The Offender appears before the court for sentencing in relation to a number of charges, having pleaded guilty to the charges on the Crown Sentence Summary (Exhibit A). The two charges to which the Offender pleaded guilty are:
1. that between 29 November 2012 and 2 June 2014 in Sydney in the State of New South Wales, the Offender did deal with money or property that was and that he believed to be proceeds of crime. At the time of the dealing, the value of the money or property was $50,000 or more, namely $51,692.97 in breach of s 400.5(1) of The Criminal Code (Commonwealth); and
2. that between 7 March 2013 and 20 May 2014 at Sydney in the State of New South Wales the Offender did by a deception dishonestly obtain a financial advantage from the Commonwealth by causing to be lodged with the ATO sixteen income tax returns for the tax period 1 July 2012 to 30 June 2013, which falsely claimed tax refunds in the total sum of $22,475.18.
[2]
Guideposts
The maximum penalty represents the legislature's assessment of the seriousness of the offence. In exercising its sentencing discretion the court must always arrived at an outcome that is just in all the circumstances. The following sentences apply to the offences for which the Offender has pleaded guilty and is today to be sentenced:
1. for the first offence, previously described, the maximum period of imprisonment is 15 years;
2. for the second offence, previously described, the maximum period of imprisonment is ten years.
There is also a s16BA matter that the Offender has requested that, in sentencing on the principal charges, the Court take into account those further offences for which the Offender has been charged but not convicted. The Offender has admitted guilt in relation to those offences.
The charges on the s16BA schedule are to be taken into account with a view to increasing the penalty that would otherwise be appropriate for the principle offences to which the s16BA form attaches. 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. The second is the community's entitlement to extract retribution for serious offences.
The additional charge is that between about 24 July 2013 and about 26 July 2014, at Sydney in the State of New South Wales the Offender did dishonestly cause a risk of loss to another person namely the Commonwealth, knowing or believing that there was a substantial risk of the loss occurring as a result of causing to be opened nine bank accounts in the name of Benigno Lee into which tax refunds from the lodgement of false income tax returns for the tax periods 1 July 2009 to 30 June 2010, 1 July 2011 to 30 June 2012, 1 July 2012 to 30 June 2013 were paid, in the total sum of $16,814.73. The maximum sentence for that charge is five years. In determining the sentence the charge on the s 16BA form attaches to the second count on the Crown Sentence Summary previously announced.
[3]
History
The principal offending was committed between 29 November 2012 and 2 June 2014. The Offender was arrested and charged on 25 June 2014. On 21 August 2015 the Offender was committed for trial in the District Court. The Offender pleaded guilty to the charges on 13 June 2017, almost three years after he was first charged and arrested. That being so, it was a relatively late stage of the proceedings which of course will be taken into account in determining the value of the guilty plea. The Offender has been on bail for these offences since his arrest.
[4]
Evidence on Sentence
The evidence on sentence from the Crown comprises:
1. the Crown Sentence Summary, and the documents attached thereto (Exhibit A);
2. the Pre-Sentence Report (Exhibit B);
3. Submissions on Sentence (MFI 1); and
4. Table of Comparative Cases (MFI 2).
The Offender relied upon the following material:
1. the Defence Tender Bundle (Exhibit 1), which comprised a report from a psychologist together with a number of character references; and
2. some statistics in relation to sentencing for offences of this type (MFI 3).
Since the sentence hearing I have received additional submissions on behalf of the Offender concerning the new sentencing regime, particularly concerning the availability of an intensive corrections order. Those Further Submissions dated 6 November 2018 will be marked for identification MFI 4.
I also received from the Crown Further Sentencing Submissions in reply to those advanced by the Offender. Those submissions, which are dated 9 November 2018, will be marked for identification MFI 5.
[5]
Agreed Facts
A complete copy of the statement of Agreed Facts will be attached to these remarks on sentence. I direct my associate to provide the Reporting Services Branch with a copy of the Statement of Agreed Facts to facilitate that process.
[6]
Background
This matter arose from an ongoing joint investigation conducted by the Australian Federal Police and the ATO into the use of compromised Tax File Numbers ('TFN's'), to lodge fraudulent Income Tax Returns ('ITR's'), with the Commissioner of Taxation. Subsequent investigations revealed that tax refunds resulting from these fraudulent lodgements were deposited into various third party bank accounts and were quickly withdrawn in cash using various automated teller machines ('ATM's').
On 26 July 2012, the Offender became a registered tax agent, having:
1. obtained a Masters in Accounting and Masters of Business Administration from Central Queensland University; and
2. completed the Certified Practicing Accountants Program (CPA Australia).
In early July 2012, the Offender became a franchisee of the Tax Smart Group ('Tax Smart'). Tax Smart was the national network of approximately 50 franchisees who offered accounting and taxation services to approximately 31,000 individuals and business owners. Between about July 2012 and June 2014 the Offender operated the franchise from Suite 2, at 496 ‑ 498 Anzac Parade, Kingsford, New South Wales. During this time the Offender provided a counselling and taxation services to clients through the Tax Smart network.
