Quetcher v R

Court of Criminal Appeal (NSW)|2010-09-24|Before: Latham J, Price J, Mr P, Clellan CJ

CITATION: Quetcher v R [2010] NSWCCA 257 This decision has been amended. Please see the end of the judgment for a list of the amendments.

JUDGMENT OF: McClellan CJatCL at 1; Latham J at 2; Price J at 3

DECISION: (i) Leave to appeal granted. (ii) Appeal dismissed.

Criminal Code Act (Cth) 1995 s 134.1, s 134.1(1), LEGISLATION CITED: s 134.2, s 134.2(1) Crimes Act 1914 (Cth) s 16A(1), s 16A(2), s 16A(2)(h)

Ali v R [2010] NSWCCA 35 Alseedi v R [2009] NSWCCA 185 Gok v R [2010] WASCA 185 Ly v R [2007] NSWCCA 28 Markarian v R (2005) 228 CLR 357 Pearce v R (1998) 194 CLR 610 CASES CITED : R v Hawkins (1989) 45 A Crim R 430 R v Knight [2004] NSWCCA 145 R v MAK; R v MSK (2006) 167 A Crim R 159 R v Olbrich (1999) 199 CLR 270 R v O'Keefe (1992) 60 A Crim R 201 R v Pont [2000] NSWCCA 419 R v Pipes [2004] NSWCCA 351 Sanchet v Director Public Prosecutions (Cth) [2006] NSWCCA 291

PARTIES: Regina Marita Quetcher

COUNSEL: Mr I Nash (Applicant) Mr P McGuire (Crown/Respondent)

SOLICITORS: Legal Aid Commission of NSW (Applicant) Commonwealth Director of Public Prosecutions (Respondent)

IN THE COURT OF CRIMINAL APPEAL 2009/1463

McCLELLAN CJ at CL LATHAM J PRICE J

11 November 2010 QUETCHER v R Judgment 1 McCLELLAN CJ at CL: I agree with Price J. 2 LATHAM J: I agree with Price J. 3 PRICE J: The applicant was arraigned on 27 July 2009 in the District Court at Sydney on an indictment containing sixty-five counts of dishonestly obtaining a financial advantage by deception, being a general deficiency in money, belonging to Medicare Australia, a Commonwealth entity, with the intention of permanently depriving Medicare Australia of that money, contrary to s 134.1(1) of the Criminal Code Act (Cth) 1995. Pleas of not guilty were entered to each count. 4 After an eleven-day trial before a jury of twelve, the applicant was found guilty on each count. She was sentenced by Solomon DCJ on 18 December 2009 as follows: Counts 1-22 inclusive: 3 years imprisonment commencing on 10 August 2009 and expiring on 9 August 2012; Counts 23-44 inclusive: 3 years imprisonment commencing on 10 August 2011 and expiring on 9 August 2014; Counts 45-65 inclusive: 3 years imprisonment commencing on 10 August 2014 and expiring on 9 August 2017. 5 A single non-parole period of 5 years was set by the Judge commencing on 10 August 2009 and expiring on 9 August 2014. As a result of partial accumulation, the total aggregate sentence is 8 years with a non-parole period of 5 years. The applicant is eligible for release to parole on 9 August 2014. 6 The maximum penalty for an offence contrary to s 134.1(1) of the Criminal Code Act is imprisonment for 10 years. 7 The applicant now appeals against the sentences imposed on the following grounds: "1. His Honour erred in taking into account the content of the applicant's record of interview when considering the degree to which she had co-operated with law enforcement agencies: s 16A(2)(h) Crimes Act .

His Honour erred in his assessment of the applicant's chances of re-offending by failing to take into account relevant material.

The sentences were manifestly excessive." Facts 8 The Judge delivered his sentencing remarks ex tempore immediately after the sentencing hearing. 9 The Judge found that the evidence in the trial established the following (ROS at 1-4): "In 1983 the offender commenced employment with the Health Insurance Commission which subsequently changed its name to Medicare Australia ("Medicare"). The offender remained in employment with Medicare in 2007.

