Huang v R

Court of Criminal Appeal (NSW)|2017-07-24|Before: Bathurst CJ, Beazley P, Hoeben CJ, McCallum J, Bellew J

Solicitors: Bilias & Associates (Appellant) Office of the Commonwealth Director of Public Prosecutions (Respondent) File Number(s): 2013/00258327 Decision under appeal Court or tribunal: District Court Date of Decision: 09 December 2015 Before: Conlon DCJ File Number(s): 2013/248327

[This headnote is not to be read as part of the judgment] During the period from 21 March to 7 May 2013, Jun Yu Huang (the appellant) converted AUD$3,216,500 into either Chinese Yuan Renminbi or Hong Kong Dollars at several money remitters in Sydney using false identities. The appellant then transferred that amount out of Australia to accounts in China or Hong Kong using the same false identities. In relation to six transfers that totalled AUD$1,349,000, the appellant was charged with committing the offence of dealing in proceeds of crime, contrary to the Criminal Code (Cth), s 400.3(1). The appellant pleaded guilty to the charge on the date the matter was set down for trial, and was sentenced to a term of imprisonment of 8 years, with a non-parole period of 5 years. Nine further offences involving transactions totalling AUD$1,867,500 were taken into account on sentence pursuant to the Crimes Act 1914 (Cth), s 16BA (the s 16BA offences). Four of those offences involved knowingly producing a driver licence in a false name, contrary to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth), s 137(1). The remaining five offences involved commencing to receive a designated service using a false customer name, contrary to the Anti-Money Laundering and Counter-Terrorism Financing Act, s 140(1). In his remarks on sentence, the sentencing judge said that, in respect of these transfers, the appellant had transferred the monies "using the same method and with the same intention" as in respect of the offence to which he pleaded guilty. The issues on appeal were:

Whether the sentencing judge erred in his consideration of the s 16BA offences (Ground 1);
Whether the sentencing judge erred in declining to allow a discount for the utilitarian value of the appellant's guilty plea (Ground 2); and
Whether the sentence imposed was manifestly excessive (Ground 3). The Court granted leave to appeal from sentence and allowed the appeal.

Ground 1 Beazley P (Bathurst CJ, Hoeben CJ at CL, McCallum and Bellew JJ agreeing) held: (i) The principle that a person should not be punished for an offence in respect of which they have not been convicted only applies where a person is in fact sentenced for conduct constituting an uncharged offence or aggravating circumstance: [8], [54], [98]. R v De Simoni (1981) 147 CLR 383; [1981] HCA 31; Nguyen v R (2016) 256 CLR 656; [2016] HCA 17, considered. Bathurst CJ held: (ii) In considering the gravity of the s 16BA offences, the sentencing judge did not err in taking into account the amount of funds transferred. Although the relevant intention for the offence with which the appellant was charged is not an element of the s 16BA offences, the sentencing judge did not import that element of intention in taking into account the s 16BA offences: [9]-[11]. Beazley P (Hoeben CJ at CL and Bellew J agreeing) held: (iii) The sentencing judge did not err in his consideration of the s 16BA offences, and in stating that the appellant, "using the same method and with the same intention" as the offence with which he was charged, conducted the transfers the subject of the s 16BA offences. The nature and seriousness of the s 16BA offences is relevant to determining an appropriate sentence for the offence with which the appellant was charged: [52]-[56]. Re Attorney-General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1990 No 1 of 2002 (2002) 56 NSWLR 146; [2002] NSWCCA 518, considered. McCallum J held: (iv) The sentencing judge erred in his consideration of the s 16BA offences, in having regard to an element of intention that is not an element of the s 16BA offences in his assessment of the objective seriousness of those offences: [95]-[98].

Ground 2 Beazley P (Bathurst CJ, Hoeben CJ at CL, McCallum and Bellew JJ agreeing) held: (v) The utilitarian value of a guilty plea is a relevant consideration in sentencing for a Commonwealth offence: [15], [99]. Xiao v R [2018] NSWCCA 4, followed. (vi) The sentencing judge erred in declining to allow a discount for the utilitarian value of the appellant's guilty plea. However, as the appellant's plea was entered on the date the matter was set down for trial, the appellant was only entitled to a 10 per cent discount: [16], [81]-[86], [100], [103]. R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309; Hili v R; Jones v R (2010) 242 CLR 520; [2010] HCA 45; Hart v Attorney-General for New South Wales [2016] NSWCCA 71; Zhao v R [2016] NSWCCA 179; Nash v Silver City Drilling (NSW) Pty Ltd; Attorney-General for New South Wales v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96, considered.

Ground 3 Beazley P (Bathurst CJ, Hoeben CJ at CL, McCallum and Bellew JJ agreeing) held: (vii) Had it been necessary to decide this ground, the Court would have found that the sentence imposed was not manifestly excessive, having regard to all of the circumstances, including the objective seriousness of the offence, the appellant's subjective circumstances, his prospects of rehabilitation and the importance of general deterrence: [76]-[80], [87]-[89], [101]-[103]. Director of Public Prosecutions (Cth) v De La Rosa (2010) 79 NSWLR 1; [2010] NSWCCA 194; Hili v R; Jones v R (2010) 242 CLR 520; [2010] HCA 45; Kentwell v R (2014) 252 CLR 601; [2014] HCA 37, referred to. R v Huang; R v Siu (2007) 174 A Crim R 370; [2007] NSWCCA 259; Director of Public Prosecutions v Lai [2013] VCC 1318; Islam v R [2016] NSWCCA 233, considered.