[7]
Tax Smart Client Database
The Tax Smart group maintained a centralised database which captured key client information in respect of all of those individuals and entities who had engaged a Tax Smart franchisee to prepare and lodge an income tax return on their behalf. All of Tax Smart's franchisees, including the Offender, had access to Tax Smart's centralised database which contained the details of all existing Tax Smart clients, including their name, contact details and TFN.
All registered tax agents in Australia have access to the ATO's tax agent portal. The Offender had access to that portal on behalf of the Tax Smart group and its clients from 4 July 2012. The portal is a specialised software program that provides tax agents with a broad range of tools and information to manage their client's taxation affairs. This includes the ability to view key financial information in relation to the taxpayer's income, previous year's expenses and tax withheld (PAYG) provided to the ATO by a taxpayer's employer, health care provider or Centrelink.
Using the portal, a tax agent is able to generate a Pre-Filing Report which contains a summary of this third party information in any given income tax year as a basis upon which to prepare and lodge a taxpayer's income tax return. When a tax agent first gains access to the portal, the ATO assigns that individual a unique identifier, known as the Auskey Digital Certificate. On 4 July 2012 the Offender was assigned the unique Auskey Identifier "PBJSSx".
[8]
Search Warrant
On 25 June 2014 at about 6.30am, members of the AFP and ATO attended the Offender's residential premises in Apsley Avenue at Kingsford, for the purposes of executing a search warrant. The residential premises just mentioned is a two story brick premises with entry doors at both the front and the rear. Before gaining access to the premises, the police observed the Offender throw a white package from an upstairs window towards the neighbouring property, that is number 26 of the same address. That package was later retrieved from number 26.
During a search of the Offender's bedroom, the AFP located and seized the following items:
1. an Acer laptop computer linked with the lodgement of false ITR's;
2. printouts containing lists of tax payer information extracted from Tax Smart's centralised client database, including handwritten notations;
3. electronic documents containing lists of taxpayer information extracted from Tax Smart's tax agent portal;
4. hard copy Pre-Filing Reports generated using the Offender's access to the tax agent portal.
5. electronic copies of pre-filing reports generated using the same process;
6. correspondence from various financial institutions in relation to bank accounts held in the name of another;
7. a collection of Yahoo7 email printouts in the name of "ZAHIDSYDNEY00" that recorded the details, that is BSB's, account numbers, contact numbers, user names and passwords and PINs of bank accounts controlled by the Offender; and
8. an electronic log that recorded lodgements made using tax software installed on the ACER laptop computer.
The package thrown from the bedroom window was a red and white plastic satchel with the words "Menz Klub" printed on it. A copy of that satchel is included in the Crown Sentence Bundle (Exhibit A). The package contained a large black folder which in turn housed numerous clear plastic sleeves divided into ten separate pockets, each the size of a business card.
Inside of the black folder, the AFP located:
1. 53 bank cards (The Bank Cards) from 17 different financial institutions in the name of 15 different individuals, none of which were in the name of the Offender, associated with more than 100 bank accounts, with a personal identification number ('PIN') required to use the bank card written on the back, typically in black marker;
2. 16 Australia Post "Load and Go" reloadable pre-paid VISA debit cards purchased from various Australia Post outlets across metropolitan Sydney registered in the name of 16 different individuals, none of which were in the name of the Offender, with the PIN, username and last six digits of the associated mobile telephone number required to use the Load and Go card written on the back; and
3. 21 Vodaphone prepaid SIM cards inside folded Post It notes which contained handwritten details of the mobile phone number, username and PIN of the enclosed SIM card. The majority of the SIM cards were found in the same plastic pocket as a Load and Go card, the SIM cards were used to receive the PIN required to make withdrawals using the Load and Go card.
[9]
Count 1: Dealing with Proceeds of Crime
As set out in the table which will be part of the documents attached to the Remarks on Sentence, between 29 November 2012 and 31 May 2014, 23 tax refunds totalling $51,736.46 were paid into bank accounts that were controlled by the Offender and linked to the bank cards seized during the search warrant. The tax refunds resulted from the lodgement of a false income tax return in the name of each of the tax payers for the income tax year specified in the table below. The table which appears in the Statement of Agreed Facts, I will refer to as Table 1.
Table 1 demonstrated that there were 21 affected taxpayers and use was made of nine false accounts in respect of 23 payments. Records held by the ATO show that:
1. all 21 taxpayers listed in Table 1 had used Tax Smart to lodge an income tax return at some point prior to the fraudulent lodgement giving rise to the tax refund paid to a bank account controlled by the Offender; and
2. the Offender's unique identifier, PBBJSSx was used to access the Tax Agent Portal to generate the relevant pre-filing report in respect of all 23 fraudulent lodgements in Table 1.
Before each false income tax return was lodged, the postal address recorded for the tax payer was changed and the details of the bank account controlled by the Offender were input into the Income Tax Return. Using the 23 tax refunds, paid into the accounts controlled by the Offender, the Offender dealt in the proceeds of crime totalling $51,692.97 comprising,
1. 53 ATM withdrawals in various amounts between $132 and $1770 (typically $1002) totalling $41,311.57; and
2. eight internet banking transfers to other bank accounts within his control totalling $10,381.40.