In 1988 the offender became the Branch Manager of Medicare's Shellharbour branch. Her duties and functions as Branch Manager included the following: To supervise staff to ensure compliance by staff with Medicare policies. Allocate, monitor and secure cash allocated to the branch. Ensure that cash claims were paid if supported by genuine appropriate documentation. To ensure the accuracy and integrity of information entered into the Medicare computer system. To be responsible for security for cash allocations. To ensure the accuracy, integrity and continuity of documents required to be retained by Medicare.

In February 2007 Mr Roger Ford, an employee of Medicare, as part of his function as a data specialist reviewed a spread sheet which indicated a pattern of unusual features in relation to a number of claims made in respect of a Medicare claimant named Dani Forest. It was noted by Mr Ford that each of the claims had been processed under the offender's operator number. An investigation ensued and he discovered further anomalies in relation to cash claims, which had been processed under the offender's computer operator number.

The Medicare system of audit requires that all documents in support of enrolments of Medicare claims be kept in batch envelopes which are archived in the Medicare storage facilities. The investigation of the offender's computer records and the batch claims revealed that during the period of approximately five years relevant to the charges contained in the indictment, the offender enrolled 65 false identities as members of Medicare and processed some 387 fraudulent claims for medical benefits in those false names. The total amount paid to the offender, having regard to those activities totalled $156,034.50.

Neither the offender nor anyone else was entitled to any of that money. It is not my intention to refer to each of the claims in the counts in the indictment, however it should be noted that in many cases the offender filed false documents and made false notations in the batch envelopes which were retained in Medicare records.

On some occasions photocopies of documents were contained in the batch envelopes. Those photocopies indicated certain payments paid to medical practitioners and it was clear from the documentation that the offender had used photocopy techniques so as to falsify those documents for the purpose of perpetrating her fraud.

The offender not only worked at the Shellharbour branch of Medicare, but on occasions worked at the Wollongong branch of Medicare. During some of the period of time she worked at the Wollongong branch she perpetrated frauds against Medicare by creating false members of Medicare and by paying out monies to herself to which she was not entitled.

The offender was spoken to by Mr Pavlov, a Medicare investigator on 7 February 2007. The offender denied her involvement in any of the frauds which at that stage come [sic] to hand and said it was possible that another Medicare employee had used her computer to enter false information in the Medicare system and to process the false claims when she had momentarily left her workstation unattended.

During the taped record of interview the offender named two employees, [Y] and [M] whom she suggested may have had a financial motive to commit the offences. Both Y and M who gave evidence at the trial and indicated they had not ever processed enrolments using the offender's computer utilising her operator number or processed cash claims using the offender's computer or operator number, or paid a cash claim out of the offender's cash bag or workstation safe, or that they knew the offender's computer password which was necessary in order to activate the offender's computer.

The attendance records tendered in the trial established that the offender was present at each office location, at Shellharbour and Wollongong on each date and each time the Medicare computer system recorded a fictitious or a fraudulent cash payment. It is relevant to note that no other Medicare employee who worked at the Shellharbour Medicare office during the period 1 June 2002 was commonly present at the Wollongong office when the offences were perpetrated at that office.

The offender over a period of time committed frauds on Medicare."

10 The offences had been committed by the applicant between 7 June 2002 and 1 February 2007. The total amount of the monies fraudulently obtained from Medicare amounted to $156,034.50, none of which had been repaid. The Judge found that each offence was "objectively extremely serious, having regard to the fact that they were pre-meditated and deliberate". He regarded each offence as being "well above the mid-range of objective seriousness." 11 The applicant, the Judge said, had abused the trust, which was reposed in her by her employer. He remarked that there was ample authority that persons "who abuse their position of trust must expect condign punishment." 12 His Honour observed that there was no motive for the offences. There was no material, which indicated any need for money. The Judge said that he could "only come to the view that the money was taken for her own purposes."