Judgment

BATHURST CJ: I have had the advantage of reading the judgments of Beazley P and McCallum J in draft. I agree with the orders proposed by Beazley P and, subject to what I have written below in relation to ground 1, with her Honour's reasons.
The sentencing judge, early in his judgment, was careful to distinguish between the offence which was the subject of the indictment and those offences listed on the "Form for the Purpose of s 16BA" of the Crimes Act 1914 (Cth) (the s 16BA offences). He described the s 16BA offences by reference to Annexure B to the Agreed Statement of Facts, which, in turn, described them by reference to particular transfers involved with each offence.
In dealing with the objective seriousness of the offence which was the subject of the indictment, the sentencing judge made the following remarks: "The facts that I have set out in detail indicate that during a period of about one and a half months, that is from 21 March 2013 to 6 May 2013 the offender conducted a total of six foreign currency transactions using false names and assumed identities (William Cai and Jason); that he used the identities of others without their knowledge and consent; that he prevailed on others to assist in the commission of some of the transactions by requesting that they make large cash deposits into banks on his behalf; that the money involved over this period totalled $1,349,000. I am satisfied that the offending conduct was a product of forethought and planning and he had developed a system. He was clearly motivated by financial gain. The [s 16BA offences] occurred over the same period, that is 21 March 2013 until 6 May 2013. There were four offences under s 137 of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (the AML Act) and a further five offences under s 140 of that Act. The offender employed the same system and those transfers totalled $1,867,500."
Once again, the sentencing judge distinguished the two groups of offences. The sentencing judge then stated that the focus of any assessment of the objective seriousness of the offending conduct would be on "what 'the offender did'". The sentencing judge then stated that the "nature and scope of the enterprise involving many transactions and large amounts of cash highlight the very serious nature of the offending conduct".
It is not clear whether, in making those remarks, the sentencing judge was referring only to the offence which was the subject of the indictment or was also including the s 16BA offences. However, his ultimate conclusion, in my view, makes it clear that, irrespective of the s 16BA offences, he regarded the "objective criminality" of the offence which was the subject of the indictment as "high", taking into account the amount of money involved ($1,349,000) and the fact that the transfers were done "in such a way as to conceal the true identity of the transfer [sic, transferor]" and to "avoid accurate reporting of those transfers and the ability to trace the source of funds".
It is only after reaching that conclusion that the sentencing judge made the comment of which complaint is made. The comment was as follows: "Similarly, in respect of the [s 16BA offences], using the same method and with the same intention he transferred $1,867,500 out of Australia into accounts in China."
There are two matters which may be said about that remark. The first is that, although the offence for which the applicant was charged, namely a contravention of s 400.3(1) of the Criminal Code (Cth), was more serious than the s 16BA offences, namely, contraventions of s 137(1) and s 140(1) of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth), the applicant was not being punished for the latter offences. That is made clear by what was said by Spigelman CJ in Attorney General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 (2002) 56 NSWLR 146. The Chief Justice made the following remarks at [42]: "[42] The position, in my opinion, is that, although a court is sentencing for a particular offence, it takes into account the matters for which guilt has been admitted, with a view to increasing the penalty that would otherwise be appropriate for the particular offence. The court does so by giving greater weight to two elements which are always material in the sentencing process. The first is the need for personal deterrence, which the commission of the other offences will frequently indicate, ought to be given greater weight by reason of the course of conduct in which the accused has engaged. The second is the community's entitlement to extract retribution for serious offences when there are other offences for which no punishment has in fact been imposed. These elements are entitled to greater weight than they may otherwise be given when sentencing for the primary offence. There are matters which limit the extent to which this is so. The express provision in s 33(3) referring to the maximum penalty for the primary offence is one. The principle of totality is another."
It was not suggested in the present case that the sentencing judge misunderstood this principle and sentenced the offender for the s 16BA offences. It follows that there is no room for the operation of the principle that a sentencing judge should not take into account matters which would lead to the offender being punished for an offence more serious than that for which the offender has been convicted as aggravating circumstances of an offence: R v De Simoni (1981) 147 CLR 383 at 389.
The second matter is this. In considering the s 16BA offences, it does not seem to me to be erroneous to take into account the amount of funds transferred as a result. That seems to me to be a relevant factor in considering the gravity of the s 16BA offences for the purpose of taking them into account in determining the appropriate sentence for the offence which was the subject of the indictment.
There is more difficulty with his Honour's reference to "the same intention". The relevant intention for the offence under s 400.3(1) of the Criminal Code is the intention that the "money or other property will become an instrument of crime". This intention is not an element of the s 16BA offences and thus could not be said to be something encompassed in the admission by the applicant that he had committed those offences. In those circumstances, in my opinion, it would be erroneous to take that fact into account in considering whether and to what extent the penalty for the offence which was the subject of the indictment should be increased by virtue of the s 16BA offences.
However, albeit with some hesitation, I agree with Beazley P that, looking at the judgment as a whole, the sentencing judge was not importing that element of intention in taking the s 16BA offences into account, but rather, was explaining the modus operandi of these offences. I am fortified in that view by the fact that it is necessary to resentence the applicant in any event. In that context, I agree with the sentence proposed by Beazley P. My view as to the appropriate sentence would not have been affected had I found that the sentencing judge made the error complained of in ground 1.
BEAZLEY P: On 30 March 2015, the appellant pleaded guilty to one charge of dealing in proceeds of crime contrary to the Criminal Code (Cth), s 400.3(1). The plea was entered on the date the matter was set down for trial. On 9 December 2015, the appellant was sentenced to 8 years imprisonment to expire on 8 December 2023 and to a non-parole period of 5 years to expire on 8 December 2020, upon which date he will become eligible for parole. The offence carries a maximum penalty of 25 years imprisonment.
Pursuant to the Crimes Act 1914 (Cth), s 16BA, the sentencing judge took into account nine additional offences under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (the s 16BA offences). Four of those offences involved knowingly producing a driver licence in a false name contrary to s 137(1) of that Act. The maximum sentence for an offence under s 137(1) is 10 years imprisonment. The remaining five offences involved commencing to receive a designated service using a false customer name, contrary to s 140(1) of the Act. The maximum sentence under s 140(1) is 2 years imprisonment.
The appellant seeks leave to appeal from sentence on the following grounds: (1) The sentencing judge erred when taking into account the s 16BA offences, by having regard to facts which were beyond the offences taken into account and which would have sustained a charge for a more serious offence. (2) The sentencing judge erred in the approach taken to the appellant's plea of guilty. (3) The sentence is, in all the circumstances, manifestly excessive.
The appeal in this matter was heard at the same time as Xiao v R [2018] NSWCCA 4, in which the question whether, under the Commonwealth sentencing regime, the utilitarian benefit of a plea of guilty is a relevant sentencing consideration was also in issue. This Court in Xiao held, at [278], that the utilitarian value of a plea is a relevant consideration in sentencing for a Commonwealth offence. The Court noted that the cases which have held to the contrary should not be followed. The Court further stated that, in the interests of transparency, any discount that is applied to a sentence should be specified.
As the sentencing judge in the present matter did not take into account the utilitarian value of the plea, leave to appeal should be granted and the appeal allowed on ground 2. It follows that the appellant is to be resentenced. For that reason, it is strictly not necessary to consider grounds 1 and 3 of the notice of appeal. However, there are two aspects of the appellant's argument that remain relevant to the resentencing exercise, including whether any other sentence is warranted in law.
The first is the complaint that the sentencing judge, in stating that the appellant transferred AUD$3,216,500 out of Australia to accounts in China or Hong Kong, wrongly combined the amounts involved in both the offence on the indictment and the amounts involved in the s 16BA offences. The second is the complaint encompassed in ground 1 of the notice of appeal, that the sentencing judge, when taking into account the s 16BA offences, impermissibly had regard to facts that would have sustained a more serious charge. I have also reviewed the cases upon which the parties relied in respect of ground 3.