In each of the eight instances in which the funds were transferred between accounts, the funds were withdrawn at an ATM shortly thereafter. Of the 53 ATM withdrawals:
1. 48 were made from an ATM located on Belmore Road in Randwick;
2. 3 were made at an ATM located in Randwick; and
3. two were made at St George Bank ATM in Kingsford.
[10]
Count 2: False Lodgement of Tax Returns
Between 4 September 2013 and 12 January 2014, the Offender used the ATO's 2013 eTax software program installed on the ACER laptop computer to fraudulently lodge false Income Tax Returns in the name of 16 clients of Tax Smart without their knowledge for the financial year ending 30 June 2013. The Offender used the information he had obtained from the Tax Agent Portal to falsely authenticate himself as each individual taxpayer and lodge an Income Tax Return in their name, using the 2013 eTax software program.
eTax is a software program released by the ATO to assist individual taxpayers to prepare and lodge their income tax return online without the assistance of an accountant or tax agent. A new eTax software program was released by the ATO each income year and could be downloaded from the ATO website. A taxpayer could only use the relevant year's eTax software program to lodge an Income Tax Return for that particular year. The ATO last released eTax software in respect of the income year ending 30 June 2013. Each year's eTax software program would allow a taxpayer to lodge their income tax return online until 31 May of the following year. By way of example, in the 2013 year the program facilitated the online lodgement of Income Tax Returns for the year ending 30 June 2013 up until 31 May 2014. After 31 May, the eTax software could only be used to create an electronic copy of the relevant year's income tax return. To lodge the tax return, the tax payer had to print it out and post it to the ATO.
A forensic analysis performed on the ACER laptop computer located an electronic log on the computer's hard drive that recorded the use of the ATO's 2013 eTax software package. The logs show that the Offender was using the 2013 eTax software program throughout the offence period. In addition to the logs located on the ACER laptop computer, the ATO maintained a centralised audit log of all communications between its systems and any one user of the eTax software program. The centralised audit log captured identity information in relation to the particular computer using the eTax software to lodge an Income Tax Return such as the computer's Mac address, motherboard, manufacturer and serial number. In all, 16 instances of the identity information associated with the ACER laptop computer was captured by the ATO centralised audit log.
The Agreed Facts contain a further table which I will refer to as Table 2. As set out in Table 2, between 16 September 2013 and 22 January 2014, 16 income tax refunds totalling $22,475.18 were paid into bank accounts that were controlled by the Offender and linked to the bankcards seized during the search warrant. The 16 refunds resulted from the lodgement of false 2013 income tax returns by the Offender on behalf of each of the taxpayers on the dates set out in Table 2. For the 2013 tax year offending, there were a total of 16 taxpayers whose details were used by the Offender.
Records held by the ATO show that all 16 taxpayers referred to in Table 2 used Tax Smart to lodge their income tax return for the year ending 30 June 2012, at some point prior to the fraudulent lodgement made by the Offender. Having located the taxpayer in the Tax Smart client database, the Offender used his access to the tax agent portal (PBBJSSx) to generate a 2013 pre-filing report for each taxpayer. With reference to the 2013 pre-filing report, the Offender was able to:
1. view a summary of each taxpayer's taxation affairs for the year ending 30 June 2013, including postal address, residential address, date of birth, employer, income earned, pay as you go (PAYG) amounts withheld, interest earned, prior year's deduction's, prior year's occupations and private health insurance policy details; and
2. falsely authenticate himself as each individual taxpayer and lodge an income tax return in their name using the 2013 eTax software program.
Before lodging each of the Income Tax Returns, the Offender made amendments to the taxpayer's details, including:
1. their bank account details such that the resulting refund was paid into a bank account controlled by the Offender; and
2. their postal address such that the resulting correspondence from the ATO would not reach the taxpayer and alert them to the fraudulent lodgement of an income tax return in their name.
Using the $22,475.18 as outlined in Table 2 paid into the various accounts controlled by the Offender as a result of his fraudulent lodgements, the 33 withdrawals were made from ATM's in Randwick and Kingsford, using the bank cards seized during the search warrant. Twelve of the withdrawals were in the amount of $1000. As a means of withdrawing more than $1000 in any one day on nine occasions, part of the income tax refunds would transfer between various accounts linked to the bank cards seized during the search warrant.
Twenty three of the 53 bank cards seized from the Menz Klub package during the search were in the name of Benigno Lee, hereinafter referred to as the Benigno Lee bank cards. The Benigno Lee bank cards were associated with 28 bank accounts that had been opened with the following 16 financial institutions. I will not read out the names of the institutions but they are set out in the Agreed Facts, comprising subparagraph (a) through to subparagraph (p).
Mr Lee is a 58 year old man who migrated to Sydney from the Philippines in 1999. He is unable to operate a computer. He met the Offender whilst working with him in a delicatessen at Coles Supermarket in Maroubra Junction. They became friends.
In about July 2013, the Offender approached Mr Lee and asked him to open bank accounts with various financial institutions. Throughout late July and early August 2013, Mr Lee went to numerous banks at the behest of the Offender to obtain the documentation necessary to open new accounts. The Offender received from Mr Lee correspondence that he had received from the various banks.