Subjective Circumstances 13 At the time of sentence, the applicant was 48 years old. She did not give evidence during the trial or the sentencing proceedings. Her subjective circumstances were placed before the Judge by way of a Probation and Parole report, which his Honour summarised as follows (ROS at 8): "The offender up until her imprisonment resided with her husband who is involved in the finance industry and her twenty year old daughter. The pre-sentence report indicates that the family has always managed its finances well, that the family owns a home and has an investment property. The pre-sentence report indicates that the family has remained supportive of the offender. The pre-sentence report indicates that the offender completed her Higher School Certificate at the age of seventeen and has been employed in the health care industry for many years. The pre-sentence report indicates that after the offender left employment with Medicare that she obtained employment with another healthcare provider. The pre-sentence report indicates that the offender has led a stable lifestyle and she is not involved in gambling and that she has no issues involving alcohol or other drugs." 14 The applicant did not have any prior criminal convictions.

Ground 1 : His Honour erred in taking into account the content of the applicant's record of interview when considering the degree to which she had co-operated with law enforcement agencies: s 16A(2)(h) Crimes Act. 15 Section 16A(2) Crimes Act 1914 (Cth) states that "the court must take into account such of the following matters that are relevant and known to the court". Section 16A(2)(h) is included in the matters listed under s 16A(2) and provides as follows: "…the degree to which the person has co-operated with law enforcement agencies in the investigation of the offence or of other offences." 16 During his sentencing remarks, the Judge specifically referred to s 16A(2)(h) and said (ROS at 6):

"As I indicated earlier, the offender entered into an interview in February 2007 regarding the offences. [The applicant] told lies to the investigator when she denied involvement in the offences. Additionally, [the applicant] attempted to blame other employees for the commission of the offences." 17 The applicant submitted that what had been said during the record of interview was irrelevant as she had denied responsibility for the offences and nominated others who might have committed them. No submission had been made on the applicant's behalf during the sentencing proceedings that she should be given a discount for co-operation with the investigating authorities. The applicant contended that, in taking into account the content of the record of interview in the manner he did, the Judge was treating the nature of the defence case as an aggravating factor, which was impermissible. 18 During oral argument in this Court, Mr Nash, counsel for the applicant, referred to an exchange during the proceedings on sentence between the applicant's then counsel and the Judge which was said to demonstrate that his Honour was very mindful of the way in which the applicant's defence had been conducted. The exchange included his Honour's remarks "that she pointed the finger to investigators that [sic] the possibility of other persons having committed the offences" (AB 337). Mr Nash submitted that as the pronouncement of sentence immediately followed, the Judge was taking that consideration into account improperly in determining the appropriate sentence. 19 I do not consider that there is merit in this ground of appeal. In written submissions to the Judge, the Crown identified various matters in s 16A(2) which required consideration. As to s 16A(2)(h), the Crown put to the Judge that although the applicant participated in a record of interview she had denied responsibility and attempted to blame other employees. As a consequence, she had not provided any assistance to the authorities. 20 The applicant had voluntarily participated in a taped record of interview with an investigating officer on 7 February 2007, which lasted just over an hour and a short, recorded conversation. The fact that she had done so could not simply be ignored, particularly in view of the Crown's submissions. The Judge was required to consider whether what she had said amounted to co-operation or assistance to authorities under s 16A(2)(h) and if so, whether that assistance entitled the applicant to a discount in her sentence. 21 In his sentencing remarks, the Judge addressed each of the matters in 16A(2) which had been referred to in submissions. What was said by his Honour in the passage quoted at [16] above indicates his acceptance of the Crown's submissions on s 16A(2)(h) and his reasons for not discounting the sentence for co-operation or assistance. Although the Judge made reference to the applicant having "pointed the finger to investigators" of the possibility of the commission of the offences by others in his discussion with counsel, the Judge was responding to the submission that he should make a finding of fact that the applicant was unlikely to re-offend. There is nothing, in my opinion, in the sentencing remarks which suggests that the Judge treated the nature of the defence case as an aggravating feature and I would reject this ground of appeal.