The facts

The following recitation of the facts is taken from the statement of facts tendered at the sentencing hearing.
During the period from 21 March to 7 May 2013, the appellant converted a total amount of AUD$3,216,500 into either Chinese Yuan Renminbi or Hong Kong Dollars at various money remitting agents in Sydney using false identities. The appellant then transferred that amount out of Australia to accounts in China or Hong Kong using the same false identities. As already mentioned, this amount was the total amount transferred in relation to the offence on the indictment and the s 16BA offences.
The appellant used the false identities at the following money remitters: (a) Superforex Financial Pty Limited (Superforex); (b) Xingying Pty Limited, trading as Anying (Anying); (c) DS Finance Group Pty Limited (DS Finance); (d) New Century 2001 Pty Limited, trading as Supay (Supay); (e) Ocean Pass Finance Pty Limited (Ocean Pass); and (f) Fast Exchange Pty Limited (Fast Exchange).
The transfers conducted at Superforex and Fast Exchange were the subject of the count on the indictment. Those transfers totalled AUD$1,349,000.
The transfers conducted at Anying, DS Finance, Supay and Ocean Pass were the subject of the s 16BA offences. These transfers totalled AUD$1,867,500.
The appellant conducted transactions at Superforex in a total sum of AUD$1,149,000 in the name of "William Cai", using a driver licence and mobile telephone numbers in Mr Cai's name. Mr Cai was a person the appellant knew, but Mr Cai did not know of the appellant's use of his identity and was unaware of these transactions.
In respect of the transactions at Fast Exchange, the appellant falsely used the name of a Ms Liang and a Mr Zhao. Ms Liang recalled an occasion during her employment with the appellant when he asked to see her passport, but was unaware of any use he made of her details or of the transaction. Mr Zhao did not know that the appellant had obtained his details, including his driver licence details.

Sentencing judge's remarks

The sentencing judge summarised the conduct the subject of the count on the indictment as involving a total sum of AUD$1,349,000 comprising six foreign currency transactions using false names and assumed identities; using the names and identities of others without their knowledge or consent; and in circumstances where the appellant had "prevailed on" others to assist by having them make large cash deposits into banks on his behalf.
His Honour was satisfied that the appellant had developed a system for the purpose of carrying out the unlawful transactions and that his conduct "was a product of forethought and planning". His Honour considered that the appellant "was clearly motivated by financial gain". It is clear from his Honour's reasons that this observation related to the offence on the indictment. His Honour next observed that the s 16BA offences occurred over the same period.
In respect of both the offence on the indictment and the s 16BA offences, his Honour noted that the prosecution was unable to prove that the appellant knew of the source of the money, or its ultimate destination. After referring to Ansari v R (2007) 70 NSWLR 89; [2007] NSWCCA 204 at [119]-[123], his Honour stated that the focus of his assessment was therefore in respect of "what 'the offender did'". His Honour observed that the only "fault element" to which the appellant had pleaded was in respect of "intention", that is, that "he intended the money would become an instrument of crime". His Honour had earlier observed that "there can be no doubt that those who involve themselves in money laundering facilitate other criminal activity".
His Honour rejected as minimising the appellant's culpability that the scheme was such that the appellant would ultimately be detected and observed that the nature and scope of the unlawful activity involving many transactions and large amounts of cash highlighted "the very serious nature of the offending conduct".
Later in his remarks, when determining the sentence to be imposed, his Honour stated that as the appellant's criminality was high, general deterrence was of particular importance. His Honour again referred to the amount of money transferred out of Australia, noting that it was done: "… in such a way as to conceal the true identity of the transfer and to avoid accurate reporting of those transfers and the ability to trace the source of the funds."
His Honour added: "Similarly, in respect of the [s 16BA] matters, using the same method and with the same intention he transferred $1,867,500 out of Australia into the accounts in China."
His Honour observed that given the time when the plea was entered, it could not be considered to be a plea at the earliest opportunity. His Honour further remarked that, in any event, as the offence was a Commonwealth offence, "no utilitarian benefit is applicable". As already stated, this last observation was in error.
The appellant's subjective circumstances, as recounted by his Honour, were as follows. The appellant was born in China and migrated to Australia with his parents when he was aged about 12. He had limited English at the time of arriving in Australia and struggled at school. His family circumstances were stable and supportive. His parents operated a restaurant in a golf club and the appellant has worked there since leaving school, except for a period of about two years.
The appellant is married. He and his wife have two children aged 7 and 5. His wife and children are presently in China with his wife's parents, his wife having returned to China to look after her father who was unwell. Her long-term intention was to return to Australia and she came back for the purposes of the sentencing hearing at which she gave evidence.
The appellant and his wife had conducted a restaurant business which, after the appellant's arrest, was run by a manager until it was closed in early 2017. The appellant also commenced two other businesses, one selling software and the other being a "bet station" business. In early 2013, the appellant launched a money remitting business from an office in World Square, which was set up in his wife's name because of the appellant's criminal record, although she never attended the office from which the business was conducted. The World Square office was renovated at a cost of between $80,000 and $100,000.
The appellant's wife owns a house which is the family home. The property is subject to a mortgage of approximately $700,000. The appellant's wife was forced to rent out the property after the appellant was arrested so that the monthly mortgage repayments could be made. The mortgage is currently in arrears, due principally to the closure of the restaurant business and the appellant's wife not being able to work, the rent from the home being insufficient to cover the mortgage repayments.
The appellant has a criminal record dating back to 1994, which involves, primarily, stealing and fraud offences, with a number of stealing offences from when he was a juvenile. The appellant reported to a consultant psychologist, Mr Diment, who provided a presentence report, that "when he was 18 he mixed with some wrong people and commenced gambling". This led to a gambling addiction which continued until he married in 2009.
His Honour stated that the appellant's criminal record would not entitle him to leniency in sentencing. His Honour also observed that the appellant's criminal record countered any suggestion that the offence on the indictment and the s 16BA offences lacked sophistication or that the appellant lacked an appreciation of his involvement in the money laundering scheme.
The appellant did not give evidence at the sentencing hearing. In accordance with the principle in R v Qutami (2001) 127 A Crim R 369; [2001] NSWCCA 353, his Honour gave little weight to the appellant's expression of remorse to Mr Diment, the consultant psychologist. His Honour considered that, in any event, the appellant's statements to Mr Diment did not rise to any level of genuine contrition, as they ignored the criminality involved in his wrongful conduct. His Honour did accept, however, that there was some expression of remorse and acceptance of responsibility in the presentence report. His Honour also accepted the appellant's wife's evidence that the appellant told her he was "deeply remorseful". However, his Honour considered that the appellant's prospects of rehabilitation were guarded at best, having regard to his criminal history.
In respect of hardship, the appellant's parents had both suffered from cancer. The appellant had previously been responsible for taking his parents to chemotherapy treatments. His father passed away in May 2016. His Honour accepted that the appellant's family would suffer hardship if he were to be sentenced to a term of imprisonment, but that it was not such as to constitute "highly exceptional circumstances" that would cause departure from an otherwise justified term of imprisonment.

