Daniel Albert is to be sentenced for 32 counts of dishonestly obtaining a financial advantage contrary to s 192E(1)(b) of the Crimes Act 1900. The maximum penalty for each of those offences is ten years imprisonment and no standard non-parole period applies. Pleas of guilty were entered at Central Local Court on 11 October 2018 and it is accepted, therefore, that the offender is entitled to a discount of 25%.
The offences were committed between September 2011 and April 2016 via four different businesses operated by the offender: those being Glamour Nail, Identical You, Switched on Social, and First Aerial. The offences involve a total of about $4,324,570, which was received from 32 victims.
I intend to impose an aggregate sentence in this matter which I will announce at the end of my remarks. I will, however, as I am required to, indicate the sentences that I would have given with respect to each offence as I deal with the facts relating to that offence. I will then announce the overall aggregate sentence and non-parole period at the end.
Dealing first with the Glamour Nail offences. This business commenced in about September 2011 when the offender and his partner, Kelly Hanna, registered with ASIC the name Glamour Nail Australia Pty Limited. In conducting the business the offender used the name, Daniel Hanna. It was through an internet website that the offender marketed a product which was claimed to be a fully automated nail, that is, fingernail, art vending machine. The business had the appearance of a legitimate enterprise and lawyers were engaged to draw up contracts, office space was obtained and staff were employed. The business was advertised to a national and international market until it ceased trading in 2013. Staff were trained to deal with online inquiries using scripts prepared by the offender which contained a number of false representations. After contact was made by an interested person staff would forward promotional material which itself contained false representations. Once a sale was made and monies received, staff would cease communications with the purchaser and/or subsequent inquiries were directed to the offender.
R v Albert [2019] NSWDC 869 | Case summary | Zoe
Between December 2011 and January 2013 the Glamour Nail business received a total of $2,916,370 from investors. I note that these matters are the subject of the agreed Statement of Facts from which I am summarising. The automated machine as promoted by the business, however, did not exist.
On 13 November 2011 the business issued a press release on franchise websites that included the following:
"Glamour Nail today announced a number of highly anticipated improvements for its unique nail art vending machine with the introduction of a new print system. Nail art can now be applied in only ten seconds. Mrs Hanna, a director of the company, said this is a huge improvement and has numerous benefits for our users and operators. We have also completely redesigned and updated our touchscreen interface which makes the process very straightforward for users. Also, users can now pay with coins and notes and receive change. In development is the ability to pay with credit cards and accept the new touch and go payment cards. We are also looking at a remote monitoring solution so that you can watch your machine from any internet enabled device and receive email or SMS alerts where necessary."
The press release went on to include references to this being the only vending machine of its type in the world, that the quality of images and photos printed onto nails is amazing and quoted seven reasons that made the Glamour Nail Kiosk so popular:
"1. That it's the world's only nail art vending machine.
2. That it's easy and fun to use.
3. That it takes less than a minute per nail.
4. That over 1,000 designs are available to choose from.
5. That it is a fantastic looking machine which draws attention.
6. That you can watch the whole process in real time on the touchscreen display, and
7. That it is compact so it can be installed in small or large locations."
Among the representations made by the offender and his partner in this business were that Glamour Nail was trademarked and that the machine it sold was the subject of a worldwide patent. Neither of these representations were true.
There was at this time an existing nail art vending machine which had been patented in 2001 by a person in Korea. That machine, however, was not automated and required a user to go through a number of manual processes in order to produce a finished result.
In late 2011 the offender travelled to Seoul in Korea and the Glamour Nail business purchased a number of older non-automated nail machines from a company in Korea.
Between September 2011 and May 2012 Glamour Nail made payments totalling almost $216,000 to the Korean company. This older model was presented to prospective customers as a prototype machine, a fully automated version of which was claimed to be in production. This was false. No manufacturing of an automated vending machine was ever undertaken.
In early 2012 Glamour Nail hired a Mr Mullens, as its technical manager, and he held some preliminary discussions with other businesses with regard to after sale service, although no formal agreement was ever entered. Mr Mullens also travelled to Korea where he had discussions aimed at having the Korean manufacturers improve the existing machine and produce a new model. Also in 2012 Mr Mullens approached another business called Net Card and discussions occurred about incorporating remote monitoring and cashless payment systems into a machine to be manufactured in Korea.