Ground 2 : His Honour erred in his assessment of the applicant's chances of re-offending by failing to take into account relevant material . 22 The focus of the asserted error is the following passage in the sentencing remarks (ROS at 8): "It was submitted to me by Mr Doris of counsel that I should find that the chances of the offender re-offending are low, I cannot come to that decision as there is absolutely no material before me to support that submission." 23 The applicant contended that the Judge erred in his assessment of the applicant's chances of re-offending. In particular his conclusion that there was "absolutely no material" before him to support a finding that the chance of re-offending was low, failed to have regard to evidence that was relevant to that issue. The applicant pointed to the unchallenged evidence before the Judge that she was of prior good character and had the continuing support of her family. The Judge, the applicant argued, could also properly have had regard to the deterrent effect of the sentences upon her when considering whether or not she was likely to re-offend. 24 The Crown submitted that the Judge noted in his sentencing remarks that the applicant was a person of previous good character and the pre-sentence report indicated that her family remained supportive of her. The Crown said that the Judge's remarks ought to be read in the context of an invitation by defence counsel to make a finding that there was a prospect that the applicant would not re-offend. The Crown argued that the Judge dealt with that submission and the result was a neutral finding. His Honour neither made a finding that she was not likely to re-offend nor that she was. 25 The maintenance of innocence after being found guilty at trial does not automatically deprive an offender of a finding that she would be unlikely to re-offend: Alseedi v R [2009] NSWCCA 185 at [65]; Ali v R [2010] NSWCCA 35 at [48]. This Court observed, however, in R v MAK; R v MSK (2006) 167 A Crim R 159 at [41] that remorse is a major factor in determining whether an offender is likely to re-offend and has good prospects of rehabilitation. The Court considered that without true remorse, it is difficult to see how either finding could be made. 26 The applicant bore the onus of establishing on the balance of probabilities that this factor of mitigation should be taken into account in her favour: R v Olbrich (1999) 199 CLR 270. The applicant did not give evidence during the trial or at the sentencing hearing. The only evidence tendered during the sentencing hearing was the Probation and Parole report. 27 The criticised passage in the Judge's remarks came at the end of his Honour's consideration of s 16A(2)(m) which obliges the court to take into account such as is relevant and known to the court of "the character, antecedents, age, means and physical or mental condition of the person." His Honour observed that the applicant had not given evidence nor was there any material before him as to her subjective circumstances other than the absence of a prior criminal history and that prior to the commission of the offences the applicant was a person of good character. His Honour said that good character did not have the same weight as it would have in other offences "for the reason that the offender would not have been placed in the position of trust were it not for her previous good character." No complaint is made of this finding. His Honour then summarised the applicant's subjective circumstances as set out in the Probation and Parole report and said he had no other information before him to assist in his assessment of the offender. The Judge went on to reject Mr Doris's submission of the low prospect of re-offending. 28 When considered in the context of all that the Judge said, I do not think that the words, "there is absolutely no material before me to support [Mr Doris's] submission", indicate that he failed to take into account all of the evidence that was relevant to the likelihood of re-offending. Rather the Judge was conveying that, on the evidence, he could not make a positive finding that the likelihood of re-offending was low. The applicant's prior good character and family support did not mandate such a finding nor did any deterrent impact that the sentence might have upon her. A major obstacle to a positive finding was the absence of the applicant's remorse. It was open to the Judge to reject the submission made by the applicant's counsel and I am not persuaded the Judge erred. The Judge did not make, it should be noted, a finding that the applicant was likely to re-offend. I would reject Ground 2.