Ground 1: the sentencing judge erred when taking into account the s 16BA offences

Appellant's submissions

The appellant accepted that the sentencing judge was required to take into account the s 16BA offences in accordance with the general sentencing principles stated by Spigelman CJ in Re Attorney-General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1990 No 1 of 2002 (2002) 56 NSWLR 146; [2002] NSWCCA 518. In that case, Spigelman CJ explained, at [42], that when increasing a penalty when a s 16BA offence is involved, there are two elements which are always material to the sentencing process: the need for personal deterrence and the community's entitlement to exact retribution.
However, the appellant submitted that in finding that the appellant had "used the same method and with the same intention" in respect of the s 16BA offences, his Honour committed a De Simoni type error: R v De Simoni (1981) 147 CLR 383; [1981] HCA 31 at 389. In particular, the appellant submitted that, unlike the offence on the indictment of dealing in proceeds of crime contrary to the Criminal Code, s 400.3(1), the s 16BA offences were offences contrary to the Anti-Money Laundering and Counter-Terrorism Financing Act, ss 137(1) and 140(1), in respect of which the export of money is not an element of either offence. The appellant also pointed out that the fourth s 137(1) offence, committed on 27 March 2013, did not involve any transfer of money.
It followed on the appellant's submission that the "nature and gravamen" of the s 16BA offences was limited and they were not to be treated as if they each constituted a de facto offence contrary to the Criminal Code, s 400.3(1). Rather, for the purposes of sentencing for the offence on the indictment, a proper assessment of the criminality involved in the s 16BA offences required the sentencing judge to take into account only the elements of the s 16BA offences. The appellant contended that it was an error to assess the criminality involved in those offences by reference to a more serious offence or offences that had not been charged.

Crown submissions

The Crown submitted that given the structure and content of the sentencing judge's remarks, his Honour had clearly drawn a distinction between the offence on the indictment and the s 16BA offences. The Crown submitted that the approach posited by the appellant in this case was entirely artificial and contrived. In support of this, the Crown relied on the fact that the offence on the indictment and the s 16BA offences were connected and related in time and purpose. In particular, the Crown submitted that the transfer of money was integral to both, and that all of the offences involved the use of false names and identities for the purpose of transferring money overseas.
The Crown pointed to the fact that the offences contrary to the Anti-Money Laundering and Counter-Terrorism Financing Act, s 137(1) concerned instances where the appellant produced false documents to money remitters who were obliged to verify their customers' details before providing the designated service of transferring money overseas. Similarly, the offences contrary to the Anti-Money Laundering and Counter-Terrorism Financing Act, s 140(1) concerned the use, by the appellant, of a false name after the relevant money remittance business commenced providing him with transaction services.
Accordingly, on the Crown's submission, it was "not simply the case that an export of money coincided with the additional scheduled offences". The designated service being provided in each instance was the international transfer of money and it was that context that made the appellant's use of false names and identification documents criminal. The Crown relied on Cheng v R (2017) 94 NSWLR 72; [2017] NSWCCA 63 at [48]-[52] in support of this submission.
The Crown further submitted that a breach of the De Simoni principle only occurs if an offender is actually punished for the conduct constituting an uncharged offence or aggravating circumstance. As no punishment was imposed on the appellant in respect of any of the s 16BA offences, there was no breach of the De Simoni principle.
Finally, the Crown submitted that although the factual circumstances involved in the conduct of the s 16BA offences could have exposed the appellant to criminal liability and punishment for additional and more serious money laundering offences, that fact alone did not render it wrong for the sentencing judge to have regard to those facts when taking the s 16BA offences into account.