Further meetings occurred in Thailand in May 2012 which were also attended by the offender relating to the purported development of machines and payment devices to be incorporated into them. According to Mr Mullens, however, no agreement was ever reached with any Korean manufacturer to either develop or to manufacture an automated machine. Subsequently, the Net Card company assisted by another company called Arbor Australia Pty Limited were engaged to do product development including a new design, shape, software and manufacturing in Australia.
Between March and December 2012 Glamour Nail paid Net Card a total of about $648,295. However, as at June 2013 the company still owed Net Card more than $400,000.
The work done by Net Card and Arbor led to the production of 30 demonstration models which were, in effect, empty shells to show what the automated machine would look like. However, the technology to permit the automatic application of nail polish was still in the research phase. The offender and his partner sent photographs of the demonstration models to customers who were awaiting machines saying that these were photographs of the Glamour Nail factory where the machines were being manufactured. This was false.
The offender and his partner continued to sell the non-existent machines and distribution rights for them until the business ceased trading in October 2013 when a liquidator was appointed.
During the course of the business in most cases victims paid deposits of 50% of the total cost of the machines and distribution rights. However, some victims paid in full for machines and distribution rights that they never received.
Turning then to the specific offences relating to the Glamour Nail business, of which there are 22 in total.
The offence described in sequence 2 relates to a victim by the name of Anne Tompsett, who in December 2011 made contact with the offender after searching for business opportunities on the internet. The offender sent her emails representing that Glamour Nail had no competitors and had patents in several countries. Ms Thompsett subsequently paid a total of $64,350 in January and February 2012 being funds borrowed from her parents, which she later converted to a business loan from the Commonwealth Bank. Although she was told throughout 2012 that the machines would be arriving soon, they never did, and apart from some loan repayments made on her behalf by the offender, she received none of her investment funds back. The indicative sentence in relation to that offence is one of two years imprisonment.
Sequence 3 relates to a Mr Skakeel Maredia of Humble, Texas, who also found Glamour Nail while searching the internet for business opportunities. After making contact with employees of Glamour Nail Mr Maredia paid into the Glamour Nail bank account the equivalent of $92,921 in January 2013. Mr Maredia received no machines and received none of his investment back. The indicative sentence is two years and two months.
Sequence 4 relates to Mr Bradley Scapens, who apparently lived in Western Australia. Mr Scapens was told about Glamour Nail by a friend and spoke with the offender who told him that the company had written agreements with all the big shopping centres in Western Australia and the machines could be operated there with great profits. The offender further told him that if he invested quickly his machines would be delivered within six weeks. In March 2012 Mr Scapens paid $205,000 to Glamour Nail. Despite various promises Mr Scapens received no machines and no refund. I indicate a sentence for that offence of three years imprisonment.
Sequence 5 relates to Ms Tracy Mersch of Lincoln, Nebraska. She was told by the offender and his partner that she would receive distribution rights to ten machines in Nebraska. Ms Mersch travelled to Byron Bay in April 2012 to participate in training and was told that her machines would arrive in June. She paid the equivalent of $97,815 which apparently represented the life savings of herself and her husband. She received no machines and lost the entirety of her investment. I indicate a sentence of two years and two months.
Sequence 6 relates to Michael Enevoldsen and his wife, Megan Barnes, who after discussions with the offender entered a purchase agreement for distribution rights of the machines in New South Wales and the ACT which included 34 machines. In May 2012 they paid $125,000 but received no machines nor any refund. The indicative sentence is two years and six months.
Sequence 7 relates to Ms Ama Tabet of Lebanon. Ms Tabet paid a total of $46,387 deposit between April and May 2012 after finding the Glamour Nail website and speaking with a Glamour Nail employee at the Dubai Trade Fair. She entered a purchase agreement which purported to grant her distribution rights for Lebanon as well as five machines. However, she received no machines nor any refund. The indicative sentence is one year and six months.