Ground 3 : The sentences were manifestly excessive . 29 The applicant contended that the overall sentence of 8 years with a single non-parole period of 5 years was manifestly excessive, particularly in light of the total monetary value of the fraud. No complaint is made about any of the individual sentences. Particular reliance was placed upon the decision of this Court in R v Pipes [2004] NSWCCA 351 and Gok v R [2010] WASCA 185, a decision of the Court of Appeal of Western Australia, to support this submission. Sentencing statistics from the Judicial Commission of New South Wales were provided to the Court. 30 In Pipes the applicant pleaded guilty to one count of obtaining a financial advantage by deception under s 134.2 of the Criminal Code Act. The maximum penalty for an offence contrary to s 134.2 is 10 years imprisonment (as is an offence contrary to s 134.1). The applicant's duties, as an employee of the Department of Veterans' Affairs, included making decisions as to whether ex-military servicemen and women were entitled to be paid incapacity payments on account of being injured while on service. He diverted 20 payments totalling $155,644 to his own benefit. He pleaded guilty at the earliest opportunity and repaid the money taken. He was contrite and remorseful. The applicant was sentenced to 3 years imprisonment to be released after serving 2 years upon entering into a recognisance to be of good behaviour. The applicant's appeal against sentence was dismissed. 31 In Gok the appellant was convicted by a jury of two counts of obtaining a financial advantage by deception, contrary to s 134.2(1) of the Criminal Code Act. He was an employee of the Australia Taxation Office (ATO) who created two fraudulent business activity statements within the ATO's computer system which resulted in GST refunds totalling $184,916 to his half-siblings. He received the benefit of a moderate amount of this money. He was sentenced to 3 years imprisonment on each charge to be served concurrently and to be released after serving 2 years on a good behaviour recognisance. The appellant's severity appeal was dismissed, as was the Crown appeal contending that the sentences were manifestly inadequate. 32 Both counsel referred to a number of other cases dealing with sentences imposed for frauds on the revenue, which included R v Knight [2004] NSWCCA 145; Ly v R [2007] NSWCCA 28; Sanchet v Director Public Prosecutions (Cth) [2006] NSWCCA 291 and there was argument about matters of distinction. 33 To establish this ground of appeal, the applicant must demonstrate that the sentence was manifestly excessive in the sense of being unreasonable or plainly unjust: Markarian v R (2005) 228 CLR 357. Each case must be considered in the light of its own facts. No two cases are the same and there is no single correct sentence: Pearce v R (1998) 194 CLR 610. Section 16A(1) Crimes Act obliged the Judge to impose a sentence that is of a "severity appropriate in all the circumstances of the offence." 34 The amount of money that the applicant dishonestly obtained is undoubtedly a significant matter in assessing the objective seriousness of the offences: R v Hawkins (1989) 45 A Crim R 430 at 435. As Mr Nash correctly pointed out, the total amount of the applicant's fraud being $156,034.50 is less than amounts involved in some of what are said to be comparative cases. The gravity of the applicant's offending does not, however, depend only on the amount taken. There are a number of other factors which when considered in combination justify an assessment that the criminality involved in the offences was of a high order. 35 The applicant was a senior employee of Medicare whose duties and functions as the Manager of the Shellharbour branch were detailed by the Judge in his sentencing remarks. Her responsibilities required oversight of the integrity of the Medicare payments made within the branch and to ensure compliance with Medicare policies. In abusing the trust that had been reposed in her, she used an intimate knowledge of Medicare's systems to carry out the frauds between 1 June 2002 and 7 February 2007. It is essential to the operation of Medicare that employees entrusted with managerial responsibilities perform their duties honestly and not use senior positions for their own fraudulent advantage. 36 Furthermore, the applicant's offending included the creation and use of 65 false identities, false invoices, dishonest handwritten notations and some 387 fraudulent transactions. This was a persistent and sagacious fraud committed over a period of 4 years and 8 months. The abuse of trust, the sophistication and planning, the difficulties of detection and the significant period over which the frauds were committed all add to the gravity of the offences. General deterrence is an important element of sentencing for such offences: Hawkins at 435; R v O'Keefe (1992) 60 A Crim R 201; R v Pont [2000] NSWCCA 419. 37 There are clear matters of difference from the facts in Pipes and Gok and the cases cited to the Court by the parties. In my view, the sentence imposed was within the legitimate exercise of his Honour's sentencing discretion. I am not persuaded that the overall sentence is manifestly excessive. I would reject this ground of appeal. 38 Accordingly, the orders I propose are:

(i) Leave to appeal granted. (ii) Appeal dismissed.

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Crimes Act 1914(Cth)s 16A(1), s

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