assistance from the respondents. Similarly, the plea of guilty, which warrants a considerable sentencing discount, was made in circumstances where the prosecution case was, on its face, at least very formidable, although it did facilitate the course of justice, thereby warranting a material sentencing discount. That the respondents were of prior good character is, I think, not a very relevant consideration in the sentencing process in a case such as this. But there are other mitigating circumstances, to which the learned President referred in his reasons, which are of considerable importance for sentencing purposes, such as expressions of remorse, the personal circumstances of the respondents and their respective families, the fact that Ting left the fraudulent scheme of his own volition and, importantly, I think, the significant rehabilitation that has been achieved by each of the respondents.

172. 37 I recognise that the task of the sentencing judge in this case was a very difficult one and that her Honour analysed the circumstances and principles applicable to the sentencing disposition with great care and clarity. Moreover, as I have said, I am conscious of the constraints imposed on this Court in determining appeals by the Director, which were highlighted by Winneke, P. in his reasons for judgment. I also acknowledge that the discretion of the sentencing judge to extend mercy or leniency is a very wide one. Nevertheless, I consider that the impugned sentences, particularly the pre-release periods ordered, reveal such inconsistency in sentencing standards as to constitute plain error in principle. In case of doubt, I make it clear that I am not influenced in coming to my ultimate conclusion by the range of sentences, imposed in other cases, that were presented to the Court by the Director. In fairness to the Director it should be said that he did not put those sentences forward as some sort of yardstick or tariff. Nevertheless, for reasons stated by others, I do not find them helpful for the purpose of resolving this appeal. Importantly, I think, the impugned sentences and, in particular, the pre-release periods ordered, plainly fail to reflect the gravity of the offending conduct and, in my respectful view, they undervalue, to an unacceptable extent, the operation of the sentencing principles to which I have referred, particularly general deterrence.

175. In the circumstances, I would have allowed the appeals and re-sentenced the respondents to significantly higher sentences, but taking into account the operation of the principle of double jeopardy. I should say that, given the circumstances applicable to the respondents, which their counsel helpfully highlighted to the Court, I would have ordered, on re-sentencing, pre-release periods of lesser duration than two-thirds of any head sentence that I might have ordered.

179. The formal order of the Court, by a majority, is that each of the appeals by the Director is dismissed.

[1] Cf. DPP (Cth.) v. Alateras [2004] VSCA 214 per Nettle, J.A. at [33].

[2] Cf. R. v. Bernath, unreported, Court of Appeal, 23 May 1996, per Callaway, J.A. at p.13.

[3] House v. The King [1936] HCA 40; (1936) 55 C.L.R. 499 at 505 per Dixon, Evatt and McTiernan, JJ.

[4] [2004] VSCA 205 at paras [69] ff. per Gillard, A.J.A.

[5] [1996] VICSC 30; [1996] 2 V.R. 520 at 522.

[6] (1982) 30 S.A.S.R. 212 at 212-3.

[7] Cf. R. v. Duncan [1998] 3 V.R. 208 at 215.

[8] Cf. DPP (Cth.) v. Trainor & Cahir [2000] VSCA 249.

[11] [2001] WASCA 254; (2001) 122 A.Crim.R. 559 at [27].

[12] See also R. v. Duncan [1998] 3 V.R. 208 per Callaway, J.A. at 215.

[13] [2003] VSCA 96; (2003) 139 A.Crim.R. 64 at [48].