Sequence 8 involved Mr Phillip Le Page of Missouri. In May to June 2012 he paid a total of $59,192, after finding the website and making arrangements to meet the offender at a trade show in Las Vegas. He also attended a training session in Kansas City where he and others were shown a picture of some fingernail art which was said to have been made by the new machine. Mr Le Page received no machines nor any refund. The indicative sentence is two years.
Sequence 9 relates to Cherif Tabet of Lebanon who is the brother of Ama Tabet to whom I've just referred in relation to sequence 7. He paid a deposit of $129,678 between June and September 2012 after attending the Dubai Trade Fair and entering into an agreement that purported to grant him distribution rights for the United Arab Emirates as well as ten machines. Despite receiving various promises, Mr Tabet received no machines or any refund of his money. The indicative sentence is two years six months.
Sequence 10 relates to Ms Leigh Anne Whyte, who was another investor who located Glamour Nail on the internet. Acting on representations made to her Ms Whyte entered an agreement in July 2012 to purchase what purported to be the exclusive distribution rights for Hong Kong. She paid an amount of $206,151.00 to Glamour Nail. She also attended a training session in Kansas City in August 2012 which was conducted by the offender and an associate. Ms White moved to Hong Kong in September 2012 to start the Glamour Nail business where she incurred an additional $20,000 in business set up fees. Despite promises that machines would eventually be delivered, no machines arrived and none of her monies were refunded. The indicative sentence is three years.
Sequence 11 relates to Ms Rajani Girish of Houston Texas who paid the equivalent of $140,810 in October and December 2012 which purported to give her exclusive distribution rights for San Antonio and Austin Texas. She also attended a training day in Houston Texas in February 2013. Despite promises, she received no machines nor any refund of her money which represented the entirety of her family's savings. The indicative sentence is two years seven months.
Sequence 13 relates to Mr Jim Shugart of Leawood, Kansas. He paid a total of $97,115.00 in August 2012 after receiving representations from the offender or his staff which promoted the profitability of the Glamour Nail machines which were described as being fully developed, tried, tested and proven. Mr Shugart entered an agreement which purported to give him distribution rights for Kansas as well as seven machines. He of course received no machines nor any refund of his investment which represented about 90 per cent of his retirement savings. The indicative sentence is two years, two months.
Sequence 14 relates to Mr Koray Baysal of Ohio who paid a deposit of $113,913.00 after attending a training course in Kansas City in August 2012. Like other investors he was told that the machines would be shipped to him, however, no machines arrived and he received none of his investment back. The indicative sentence is two years, four months.
Sequence 15 relates to Mr Adrian Chan of Singapore who like many other investors found the Glamour Nail website while searching for business opportunities on the internet and subsequently attended training in Kansas City. In October 2012 he also attended the Byron Bay office of Glamour Nail where he was shown a mock up machine. Mr Chan paid a total of $69,577 to Glamour Nail but received no machines nor any of his money back. The indicative sentence is two years.
Sequence 16 relates to Mr Greg Brutofsky of New Jersey who was promised exclusive distribution rights for New Jersey and the supply of 24 machines. He also received a type of demonstration machine. Between October and November 2012 he paid to Glamour Nail a total of $435,669, part of which was provided by a second investor. He however received no machines nor any refund and took it upon himself to pay back the money provided by the second investor. The indicative sentence is three years nine months.
Sequence 17 relates to Ms Jill Plough of Evansville Indiana who paid the equivalent of $41,687.00 in September 2012 after attending Glamour Nail training in Kansas City and being told that the machines were "fully developed, tried, tested and proven". The machines of course did not exist and Ms Plough received none of her money back. The indicative sentence is one year six months.
Sequence 18 relates to Ms Debbie Ann Clarke who invested $119,600 in Glamour Nail after receiving various false representations including a fraudulent brochure which purported to show one of the non-existent machines located in a shopping mall and which stated that the machine was "fully patented worldwide". Ms Clarke also travelled to Byron Bay in October 2012 where she met the offender who made other false representations to her. In April and May 2013 Ms Clarke had further conversations with the offender in which he again told her lies about the Glamour Nail machines. She received no money in refund nor any machines. The indicative sentence is two years, six months.