In August 2013, Post Office Box 90 was opened at the Australian Post Office at Kingsford in the name of Mr Lee to avoid detection. Having opened the Post Office Box, the bank's records were updated with respect to Mr Lee's postal address, redirecting any future correspondence away from Mr Lee's residential address in Dee Why to the Post Office Box 90 in Kingsford.
As set out in the next table which I have marked Table 3, and appears in the Agreed Facts, income tax refunds totalling $16,814.73 were paid into nine different bank accounts that had been opened in the name of Mr Lee. The nine tax refunds resulted from the lodgement of false income tax returns in the name of each of the taxpayers for the income tax year specified in Table 3. Table 3 sets out the names of the taxpayers, the tax years to which it applies, the financial institutions into which the amounts were paid, the account name being that of Mr Lee, together with the account number, refund and the date the refund was paid.
Records held by the Australian Tax Office showed that:
1. all nine taxpayers listed above had used Tax Smart to lodge an income tax return at some point prior to the fraudulent lodgement giving rise to the tax refund paid to Mr Lee's bank account controlled by the Offender; and
2. the Offender's unique identifier, PBBJSSx was used to access the tax agent portal to generate the relevant pre-filing report in respect of all nine fraudulent lodgements.
Before each false Income Tax Return was lodged, the postal address recorded for the taxpayer was changed and the details of a bank account controlled by the Offender were input into the income tax return. Using the $16,814.73 paid into the nine Lee accounts, 12 withdrawals were made from ATM's on Belmore Road in Randwick. Eight of those withdrawals were in the amount of $1000. Three of the nine tax refunds totalling $5,650.91 were not withdrawn or transferred from the relevant Lee accounts.
The loss to the Commonwealth of Australia arising from the Offender's conduct is, after credit for the amount not withdrawn, the sum of $85,375.46 for which the Commonwealth seeks reparation and in respect of which a reparation order will in due course be made.
[11]
Objective Factors
A predominant factor that is relevant to the sentences is the objective seriousness of the offending. It is not, however, necessary to articulate a determination by placing the offence along a hypothetical range. It remains an essential task to undertake an evaluative assessment of the objective seriousness of the offence.
The starting points are the legislative guideposts to which I have already referred. Next, one has regard to the particular circumstances of the offending in assessing the overall criminality.
The Crown submitted that there was an extensive and involved passage of offending which transpired over a considerable period of time and involved a substantial breach of trust by the Offender of his position as a tax agent. Additionally, the Offender had sole control of more than 100 bank accounts of 17 different financial institutions and 16 VISA cards into which the fraudulent refunds were paid, transferred and withdrawn. The Crown submitted that both offences before the court are objectively serious and I accept that submission.
The Offender submitted that it was not as substantial breach of trust that the Crown alleges and that the overall criminality is lowered as the Offender only received a percentage of the funds that were obtained in the course of the offending. Without hesitation I reject that submission. It raises questions as to whether in fact the Offender is at all remorseful.
Oral submissions made by Mr Driels, counsel for the Offender, also caused some concern and raised doubts about the Offender's acceptance of the seriousness of his offending. At one stage it was stated by Mr Driels:
"I won't start off and go into the areas that many people in our community think that taxation is theft anyway, from hardworking people, because that doesn't really take us anywhere, but it is a commonly held view. In their submissions, they say that this will cause others to pay more taxes. Well, we know taxation is a political thing, has got nothing to do with the money. Debts are accumulated by Governments, and Governments reduce tax now, not increased because of a lousy 100,000 that they say."
Whilst it is difficult to comprehend the relevance and significance of that submission, it plainly downplays the offending in such a way as to minimise its seriousness far below that which on an objective assessment of the conduct of the Offender, is reasonably justified. To refer to the amount stolen by the Offender from the Commonwealth revenue as "a lousy 100,000" is both insulting and not representative of community values. In considering that submission which was developed by counsel for the Offender, I have given it no weight in the sentencing exercise as I consider the statement to be absurd and contrary to commonly held beliefs.
I do not intend to affect the sentence to be imposed upon the Offender by the careless submissions made by counsel appearing on his behalf. In fact, in many respects his submissions were difficult to follow and often incoherent. For example where it was stated:
"Well, a Jehovah's Witness on one side, Muhammad on the other side, it's a bit iffy, but this is - nobody - this is the person, and sentencing has to be the person."
What was intended by that submission is impossible to determine. I assume the reference to Muhammad is a reference to the Offender and I assume the reference to the Jehovah's Witness is a reference to one of the character references provided on behalf of the Offender. The submissions made on behalf of the Offender were generally speaking, unhelpful and imprecise. Despite that, I have nevertheless engaged in a process of determining the appropriate sentence by weighing carefully the objective seriousness of the offending and the subjective concerns and factors raised in the Offender's case.
In terms of the objective seriousness of the offending, I accept the submission by the Crown that the offending is objectively serious, given the level of planning and degree of effort undertaken by the Offender. I consider in the range of offending, it would fall in the high end of the midrange.