Consideration

Underlying the De Simoni principle is the fundamental concept that a person can only be punished for the crime of which the person is convicted. As Gibbs CJ explained in that case, at 389: "… the general principle that the sentence imposed on an offender should take account of all the circumstances of the offence is subject to a more fundamental and important principle, that no one should be punished for an offence of which he has not been convicted … The combined effect of the two principles, so far as it is relevant for the present purposes, is that a judge, in imposing sentence, is entitled to consider all the conduct of the accused, including that which would aggravate the offence, but cannot take into account circumstances of aggravation which would have warranted a conviction for a more serious offence."
This principle was recently endorsed in Nguyen v R (2016) 256 CLR 656; [2016] HCA 17 where Bell and Keane JJ observed, at [29]: "… the De Simoni principle is an aspect of the fundamental principle that no one should be punished for an offence of which the person has not been convicted."
The mental element in the offence of dealing in proceeds of crime contrary to the Criminal Code, s 400.3(1) involves intention. The person must deal with money or other property "intend[ing] that the money or property will become an instrument of crime". The mental element for each of the ss 137(1) and 140(1) offences under the Anti-Money Laundering and Counter-Terrorism Financing Act, being the s 16BA offences, is different.
Section 137(1) concerns producing a false or misleading document to, inter alia, a reporting entity, knowing that the document is false or misleading. The mental element for this offence, therefore, is knowledge. Section 140(1) concerns commencing to receive a designated service using a false customer name in circumstances where a provision of the Anti-Money Laundering and Counter-Terrorism Financing Act regarding identification procedures applies. Section 140(1) requires the production of a false customer name. In that regard, the mental and physical elements of the offence coincide. Relevantly, in relation to the argument raised by the appellant, in neither s 137(1) nor s 140(1) is there any mental element of intention, let alone an intention to engage in or facilitate a crime.
The passage of which the appellant complained, namely, that: "… in respect of the [s 16BA] matters, using the same method and with the same intention [as in respect of the offence on the indictment, the appellant] transferred $1,867,500 out of Australia into accounts in China …" taken on its own, might have indicated that his Honour considered that the s 16BA offences were committed with the same mental element as that required for the s 400.3(1) offence.
However, that understanding of his Honour's remarks would be to take his Honour's remarks out of context. The passage of which the appellant complained followed immediately upon his Honour's observation reproduced above at [29]. His Honour's reference there was not to the mental element of the offence, but rather to the modus operandi used by the appellant and the purpose in using that modus operandi, namely, to conceal his identity and to avoid the accurate reporting of the transactions by the reporting entity and the ability to trace the source of the funds.
I accept, as the Crown submitted, that the principle in De Simoni only applies where a person is in fact sentenced for conduct constituting an uncharged offence or aggravating circumstance and, to that extent, the appellant's argument should be rejected. Further, as the Crown submitted, the nature and seriousness of the s 16BA offences is relevant to determining an appropriate sentence for the offence on the indictment.
His Honour was entitled to take into account the matters to which he referred, being part of the offending conduct the subject of the s 16BA offences and thus to the nature and seriousness of that conduct, not for the purpose of imposing punishment for those offences, but for purposes for which matters on a s 16BA may be taken into account, including the need for personal deterrence and the community's entitlement to exact retribution. As Spigelman CJ stated in Re Attorney-General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1990 No 1 of 2002 at [42]: "The position … is that, although a court is sentencing for a particular offence, it takes into account the matters for which guilt has been admitted, with a view to increasing the penalty that would otherwise be appropriate for the particular offence."
Accordingly, I do not consider that his Honour erred as alleged. It follows that, to that extent, the sentence imposed on the appellant was not affected by error.

Ground 3: the sentence imposed is manifestly excessive

Although as indicated, it is not strictly necessary to consider this ground, as the appellant is to be resentenced in any event, it is relevant to consider the cases upon which the appellant relied by way of assistance in the resentencing process.
The appellant submitted that, as was apparent from a comparison with 13 other cases involving sentences imposed for an offence under the Criminal Code, s 400.3(1), the sentence imposed on the appellant was manifestly excessive and that a lesser sentence was warranted. In response, the Crown submitted that the cases relied on by the appellant do not demonstrate that the sentence was outside the bounds of reasonable sentencing discretion.
The appellant provided the Court with an extract from the Commonwealth Sentencing Database (the Database list), which listed 13 cases (in addition to the case on appeal in this matter) between 2011 and 2016 in which sentences were imposed for an offence pursuant to the Criminal Code, s 400.3(1). As is well recognised, the cases referred to in the Database list do no more than establish a range of sentences that have been imposed for a s 400.3(1) offence. To that extent, they provide some guidance and serve as a yardstick against which to examine a proposed sentence. In determining an appropriate sentence, however, it remains necessary to examine the whole of the circumstances of the particular case: Director of Public Prosecutions (Cth) v De La Rosa (2010) 79 NSWLR 1; [2010] NSWCCA 194 at [303]-[305], cited with approval in Hili v R; Jones v R (2010) 242 CLR 520; [2010] HCA 45 at [54].
Bearing this in mind, the cases in the Database list can be categorised into three groups, based on the length of the sentence imposed. In six cases, a term of imprisonment of between 2 years 6 months and 5 years was imposed. In those cases, the non-parole period ranged between 0 months and 2 years, 6 months. In four cases, a term of imprisonment of between 5 years, 6 months and 7 years was imposed. In those cases, the non-parole period ranged between 3 years and 4 years. In three cases, a term of 8 years, 6 months was imposed. The non-parole period in each case was 5 years, 6 months.
In addition to referring to the Database list of cases, the appellant relied on Director of Public Prosecutions v Lai [2013] VCC 1318 and Islam v R [2016] NSWCCA 233. The Crown for its part referred to R v Huang; R v Siu (2007) 174 A Crim R 370; [2007] NSWCCA 259, which it submitted provided "a cogent indication of why the sentence imposed [on the appellant was] not manifestly excessive".