Sequence 19 relates to Mr Anthony Lloyd who invested in Glamour Nail after seeing an advertisement for it in December 2011. Subsequently he spoke with the offender and was offered the master distributorship for South Australia to which he agreed. Mr Lloyd paid various sums to Glamour Nail and began advertising the machines in South Australia and also attending training in Byron Bay. Although an amount of about $22,000 was repaid to Mr Lloyd by the offender, the balance of his investment amounting to $84,700 was never received back nor where there any machines delivered. The indicative sentence is two years, two months.
Sequence 20 relates to Ms Elie Jubran of Qatar who also located Glamour Nail via its website and later spoke with one of the offender's staff. She entered into an agreement which purported to give her exclusive distribution rights for Qatar as well as five machines. She also attended training in Orlando Florida in November 2012, however, no machines were ever received and her investment of $70,316 was lost. Indicative sentence is two years.
Sequence 21 relates to Daniel Hoy and his wife who met the offender and some of his employees in Byron Bay after being attracted to the Glamour Nail website. They were told by the offender that the machine was patented and that machines would be delivered by September 2012. The Hoy's entered an agreement which purported to provide distribution rights for Victoria and Tasmania as well as 15 actual machines. After borrowing $80,000 against the value of their home the Hoy's invested $100,000 and took out a lease on an office in Melbourne based on the anticipated delivery of a sample machine. Although they received a demonstration machine the promised final working machines never arrived. While the offender paid the cost of their leased premises for a period of two months the Hoy's never received any refund of their $100,000 investment and were forced to sell their home to pay off the $80,000 loan. The indicative sentence is two years, three months.
Sequence 22 relates to Ms Karen Kurtz of Jefferson Texas, she also learned of Glamour Nail through the internet. In October 2012 she spoke with the offender by telephone who told her that the machines are "The only one of this kind in the world" and that the machine had a proven history and "Pays for itself in about three months or so". She was also falsely told that machines were currently being shipped to Texas. She attended a training session in Orlando and in October and November 2012 Ms Kurtz paid a total of $107,897 to Glamour Nail which represented her life savings. She received no machines nor did she recoup any of her investment. The indicative sentence is two years, three months.
Sequence 23 relates to Mr Hamish Baird of Belfast, Ireland, who paid to Glamour Nail the equivalent of $390,588 after being given numerous representations about the Glamour Nail business and its machines. Mr Baird met the offender at his Byron Bay offices and was told among other things that there were many existing machines available for distribution which accepted coins, notes and credit card payments and were protected by patent. He was also told that the "Sales were pouring in from Dubai and all over the world" and that sample machines would be waiting for him when he returned home from Spain where he would receive some training. Mr Baird also attended a promotion which the offender gave at a trade expo in Las Vegas in June 2012. Mr Baird signed a letter of agreement which purported to give him exclusive distribution rights to the machines in the United Kingdom. Although Mr Baird received one demonstration model he received no finished machines and commenced civil proceedings in Australia seeking to recover his monies. In July 2015 the offender and one of his associates signed Court Orders agreeing to repay $575,000. However, no funds were repaid and in December 2015 the offender left Australia and then travelled to New Zealand. The indicative sentence for that sequence 23 offence is three years, six months.
Sequence 24 relates to Mr William Hoiles who paid $118,000 to Glamour Nail in September 2012 after being promised the distribution rights for New Zealand. Mr Hoiles also attended training at Byron Bay in October 20-12 which was conducted by the offender. Despite being given various explanations for delays Mr Holes received no machines nor any refund of his investment. The indicative sentence is two years, six months.
I turn then to the offences relating to the business "Identical You", of which there are six specific offences. Another of the offender's businesses used this name, Identical You, which was registered with ASIC in May 2014 and which was conducted by the offender using the name Daniel Erefor and by a co accused named Daniel Di Domenico. This business was advertised on the internet as a franchise opportunity that would be launched in August 2014. The company claimed to have exclusive rights to technology capable of printing high resolution photographs in 3D. It also claimed to possess 3D printers capable of producing high quality figurines. The company encouraged potential investors to enter fulfilment partnerships through which they would receive exclusive rights to use the technology in certain areas, as well as supplies of equipment, advertising help and other support.