The Court may also have regard to any factors under s 16A(2) of the Commonwealth Crimes Act (1914) that are relevant to the offending and the Offender. These include:
1. the nature and the circumstances of the offence being a sophisticated and planned enterprise. The enterprise developed by this Offender was extremely sophisticated and involved a high degree of planning;
2. a course of criminal conduct which occurred over a 20 month period and had a single motive of financial gain. It was submitted that it could be found, and I so find that the Offender had used considerable resources and time since becoming a qualified tax agent in systematically defrauding the Commonwealth. I note the Offender became a registered tax agent in July 2012 and commenced offending almost immediately;
3. the personal circumstances of any victim of the offending with each of the taxpayers whose names and identity were used by the Offender having to recover from the Income Tax Refund rightfully owed to them, having to apply for new Tax File Numbers and uncertainty in relation to their taxation affairs. The abuse of trust by the Offender is abhorrent. Without their knowledge the personal information of a large number of otherwise law-abiding tax paying citizens was accessed and abused by the Offender. In considering the victims of offending, I have also taken into account the Victim Impact Statement which was provided by Mr Lee. Whilst there is no evidence that he suffered any financial consequences as a result of the offending by the Offender, it is plain that he was used and their friendship abused in order to facilitate the opening and creation of a number of bank accounts to permit the offending to take place. Behind Tab 4 in exhibit A is a Victim Impact Statement in which Mr Lee describes in brief but effective detail, the effects that this Offender's conduct had upon Mr Lee. I will quote a section of the Victim Impact Statement.
"I was in complete shock when the Federal Police came looking for me, following my interview with Federal Police I went into a deep depression, I locked myself in my room for four days without food, my family took me to see a doctor, then I was referred to see a psychologist for treatment. Up until today I cannot cope with the normal stresses of life, and must take antidepressant medication … This crime has a huge impact on me, mentally and emotionally. There are days and nights that I feel angry, afraid, upset, shaking and have difficulty sleeping. I am unsettled and confused."
1. the Offender plainly took advantage of Mr Lee in creating the complex scheme which permitted the theft from the Commonwealth engaged in by the Offender;
2. the financial loss resulting from the offence. In terms of the Commonwealth's revenue, the amount in question is not significant but the theft of money from the Government impacts on every tax paying individual. Although the amount in question of just in excess of $85,000 is of itself not particularly significant, it is noteworthy that the offending continued until the Offender was arrested and charged;
3. a plea of guilty;
4. contrition and remorse, having regard to the evidence to which I will refer in a moment, I do not accept that the Offender is remorseful. His guilty plea was made in the face of a very well investigated and strong Crown case. I find he has no entitlement to leniency by reason of remorse;
5. his lack of cooperation with law enforcement agencies;
6. character, antecedents and background of the Offender. This Offender is not entitled to a finding of good character and any leniency which may otherwise flow from such a finding. I will return to that in a moment; and
7. the probable effects of sentence on the Offender's family or dependents. Whilst this will no doubt be considerable it must be borne in mind that the sentence to be imposed flows directly from the opportunistic conduct of the Offender. I will return in a moment to the hardship to his family.
[12]
Subjective Case
The Offender is 43 years of age. He was born and raised in Bangladesh, having reported in his letter to the Court that he was born into an upper-middle class family in Bangladesh where he was the eldest of three siblings. In no sense could his upbringing be described as in any way deprived or disadvantaged.
The Offender stated that his parents provided him and his sisters with all the facilities that they needed to be successful which resulted in top private school tuition and high level performance at university.
The Offender had a privileged upbringing which in fact armed him with the skill to carry out such an elaborate deception on the government. The Offender graduated from the University of Dhaka with a Bachelor of Commerce and Master of Commerce degree. The Central Queensland University awarded the Offender a Graduate Diploma of Management and a Master of Accounting in 2006 followed by a Master of Business Administration in 2007. The Offender was registered as a Certified Practising Accountant in 2011 and as I previously mentioned a Tax Agent in 2012.
The Offender subsidised his studies by working at a supermarket between 2005 and 2012; during that time he befriended and later abused the trust of Mr Lee. In 2012, the Offender became a Tax Smart franchisee; he wasted no time in carrying out his acts of deception on the Commonwealth abusing his access to private information of tax paying individuals. He is presently unemployed and frankly ought never be employed in a position of trust again.
His marriage was culturally arranged by his family in Bangladesh and he initially met his wife over the telephone in 2009. They married in Bangladesh in 2010 and have one child to their marriage, an infant son who at the time of the sentence hearing was approximately 18 months old. It is of course regrettable that his family will suffer as a result of this sentence but again it is the direct result of the criminal offending committed by the Offender himself.
The Offender reported that the circumstances leading to his offending was that his wife had come to Australia and he needed to pay for her educational and living expenses. He stated that he was living a lie to his family back in Bangladesh, who thought he was a successful partner of an accounting firm. Frankly, the explanations provided by the Offender are pathetic and do not justify or in any way ameliorate his criminal conduct.
I have had regard to a character reference from Humaira Mahin, the Offender's wife, who gave an extensive history of their relationship, particularly concerning her surprise as to the offending. Ms Mahin reported shock when she learned of the Offender's arrest and, at that time, considered divorce. She stated that she is deeply worried about their future, particularly if the Offender is imprisoned. Regrettably their future will be adversely impacted by the sentence, but again it is the direct consequence of choices made by an intelligent man.