Director of Public Prosecutions v Lai

In Lai, the offender was convicted of one offence contrary to the Criminal Code, s 400.3(1) and one offence contrary to the Criminal Code, s 400.9(1). The offence contrary to s 400.3(1) involved a money laundering scheme comprising 191 separate transactions and a sum of $1,909,580. When the offender was arrested, he was found with a further sum of $174,310 in cash in a shoebox. The offence contrary to s 400.9(1) arose from a number of other money laundering transactions totalling a sum of $166,702. Those transactions involved the depositing of money into either Chinese or Taiwanese bank accounts. On the offender's own admission, the monies involved were reasonably suspected of being proceeds of crime. It was apparent from intercepted telephone conversations that the offender knew that these transactions were being committed on behalf of, and for the benefit of, a substantial commercial drug trafficking syndicate and that the transactions involved the proceeds of the activities of that syndicate.
The sentencing judge described the offender, at [4], as playing "a pivotal role on behalf of a major drug trafficking syndicate, operating internationally, in the full knowledge of the nature of their activities". The sentencing judge considered, at [5], that the offender's conduct with respect to the first offence was to be "regarded as a very serious offence of its kind, and towards at least the middle to top end of the range for the purposes of establishing [the offender's] degree of culpability".
At the time that the offending conduct occurred, the offender was experiencing financial difficulties, his marriage had broken down and he was suffering from depression. The offender had a previous conviction for three charges of dealing with property suspected of being proceeds of crime, for which he had been sentenced to a community based order for 6 months. He also had a previous conviction for conspiracy to cheat and defraud, for which he was sentenced to a total of 4 years imprisonment with a non-parole period of 2 years. The offender was serving this term of imprisonment at the time of his sentence for the offences in this case. Despite this previous offending, some of which occurred while the offender was on bail, the sentencing judge was of the view, at [15], that the offender had good prospects of rehabilitation.
The sentencing judge also observed that, despite the offender's previous offending, the offender had a very good reputation for honesty and decency, although noted that his previous offending meant that he did not come before the court as a person of good character. The sentencing judge was invited to take into account the fact that the offender pleaded guilty. However, his Honour noted, at [14], that he did not see much, if any, evidence of genuine remorse on the part of the offender. Nor did his Honour take into account the utilitarian value of the plea, which has now been determined in Xiao to be appropriate. His Honour considered general deterrence to be a significant sentencing consideration.
The sentencing judge sentenced the offender to imprisonment for a period of 8 years for the offence contrary to s 400.3(1) and 15 months for the offence contrary to s 400.9(1). The total sentence was therefore 8 years, 6 months. His Honour determined that the non-parole period should be 5 years, 6 months.

Islam v R

In Islam, the applicant was convicted of one offence contrary to the Criminal Code, s 400.3(1) and one offence contrary to the Criminal Code, s 400.9(1). These offences occurred when the applicant attempted to remove $1,023,900 in cash from the country. The cash was hidden in shoe bags in the applicant's luggage and that of certain family members travelling with him. The applicant was charged along with two other individuals who participated in the scheme. The offences concerned were committed three months after the applicant had completed a period of parole.
According to the applicant's presentence report, he had been using the drug ice for six months prior to his arrest. He claimed that he had been in debt to his drug dealer and that this was his motivation for becoming involved in the offences. The applicant had a lengthy criminal history in New South Wales extending back to 2005, including a number of driving offences and offences of obtaining money by deception.
The applicant's role was found to be the most significant of the three offenders, his Honour finding that even though the applicant did not appear to be the owner of the money, he was "at the very least a highly trusted associate". The sentencing judge noted that despite the plea of guilty, there was no evidence of contrition and that, as the applicant had been caught "red-handed", making an order forfeiting the money was inevitable.
On appeal, the Court found errors in the sentencing process and resentenced the applicant to a term of imprisonment of 4 years, 9 months, with a non-parole period of 3 years, 6 months.

R v Huang; R v Sui

Although this case involved two offenders, it is only necessary to consider the case in respect of Huang, the second offender, Sui, having been charged with the lesser offence under the Criminal Code, s 400.4.
Huang pleaded guilty to an offence contrary to the Criminal Code, s 400.3(1). Over a 10 month period, Huang had conducted 335 banking transactions involving money with a value of more than $1,000,000. He received fees of approximately $30,000. The sentencing judge imposed a sentence of 3 years imprisonment with a direction to enter a 3 year good behaviour recognisance at the expiration of 21 months. The starting point identified by the judge of 6 years, 6 months was reduced by 25 per cent for the guilty plea, along with a small discount for contrition. Huang also received an additional discount of slightly above 25 per cent for his cooperation with the authorities.
The sentencing judge found that Huang believed the money had been acquired through a genuine business venture and that the purpose of transferring it overseas was to avoid Australian taxation. His Honour accepted that Huang was a "very much-trusted employee" and played an important role in the scheme. He also found that Huang had gambled to excess and was in need of funds, which led to him being tempted to become involved.
The sentencing judge considered that the offence was objectively serious, having regard to the considerable sum involved, the number of transactions, the period over which it occurred and the planning involved. His Honour found, however, that Huang had provided "extremely valuable" assistance to investigating authorities and was satisfied that he had shown "great contrition". Accordingly, his Honour found that Huang did not require any further personal deterrence.
The Court found that Huang's sentence was manifestly inadequate. It pointed to two significant factors to be considered when sentencing for this type of offence: first, the amount of money involved and second, the number of transactions, with a greater number signifying greater criminality. The Court considered that Huang's criminality fell within the mid-range of offending and that, due to the nature of the offences, severe punishment was warranted to reflect general deterrence. The Court considered that the starting point in resentencing Huang should have been at least 11 years. On resentence, the Court allowed a discount of 50 per cent for the plea of guilty and for assistance, although stated that this was generous. The Court imposed a sentence of imprisonment of 5 years, 6 months with a non-parole period of 3 years, 4 months. In doing so, the Court emphasised that this sentence was lenient, given that it was a Crown appeal. This last observation is no longer the law: see the Crimes (Appeal and Review) Act 2001 (NSW), s 68A.