The offender set up an office in Sydney and employed a small number of staff. Investors were invited to meetings with the offender and his staff and a number of investors were shown professional looking brochures and other advertising material. Between May and October 2014 the "Identical You" business received a total of $791,600 from investors. However, none of the promised technology, supplies or support were ever delivered. It was appropriately conceded by counsel for the offender that there is no evidence that the offender or Mr Di Domenico possessed such technology so as to be able to offer it to the victims. It was also conceded that it would be open to the Court to find that the motivation for these offences was greed. The following sequences relate to offences involving the "Identical You" business.
Sequence 26 relates to Ms Zillay Batool who after registering an interest in the company was contacted by the offender using the name Daniel Erefor and describing himself as the CEO of the company. In May 2014 Ms Batool travelled to Sydney where she met the offender and the co-accused Mr Daniel Di Domenico and was shown some 3D figurines that were said to have been printed by the company's 3D scanners. She signed an agreement which purported to give her partnership rights in parts of Sydney in exchange for which she paid $196,900. However, she received nothing, and lost all of her funds. The indicative sentence is two years, ten months.
Sequence 1 relates to Mr Arik Bennett and his wife who were also attracted to the "Identical You" business by representations on the internet. Mr Bennett was contacted by the offender who again using the name Daniel Erefor described himself as the director. Based on representations by the offender and his staff Mr Bennett entered an agreement which purported to cover the North Sydney area and paid a total of $247,500 from about June 2014. However, Mr Bennett receiving nothing and lost all of these funds part of which were obtained using a business loan. The indicative sentence is three years, three months.
Sequence 27 relates to Mr Alan Landau who registered an interest in the "Identical You" company in about May 2014 and was contacted by the offender again using the name Daniel Erefor and describing himself as the CEO. Mr Landau and his son travelled to Sydney where they met the offender and co-accused Di Domenico at the "Identical You" office. They were given various representations by the offender and were also told that the machines were "On the water" and would arrive soon. In June 2014 Mr Landau paid $49,225 which he never saw again and for which he received no machines. The indicative sentence is one year six months.
Sequence 28 relates to Mr Michael Kwee who met the offender in July 2014 when he signed what purported to be a franchise agreement with "Identical You" for three different parts of Melbourne. After paying a deposit of $125,000, Mr Kwee became concerned that the business was fraudulent and instructed his bank to stop the transfer of that money. However, the bank failed to act on his instructions and despite several misrepresentations by the offender Mr Kwee recovered none of his funds and received nothing in return for them. The indicative sentence is two years, six months.
Sequence 29 relates to Mr Martin Spears who registered an interest in the company in July 2014 and was contacted by the offender using the name Daniel Erefor and again describing himself as CEO. Mr Spears travelled to Sydney where he met the offender and co-accused Di Domenico. Based on representations made to him Mr Spears entered into an agreement which purported to give him franchise rights in East Melbourne for which he paid a deposit of $123,750 which he never saw again despite various promises made by the offender. The indicative sentence is two years, six months.
Sequence 30 relates to Mr Ricky Spinks who also learnt of the "Identical You" business through the internet and in July 2014 Mr Spinks and his wife attended a presentation in Sydney where they met the offender. Mr Spinks subsequently entered an agreement which purported to give him distribution rights for Melbourne West and Geelong at an agreed price of $98,450. Mr Spinks paid a deposit by cheque of $49,225 which he handed to the offender. Despite various false promises he received nothing and received no refund of his investment. The indicative sentence is one year, six months.
Another fake business conducted by the offender was called "Switched on Social". This business was commenced by the offender using the name Daniel Faron and another person during 2015. The company claimed to manage social media accounts for clients by providing various services including marketing and advertising, video production, web design, copy writers, social media influencers and systems engineers. The offender hired a person as Chief Technical Officer who was paid just over $10,000 for his work. It was conceded by counsel for the offender that there is no evidence of the offender's ability to supply the promised services and that the Court would be entitled to conclude that whatever money was left after paying the Chief Technical Officer was taken by the offender.