I have also had regard to a character reference from Ms Sultana, the Offender's younger sister. She stated that the Offender's family were taken aback at the news of his offending, as he was a role model within their neighbourhood in Bangladesh. Frankly, I place little or no weight on this unsworn, untested evidence.
I have also had regard to a character reference also unsworn and untested by Chow Meng P'ng, an ordained minister of the Jehovah's witness. Mr P'ng has described the Offender as a reliable man within his bible learning group and that he was surprised to learn of the Offender's actions. His surprise is of no concern to the Court upon sentencing. The Offender acted regularly to deceive and manipulate, including the manipulation of those close to him, including Mr Lee.
I have also had regard to the character reference, again unsworn and untested, by a Mr Hossain, a former business partner of the Offender. Mr Hossain described the Offender as a very caring father, husband, brother and son to his family and that he was well respected within the business. Frankly, this reference does nothing but demonstrate the ignorance of its author to the true character of the Offender.
As part of the subjective case the Offender has also sought to rely upon what is referred to as a psychiatric report by Mr Awit, dated 19 June 2018. The first thing to observe about the psychiatric report is in fact Mr Awit is not a psychiatrist but rather a psychologist. Caution of course must be adopted in giving consideration to the opinions expressed by a psychologist in that to the extent that they relate to psychiatric diagnoses.
The Crown drew the Court's attention to the decision of the Court of Criminal Appeal in the matter of Lamb v R [2015] NSWCCA 143 where the Court in some detail commencing at [75] set out the concerns about a psychologist expressing psychiatric opinions.
Before I return to the report I make the following general observations about psychiatric illness.
[13]
Mental Illness
The fact an Offender was or is suffering from a mental disorder or disability, either at the time of the commission of the offence, or at the time of the sentencing may be taken into account at sentencing and I refer to the decision of the Victorian Court of Appeal in R v Anderson [1981] VR 155.
An Offender's mental condition can have the effect of reducing a person's moral culpability in matters such as general deterrence retribution and denunciation may have less weight: Muldrock v The Queen (2011) 244 CLR 120 at [53]; R v Israil [2002] NSWCCA 255 at [23]; R v Henry (1999) 46 NSWLR 346 at 354.
This is especially so where the mental condition contributes to the commission of the offence in a material way: DPP (Cth) v De La Rosa (2010) 79 NSWLR 1 at [177]; Skelton v R [2015] NSWCCA 320 at [141].
The High Court explained the rationale for the principle in Muldrock at [53] as:
"One purpose of sentencing is to deter others who might be minded to offend as the Offender has done. Young CJ (R v Mooney) in a passage that has been frequently sighted said this: "General deterrence should often be given very little weight in the case of an Offender suffering from mental disorder or abnormality, because such an Offender is not an appropriate medium for making an example to others.""
I have also had regard to the contents of para [54] of the High Court's decision in Muldrock. Sentencing an Offender who suffers from a mental disorder commonly calls for a "sensitive discretionary decision". I note the decision of R v Engert (1995) 84 A Crim R 67 at 67. This involves the application of the particular facts and circumstances of the case to the purpose of criminal punishment as set out in Veen v The Queen (No 2) (1988) 164 CLR 465 at 488.
The purposes of sentencing overlap and often point in different directions. In considering the evidence of the psychologist in this case, I am mindful of the comments made by Johnston J in R (Cth) v Petroulias (2008) NSWSC 626 at [164] where his Honour stated:
"In approaching their evidence, I keep in mind that it is important that psychologists do not cross the barrier of their expertise. It is appropriate for persons trained in the field of psychology to give evidence of the results of psychometric testing and other psychological testing and to explain the relevance of those results and their significance so far as they reveal or support the existence of brain damage or other recognised mental states or disorders. It is not however appropriate for them to enter into the field of psychiatry".
Mr Awit was not cross-examined or in any way challenged. It is necessary nevertheless to closely examine his report before drawing any conclusions from it.
In Aslan v R [2014] NSWCCA 114, Simpson J at 34 observed four principles that relate to how a mental health condition impacts on the objective seriousness of criminal offending. Simpson J stated that:
"It does not follow that because an Offender suffers from some mental impairment or disability his or her moral culpability is reduced (principle 1) nor that he or she is an inappropriate vehicle for general deterrence (principle 2) nor that a custodial sentence will weigh more heavily upon him or her (principle 3) nor that the significance of specific deterrence is reduce or eliminated (principle 4)."
The report of the psychologist Mr Awit dated 19 June 2018 followed four consultations with the Offender. He took a history relating to family, education, employment and health which are generally consistent with observations which I have already made.
Under the heading "current circumstances" Mr Awit stated:
"Mr Kabir advised that since 25 June 2014, his life was turned upside down, when members of the AFP and ATO attended his home to execute a search warrant. He advised that the investigation and court proceedings had continued over the last four years.
Mr Kabir advised that he still experiences low mood anxiousness, emotional instability as well as shame towards the impact his actions have had on him, the Commonwealth and his family."