Resentence

Leaving to one side the error in failing to have regard to the plea of guilty, I would not have found error in the sentence imposed on the basis that it was manifestly excessive, although it must be said it was not a lenient sentence. However, in resentencing, the Court is not bound by the sentence imposed by the sentencing judge. Rather, as the High Court explained in Kentwell v R (2014) 252 CLR 601; [2014] HCA 37, at [43], on resentence, the court may conclude that a lesser sentence is warranted in law or that the same or a greater sentence is warranted. In either case, the sentence imposed must be in the independent exercise of the appellate court's discretion.
The offence of which the appellant was convicted, as the authorities recognise, is a serious one, and the subjective circumstances of the appellant were not such as to warrant leniency beyond the sentencing judge's acceptance of the appellant's expression of some remorse. His prospects of rehabilitation were assessed as guarded and nothing has been advanced on appeal to indicate that any different assessment should be reached in that regard.
As the Database list of cases indicates, sentences for the s 400.3(1) offence vary significantly, although it is not known whether, in respect of any of the cases in the list, there were discounts for assistance or a guilty plea, or whether offences on a s 16BA were taken into account.
Insofar as the cases upon which the appellant relied, Lai involved more serious offending, but his subjective circumstances were more compelling than those of the appellant. There were no matters taken into account pursuant to s 16BA. In considering Lai, I have put to one side the 15 months imposed for the s 400.9(1) offence and have had regard only to the sentence of 8 years imposed for the s 400.3(1) offence. In Islam, in which a serious s 16BA matter was taken into account, a discount of 25 per cent was applied for the plea of guilty so that the effective starting point of the sentence was approximately 6 years. By contrast, in Huang, the starting point for the sentence was 11 years. In that case, there were hundreds of transactions, but the total amount involved was less than in the case of the appellant's offence.
In my opinion, none of these cases provides any particular assistance in determining the appropriate sentence to impose in this case, other than reinforcing that an offence contrary to s 400.3(1) is a serious one and that general deterrence is of particular importance in the sentencing of an individual offender.
The appellant in this case pleaded guilty and is thus entitled to some discount for his plea. The utilitarian value of a guilty plea depends primarily upon the timing of the plea. In R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309, Spigelman CJ (Wood CJ at CL, Foster AJA, Grove and James JJ agreeing) stated at [152]-[154]: "In my opinion, the appropriate range for a discount is from 10-25 percent. The determination of where, within such a range, the discount should fall in a particular case is a matter for the discretion of the sentencing judge. There are however two circumstances which will generally affect the appropriate level of discount in a particular case: (i) The time at which a plea is entered. A plea entered at committal has a more significant utilitarian benefit than a plea entered at first listing, which in turn has the greater benefit than a plea entered at the beginning of trial. (ii) The complexity of the issues about which evidence will have to be gathered and adduced affects the value of the plea. The greater the difficulty of assembling the relevant evidence and the greater the length and complexity of the trial, the greater the utilitarian value of a plea."
Spigelman CJ observed, at [155], that a discount at the top of the range would be restricted to pleas entered into at the earliest possible opportunity and should not be given, save in an exceptional case, after a matter has been set down for trial. His Honour stated that a discount at the bottom of the range would be appropriate for late pleas, such as a plea entered into on the date fixed for trial.
Consistent with these observations, in the recent decision of Nash v Silver City Drilling (NSW) Pty Ltd; Attorney-General for New South Wales v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96, Basten JA (Hoeben CJ at CL and Walton J agreeing) stated that where a plea is entered on the first day fixed for trial, the utilitarian value of the plea must be "severely reduced". As Adams J (Hoeben CJ and Button J agreeing) observed in Zhao v R [2016] NSWCCA 179, a discount of 10 per cent is usually allowed for a plea entered in such circumstances. In Hart v Attorney-General for New South Wales [2016] NSWCCA 71, Davies J (Hoeben CJ at CL and Harrison J agreeing) rejected the applicant's submission that a discount of 10 per cent for the applicant's guilty plea was inadequate. In that case, the applicant first indicated to the court his intention to plead guilty on the first day of the trial and only indicated such an intention to the prosecution on the Friday before the trial was due to start on the following Monday.
In Thomson; Houlton, which involved a state offence, Spigelman CJ did not purport to be prescriptive as to the discount that should be given in any particular case. As Spigelman CJ stated, it was a matter for the discretion of the sentencing judge as to the discount to be applied. There is, however, an inevitable logic in his Honour's observations that the time at which a plea is entered is relevant to the discount to be applied. But as the portion of his Honour's reasons cited above reveal, it is not the only consideration and may not be a decisive consideration in the given case. Nor is the range suggested by his Honour the necessary limit of the upper and lower range, although it is a useful guide. It is not, however, to use the language of the High Court in Hili, a 'norm'.
The Court is presently concerned with sentencing for a federal offence. In Hili, the High Court held, at [13] and [44], that there was no "judicially determined norm or starting point … for the period of imprisonment that a federal offender should actually serve in prison". The so-called 'norm' of which the High Court was expressing its disapproval was the practice or convention in New South Wales of specifying, as the minimum period that an offender should serve in prison, a figure of 60 to 66 per cent of the term of imprisonment imposed.
In the present case, the plea was only entered on the day that the appellant's trial was listed for hearing. In addition, as the facts reveal, the case was not particularly complex. Accordingly, the utilitarian value of the plea was not high. Nonetheless, I consider that some discount ought to be allowed for the plea and that discount should be at the low end. In all the circumstances, I consider that an appropriate discount is 10 per cent for the appellant's guilty plea. I would otherwise determine the sentence to be imposed by reference to the findings of the sentencing judge in respect of the objective seriousness of the offence and the appellant's subjective circumstances, and taking into account the s 16BA offences and the updated evidence filed by the appellant to which I next refer.
The appellant filed an affidavit in which he outlined his progress and his circumstances in custody. An affidavit has also been filed by the solicitor with conduct of his matter annexing a case note report of the Department of Corrective Services. In brief, the appellant has engaged in employment since being taken into custody and is presently employed at a wildlife centre, where he cares for various species of native animals.
According to the case note report of the Department, the assessments of the appellant's work performance, self-management skills, initiative, communication skills, application and responsibility have always been positive. A report from the chaplaincy service at the correctional complex also stated that the appellant has consistently applied himself to work and has undertaken a number of education programs whilst in custody. The chaplaincy service reported that from "interactions, observations and inquiries" with the appellant, he has used his time in custody constructively and has had the "opportunity to reflect on his actions and gain a greater understanding".