The offence in sequence 31 relates to this business. That offence concerns a victim by the name of Benjamin Little, who after finding the "Switched on Social" company on the internet spoke with the offender by telephone on a number of occasions and in August 2015 met with the offender in Sydney and entered into a franchise agreement. Mr Little and the offender walked to a bank in Sydney where Mr Little withdrew $80,000 from his account which he then deposited into the account for "Switched on Social". He later paid a further $14,000 to the company. However, after ongoing contact with the offender and being given various excuses, contact with the offender ceased and Mr Little's deposit was never returned. The indicative sentence is two years, two months.
On 5 December 2015 the offender left Australia and went to New Zealand where he was arrested for offences committed there in 2007 and granted bail. Notwithstanding this, the offender continued to offend via a fourth business. The fourth fraudulent business through which the offender perpetrated his crimes was called "First Aerial" which the offender started promoting in late 2015. In this business the offender used the name Mark Parker. The company was marketed as a national network for the sale of aerial drones and associated training.
It claimed to supply a range of services including commercial drones, licensing and training in the use of drones and maintenance and support. The business's marketing included detailed brochures with hundreds of pages, as well as maps of purported licence areas and official looking aviation reference numbers said to have been issued by the Australian Government. It was conceded by counsel for the offender that there is no evidence that the offender had the ability to provide the advertised goods and services and that it is open for the Court to conclude that the motivation for the offences was greed. The following sequences relate to the First Aerial offences.
Sequence 33 concerns Mr Donovan Newton who made an on-line enquiry about the company in November 2015 after which he was contacted by a woman calling herself Scarlett Parker. In January 2016 Mr Newton spoke with the offender who was using the name Mark Parker and they agreed to meet. Subsequently Mr Newton paid a total of $217,800 to the offender's company, however he received none of the promised services and recovered none of his investment. The indicative sentence is three years two months.
Sequence 32 relates to Mr Zygmunt Jackowski who made an on-line enquiry about the company in March 2016 and subsequently spoke with the offender about a sophisticated drone said to have been made in Germany and training and licensing to use the drone in the ACT. Following representations by the offender, including the suggestion that Mr Jackowski would soon be earning at least 15 to 30 thousand dollars per month, he invested a total $154,800 after telling the offender he was in the process of cashing in his superannuation as a lump sum to fund the investment. After receiving various, no doubt false excuses, Mr Jackowski heard nothing more from the offender and recovered none of his money which represented the entirety of a lump sum he had received from his superannuation. The indicative sentence is two years eight months.
Sequence 32 relates to Mr Martin Forsyth who in April 2016 discovered First Aerial while looking for business opportunities on the Internet. After registering his interest on line he was contacted by a woman calling herself Scarlett Parker and later spoke to the offender who was using the alias Mark Parker. After discussions Mr Forsyth paid a total of $150,000 for what he was told would be marketing rights for the northern part of Western Australia. Although the offender later agreed to refund $100,000 of this money, Mr Forsyth in fact received nothing in return for his $150,000 investment, nor any refund of that investment. The indicative sentence is two years, seven months.
The objective seriousness of these offences that I have described is demonstrated by a number of factors. Firstly the maximum penalty of ten years to which I am required to have regard as a guidepost in the sentencing exercise. Secondly in terms of objective seriousness, it is relevant that each of the 32 offences involved large sums of money, ranging from $46,000 approximately to over $400,000 and totalling in excess of 4 million dollars.
Thirdly, I note that the offending continued over a very substantial period of time being about four and a half years. I regard each of the offences as involving a high degree of objective criminality. Also in my opinion the offences are aggravated because they were motivated by greed. While there is some limited evidence of a gambling addiction, this is not a factor which mitigates the offending which continued over a number of years. In these circumstances the offenders continued engagement in gambling over that time and his failure to seek treatment for it must be regarded as a choice rather than a need.
It was argued in relation to the Glamour Nail offences that this was not a sham business carried on for sheer greed and that the offender was genuinely trying to get an automated machine built. The offender pointed to the large sums of money paid by the company to the Touch Mate and Arbor companies, and attempts made by members of his staff to improve the existing machine and produce a new model. In the absence of evidence from the offender, I am not able to determine if these were genuine attempts at the production of the promised machines, or were merely a front intended to give the business an air of legitimacy.