The psychologist then proceeded to make a number of psychiatric diagnoses by reference to the DSM-V, the Diagnostic Manual for Psychiatric Disorders. By identifying the criteria for such diagnoses, the psychologist diagnosed a Generalised Anxiety Disorder which manifested itself in moderate anxiety and also depression manifesting itself in a form of moderate depression. At page 8 of the report the psychologist stated:
"BDI results indicate that Mr Kabir suffered from moderate depression during the period of offending, these results are consistent with the symptoms reported that meet the DSM5 diagnostic criteria for major depressive disorder."
The factual basis upon which the diagnoses are made is also questionable. I note for example that the Offender reported to the psychologist that he experienced a difficult childhood and experienced struggles in relocating to this country. He also referred to experiencing "great shame" and other aspects of his life which would be considered inconsistent with the other evidence pertaining to character referred to in the Offender's bundle (Exhibit 1).
The psychologist found that there was a psychological nexus between the Offender's condition and the offences he committed. How the psychologist can form that opinion in circumstances where the offending occurred some four years prior to his assessment of the Offender is difficult to understand and does not bear any logical analysis.
In considering the report of Mr Awit, I have formed the opinion that he has traversed matters of a psychiatric nature beyond his expertise and for that reason I give little or no weight to the psychiatric diagnoses which he makes. I give no weight to the alleged nexus between the psychiatric diagnoses made in 2018 to the offending which occurred a number of years earlier.
Whilst I have read and carefully considered the views of the author of the psychology report, those two factors are troubling; that is the lack of any evidential basis for the opinions expressed and the fact that the opinions go outside the realm of the author's expertise.
I note that the Offender did not give evidence in the course of the sentence hearing, which may have provided him an opportunity to provide evidence as to his psychiatric/psychological condition at the time of offending.
He did, however, provide a letter to the Court dated 28 June 2018, in which he provided some personal information together with the circumstances leading to his offending.
The only insight into the reason for offending appears on the second page of the document at tab 2 of Exhibit 1, in which the Offender stated:
"My wife had also come to Australia and my expenses had gone up. I needed to pay for her education and living expenses. For two years she was unemployed as she studied to convert all her overseas qualifications into Australian degrees".
The letter from the Offender is the only source of factual information upon which any psychological or psychiatric opinion could have been based and glaringly absent from that document is any reference to a major depressive disorder or an anxiety condition at the relevant time of the offending. The letter from the Offender, of course, is unsworn and untested by cross-examination and, for that reason, little weight will be given to it.
[14]
Good Character
The Offender's character is relevant of course to sentence. The good character of an Offender is a matter that may be taken into account in mitigation of the penalty. It is one of a number of matters the court must consider the nature and circumstances of the offences, of course are of the upmost importance.
In cases involving white collar crime such as this matter, less weight is attached to prior good character, because it is normally that factor, that is good character, that places the Offender in a position of trust which enables him to commit the offence. That topic was recently discussed I recall by the Court of Criminal Appeal, but it is fully explained in the decision of R v Rivkin (2004) 59 NSWLR 284. Given the circumstances, I decline to afford leniency based on good character.
[15]
Remorse
Evidence of contrition or remorse in respect of the subject offending is also a relevant consideration. Evidence of remorse must be assessed in context, remorse is but one feature of post-offence conduct upon which an Offender may seek to rely as a matter which has the potential to mitigate penalty. Ordinary human experience would suggest that it is only natural that a person who has committed some misdeed, would wish to make the most favourable impression possible and seeking to making amends for it.
Here the evidence of remorse is the guilty plea and some remorse conveyed to the psychologist, Mr Awit. Mr Awit reported the Offender expressed shame and remorse in relation to the offences. For the reasons given, I approach hearsay based expressions of that nature with some circumspection.
What was recorded by the psychologist to some extent conflicts with the comments made by the author of the Pre-Sentence Report, Joe White, dated 18 June 2018. The author of that report noted that the Offender's remorse appears to be primarily based in self-impact and the impact on his immediate family. Ms White observed that there appeared to be a significant degree of minimisation with regard to the Offender's attitude to his offending.
In the circumstances and absent any evidence from the Offender in the course of the sentence hearing, I decline to find genuine remorse.
[16]
Hardship
One matter which looms large in this case is the hardship to the Offender and to his family which may be occasioned by the sentence. I note that in his statement to the court the Offender, on the second page, refers to the effect which even the charges have had upon his life and his family. I have had regard to those matters.
I have also had regard to the fact that the Offender and his wife had a young child who, at the time of the hearing, was 18 months old. It was said that a period in custody would be particularly harsh in the case of the Offender, as he is the carer of that child and his wife is completing her surgical registrar placement. It was submitted that a period in custody would result in the Offender's wife having to endure great hardship in balancing her parental duties and her medical studies. This is a relevant factor per s16A(2)(p) of the Commonwealth Crimes Act.
The common law has determined that the probable effect must be exceptional. I note the decision of R v Togias (2001) 127 A Crim R 23 at [13]-[17] and R v Hinton (2002) 134 A Crim R 286 in which Howie J stated:
"It should be emphasised that the question of whether the probable effect of a sentence upon a third party will give rise to an exceptional case, cannot be considered in isolation from the facts of the particular matter and the degree of criminality involved in the offences for which the sentence is to be imposed."