This evidence indicates that the appellant's prospects of rehabilitation now appear to be more positive than at the time of the assessment of the sentencing judge.
In all of the circumstances, including taking into account the s 16BA offences, and allowing a 10 per cent discount for the plea of guilty, I consider that the appellant should be sentenced to a term of imprisonment of 6 years, 3 months commencing on 9 December 2015 to expire on 8 March 2022, with a non-parole period of 4 years, 8 months to expire on 8 August 2020. I consider that this is the minimum period justice requires that the appellant should serve in custody for his offence.
I propose the following orders: (1) Grant the appellant leave to appeal against sentence. (2) Appeal allowed. (3) Quash the sentence imposed on the appellant on 9 December 2015 and in lieu thereof, sentence the appellant to a term of imprisonment of 6 years, 3 months commencing on 9 December 2015 to expire on 8 March 2022. (4) In accordance with the Crimes Act 1914 (Cth), s 19AB(1), fix a non-parole period of 4 years, 8 months to expire on 8 August 2020.
HOEBEN CJ at CL: I agree with Beazley P and the orders which she proposes.
McCALLUM J: I have had the benefit of reading the judgment of Beazley P in draft. I agree that, as a result of this Court's judgment in Xiao v R [2018] NSWCCA 4, ground 2 must succeed. It follows that the applicant must be re-sentenced in accordance with the principles stated in Kentwell v R (2014) 252 CLR 601; [2014] HCA 37.
In that circumstance, it is not necessary to address the other grounds. However, as Beazley P has addressed ground 1, it is appropriate to record my own conclusion regarding that ground. As this issue is addressed in detail in her Honour's judgment, my reasons can be stated briefly.
In my respectful opinion, there is a difficulty in the way in which the learned sentencing judge addressed the offences listed on the s 16BA schedule. As noted by Mr Dhanji SC in his oral submissions, his Honour faced a difficult sentencing task which was complicated by the way in which the facts were presented. The statement of facts described all of the offences in the same generic terms, conflating the conduct reflected in the count on the indictment with that reflected in the offences listed on the schedule. The statement of facts said: "The transfers conducted at Superforex and Fast Exchange are the subject of the count contained on the Indictment. Those transfers totalled $1,349,000… The transfers conducted at Anying, DS Finance, Supay and Ocean Pass are all the subject of the counts contained on the Schedule pursuant to section 16BA of the Crimes Act 1914 (Cth). These transfers totalled $1,867,500… During the period from 21 March to 7 May 2013, the Offender converted a total amount of AUD $3,216,500…"
In recording the relevant facts, the sentencing judge recited those paragraphs almost verbatim. That is an unexceptionable approach for which his Honour is not to be criticised. The difficulty is that, in the present case, the statement of facts put a gloss on the conduct that constituted the offences listed on the schedule.
Contrary to the conclusion reached by Beazley P, I am satisfied that the manner in which the schedule offences were represented in the statement of facts did distort his Honour's assessment of the seriousness of those offences. His Honour concluded that the offender's objective criminality was high, framing that conclusion by reference to the conduct in the offence on the indictment and the fact that, "in respect of the Form matters, using the same method and with the same intention he transferred $1,867,500 out of Australia…" As submitted by the applicant, neither intention nor the fact of transfer was an element of the offences on the schedule. Since writing this judgment I have had the benefit of reading the judgment of the Chief Justice in draft. I would respectfully accept that there is force in the view his Honour expresses at [9], that it may not have been erroneous to have regard to the amount of funds transferred as a consequence of the commission of the schedule offences. The criminal law pays regard to consequences. However, in my respectful opinion, the sentencing judge did also import the fault element relevant to the count on the indictment (intention) into the schedule offences. My consideration of the sentencing judgment as a whole has persuaded me that, in doing so, his Honour overestimated the seriousness of those matters when taking them into account.
Strictly speaking, I do not think this was an error of the kind identified in The Queen v De Simoni (1981) 147 CLR 383; [1981] HCA 31. The application of the principle stated in that case is confined to the offences for which an offender is in fact sentenced and does not extend to matters taken into account in accordance with s 16BA. However, in my respectful opinion, in imputing an element of intention that was not an element of the schedule offences in his assessment of the objective seriousness of those offences, his Honour had regard to an irrelevant consideration which distorted the sentencing task in some measure.
In any event, it is necessary to resentence the offender on the basis that it is permissible to take the utilitarian value of the plea into account: Xiao at [278]. In Xiao at [280], we said that it is desirable, in the interests of transparency, to specify the discount allowed on that account but that there is no obligation to do so and that failure to do so would not of itself amount to error. The quantification of such a discount is not inconsistent with the instinctive synthesis approach to sentencing where the discount relates to a non-sentencing purpose: Markarian at [74].
I agree that, in quantifying the discount allowed for the utility of a plea in this context, some guidance might be drawn from the decision in R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309 at [152] to [154], so long as care is taken not to elevate the guideline stated in that decision to the status of a judicially-determined norm for offences against Federal law. There is much to be said for taking a consistent approach in respect of State and Federal offences, but it must always be borne in mind that s 16A of the Crimes Act 1914 (Cth) requires the sentencing court to "impose a sentence or make an order that is of a severity appropriate in all the circumstances of the offence", which the Court in Hili at [25] construed to mean the particular offence for which a sentence is to be imposed, with all its individual features.
Returning to the task of re-sentencing, save as to any different conclusion explained in this judgment, I would respectfully adopt the summary of the relevant factors identified by Beazley P.
I consider there is much force in the submissions put by Mr Dhanji as to the comparisons between the present case and the case of Islam v R [2016] NSWCCA 233, which is considered in detail in the joint judgment. However, while the offender in that case did have a further offence taken into account on a schedule, the offences on the schedule in the present case are more in number and reflect higher criminality.
I agree that the utilitarian value of the plea in the present case was limited and would accept that 10% is an appropriate discount. I agree that the evidence relied upon by the applicant on resentence establishes that his prospects of rehabilitation now appear to be more positive than at the time of the assessment of the sentencing judge; in my view, significantly so.
For those reasons, I would have resentenced the applicant to a term of imprisonment for 5 years and 6 months with a non-parole period of 3 years and 8 months.
BELLEW J: I agree with Beazley P.

Amendments 30 April 2018 - Coversheet: appearances amended DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 April 2018

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