While I am not satisfied on the balance of probabilities that these offences are mitigated by a genuine intention to produce an automated machine, neither am I satisfied beyond reasonable doubt that the offences are aggravated because the business was an intentional sham from the outset. In the circumstances I have made my assessment of the seriousness of each of the Glamour Nail offences based on the agreed facts which I have set out in summary form earlier. Although each of the offences involved slight differences in the content of the false representations, the common element was the representation that an automated machine had already been developed and would be supplied to the victim. These representations were blatantly untrue and were made, as I have concluded, out of a greedy desire to fleece the victims of their funds.
Furthermore, the victims were not, as is sometimes the case in large scale frauds, large and profitable commercial enterprises with deep pockets. Rather the money was taken from individual victims with aspirations it seems to establish a small business. Some of the victims incurred very significant losses, such as losing superannuation, life savings, or being forced to sell a family home. However the Court can only have regard to the consequences of an offence that were intended or could reasonably been foreseen by the offender. I have therefore not had regard to the extreme consequences such as those that I have mentioned, which I am not satisfied the offender could reasonably have foreseen. There is one exception to this and that is the offence in sequence 34 relating to Mr Jackowski who told the offender that he was cashing in his superannuation in order to make his investment.
Having said these things, the nature of the businesses marketed by the offender were in my opinion aimed at an audience likely to involve relatively small time investors, many of whom were likely to have limited funds and limited business experience. It is notable that the offender dealt personally with most of the victims and prepared scripts for his staff to use in enticing them. In the circumstances I am satisfied that the offender must have known that most, if not all the investors were likely to suffer significant hardship by his fraudulent actions.
In addition, the offences involved a high degree of planning and sophistication, such as registering company names, advertising, recruiting and paying staff, preparing scripts for use by staff, preparing presentations to potential investors, printing brochures, producing prototype machines and using false names. I accept also as was conceded by the offender that the First Aerial offences are aggravated because these were committed while the offender was on bail in New Zealand for earlier fraud offences committed by him in that country.
The offender's prior criminal history is fairly limited and consists of one matter of dishonesty in 2004 for which he was given a Community Service Order in the Local Court and some offences in New Zealand in 2007 for which he was imprisoned there after committing the offences for which I must sentence him. In addition to the offender's criminal history, it was argued by the Crown that I should give greater weight in this case to deterrence and protection of the community because of the prior conduct tending to demonstrate the continuing attitude of disobedience to the law. In this submission the Crown sought to invoke the principles set out by the High Court of Australia in Veen v R (No 2) (1988) 164 CLR 465. This prior conduct was placed before me in an agreed fact document which notes that in 2005 the offender was placed by ASIC on its banned and disqualified register for three years and that in 2006 the Federal Court made a finding that the offender had contravened the Trade Practices Act 1974 by making false or misleading representations.
The prior conduct relied upon however is not, as in Veen, criminal offences for which the offender has been convicted, but rather involves civil findings or penalties. In these circumstances, while I have had regard to this material and the offender's prior offences as matters which reduce his entitlement to leniency, I do not consider that the principles in Veen No 2 are invoked.
The offender's subjective case is set out in the report of the psychologist Dr Mark Milich. He is 53 years old, he was born in England and has an older brother. His early years were marred by distress due to fights between his parents who separated when he was about seven. His father emigrated to Australia and the offender was sent to boarding school in England and described a stark home environment and difficulty arising from his father's departure. When he was a little older the offender visited Australia and was reunited with his father. While he became very attached to his father the father was someone who operated on the fringes of legality and associated with persons of questionable character. This apparently led to the offender entering a relationship with the daughter of Abe Saffron with whom he fathered a daughter who is now about 29 years of age.
The offender told the psychologist that he had a history of problems with gambling, illicit drugs, alcohol and out of control moods. The offender claimed that he gambled heavily on poker machines and sometimes roulette and estimated that he had lost over one million dollars in gambling which only stopped when he was imprisoned in New Zealand in 2015. He described a history of heavy alcohol and drug usage. He apparently suffered a heart attack about 11 years ago and in recent years had dramatically reduced his alcohol consumption which he said had benefitted him immensely.
The offender has been with his current partner for about 11 years. He told the psychologist that she had been hurt by his offences and incarceration and had warned him that she would leave him if he offended again. The offender claims he has sworn to his partner that in the future he would get a normal job and that prison had taught him to lead a simpler life. The offender described his period in custody after extradition to Australia as stressful, especially due to his concerns about his safety after he was wrongly labelled as an informer. He told the psychologist that in more recent times he has spent spare time writing a journal which had helped him reflect on his offences and he realised that in the past he had lacked a moral compass and had minimised the seriousness of his offending. He claimed to the psychologist that he now realises how destructive his offences were and that upon release he intends to live a quiet life and get a normal job perhaps in a rural location.
The psychologist considered that the offender gave a psychologically plausible account of his history and concluded that he had experienced an emotionally disadvantaged childhood and adolescence which left him psychologically damaged and susceptible to mental health problems. The psychologist concluded that as a result of this background the offender was driven by a chronic need to feed his addictions and a desperate need for success to compensate for a deep seated sense of inadequacy. The psychologist concluded that the offender's experiences in prison, his mature reflection on his offences and his plans to live a simpler life when released are positive factors for his rehabilitation.
The Court has also received a letter from the offender in which he says that he takes full responsibility for his crimes. He describes his upbringing as having shaped and normalised his behaviours and his perception of right and wrong. He claims that since being incarcerated he has been confronted with the enormity of his actions and their effects on victims and on his own daughter and family. He claims to have insight into what it must be like to be an investor who has placed trust in someone only to be defrauded and for this he says he is genuinely sorry. He says he now understands how his actions have hurt people. He confirms that while in prison remand his father passed away and expresses his distress at not having been able to see or spend time with him or attend his funeral. He expresses regret for his actions and that his time in gaol has taught him if possible to lead a simpler and quieter life and to be a good father. He assures the Court that he will never offend again.
I have had regard to the matters contained in the psychologist's report and the offender's letter to the Court, however there is nothing in that material which provides any meaningful explanation for or any significant mitigation of the serious nature of the offences. In my opinion the offending involves a very high degree of moral culpability. Based on the offender's letter and what he told the psychologist I do however accept that there is some evidence of remorse although the weight that I give to this is reduced because it relies entirely on the offender's self-report which was not supported by evidence on oath. Given the seriousness and premeditated nature of Mr Albert's offences, the period over which they were committed and his prior conduct I am unable to conclude that his prospects of rehabilitation are good.
Clearly these are offences which call for significant punishment. As has been stated by Courts many times the need for deterrence both for the individual offender and of others is of great importance with offences of this kind. In determining the appropriate sentence I have had regard to the purposes of sentencing set out in s 3A of the Crimes (Sentencing Procedure) Act 1999. I am satisfied that no sentence other than full time imprisonment is appropriate and indeed no submission was made to the contrary. As I indicated earlier I intend to impose an aggregate sentence. Had I not done so then the sentences that I would have imposed for each of the offences are those that I have already indicated.
I have had regard to the principle of totality in determining the overall aggregate sentence and in a matter of this kind there would have been a need for a significant degree of concurrency, although also a degree of accumulation so as to avoid the imposition of a crushing sentence but also to select a sentence which nonetheless reflects the overall criminality involved in these offences. I intend to find, and I have found, special circumstances for varying to some degree the ordinary ratio between head sentence and non-parole period. I make that finding due to the importance of the offender being subject to a slightly extended period of supervision on parole so as to monitor his reintegration into the community given his gambling, drug and alcohol issues.
I convict the offender for each offence. I impose an aggregate sentence of 10 years imprisonment and a non-parole period of six years and nine months. Each of those will date from 30 October 2017 being the date on which the offender was taken into custody on these offences in New Zealand. The head sentence will expire on 29 October 2027 and the non-parole period will expire on 29 July 2024 when the offender will be eligible for consideration to be released on parole.
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Decision last updated: 21 April 2020