As an example circumstances were held to be not exceptional in the matter of R v Capper [2000] NSWCCA 63 where the incarceration in that case of the Offender caused his children for whom he had sole care to become wards of the state and to reside with foster parents.
When the particular circumstances of this Offender's family situation are considered with the facts of this matter and the degree of criminality, I do not find that there are exceptional circumstances. Again imprisonment and its consequences ought to have been in the contemplation of the Offender when he chose to engage in the subject offending.
[17]
Rehabilitation
Having given careful consideration to the evidence which informs this matter, I find that the prospects of successful rehabilitation are guarded. That evidence includes the opinion of the psychologist, Mr Awit, who stated that ongoing psychological intervention will assist in developing alternative strategies to manage his anxiety and difficult emotions.
[18]
Re-offending
Consistent with my finding concerning rehabilitation I find the likelihood of re-offending is low. I have also had regard to the opinion as to this matter in the Pre-Sentence Report; obviously the fact that the Offender is no longer is a tax agent and never will be, makes re-offending of this particular type unlikely if not impossible.
This may bear upon a reduced need for specific deterrence, but elevates the need for rehabilitation.
[19]
General Principles
Section 16A of the Commonwealth Crimes Act sets out the purposes for which a Court may impose a sentence on an Offender. The list is not as exhaustive as s3A of the State Act, but the relevant principles to be applied are as follows:
1. punishment, that is to ensure the Offender is adequately punished for the offence;
2. deterrence, that is general and specific deterrence; and
3. rehabilitation that is to promote the rehabilitation of the Offender.
I refer to the comments made in a dissenting judgment of Campbell J, in the matter of Noble v R [2018] NSWCCA 253, 9 November 2018, in which his Honour at [46] stated:
"Offences involving fraud on the revenue call for a sentence which emphasises denunciation, punishment and general deterrence."
His Honour relied upon the High Court's decision in Hili v The Queen (2010) 242 CLR 520. In support of that proposition, he quoted the following extract from Hili at [63]:
"The applicant's offending was sustained over a long time. It was planned deliberate and deceitful, requiring for its implementation, the telling of many lies, the applicants acted out of personal greed, the amount of tax evaded was not small. Detection of offending of this kind is not easy, serious tax fraud, which this was, is offending that affects the whole community, as has been pointed out in previous cases, the sentences imposed had to have both a deterrent and punitive effect and those effects are to be reflected in the head sentences and the recognizance and release orders that were made".
As Campbell J noted in Noble, I consider those observations to be apposite in this particular case.
[20]
Instinctive Synthesis
Sentencing is ultimately an exercise in instinctive synthesis. I note the Court of Criminal Appeal reminded the sentencing judges of that recently in a matter of Conte v R [2018] NSWCCA 209. It involves the consideration of the purposes for sentencing in the context of weighing the objective gravity of the offending with the Offender's objective case. In the present case there are considerations which work for and against the Offender. The Court, in coming to the sentence that it imposes, measured the offending in light of the goal post considerations which apply against the various features in the subjective case, including the Offender's upbringing and mental health.
[21]
Proportionality
The Court in determining this matter has also had regards to the question of proportionality. That is, the sentence or the punishment must fit the crime. A sentence should not be increased beyond what is proportionate to the crime in order to merely extend the period of protection of society from the Offender.
The principle of proportionality finds the statutory expression in the purpose for sentencing. That is, to ensure that the Offender is adequately punished for the offence. The proportionality principle requires that a sentence should neither exceed nor be less than the gravity of the crime having regard to the objective circumstances.
[22]
Imprisonment
I must be satisfied having considered all possible alternatives, including non-custodial sentences, other than imprisonment, is appropriate.
In this case the Crown contended that a threshold under s17A(1) had been met and that a term of imprisonment was warranted.
Counsel for the Offender submitted that this threshold had not been met. He referred to the opinion of the author in the Pre-Sentence Report, who identified the Offender as being suitable for a community service order.
Since this matter was heard before me the law in this state has changed which led to further submissions being provided on behalf of both the Offender and the Crown. It was submitted on behalf of the Offender that as the new regime permits the imposition of an Intensive Correction Order for up to three years that ought to be considered as an appropriate sentence outcome in this case. It was also identified that the ICO's are now more flexible and can be more onerous.
Whilst I am mindful of the comments made by the Attorney-General at the time of the Second Reading Speech for the amending legislation, I do not accept that this matter ought to be dealt with by way of an intensive corrections order.
The Crown also provided further submissions dealing with that matter and correctly identified that the comments of Johnson J, with whom Leeming JA and Hall J agreed in the matter of Hinchcliffe v R [2013] NSWCCA 327, where it was stated that:
"This court has emphasised as well the significant degree of leniency involved in the use of an ICO as a sentence".
In its supplementary submissions the Crown emphasised a number of points which they had raised in their earlier submissions arguing that an Intensive Corrections Order would not be an appropriate sentence outcome in this case. I note the contents of paragraph 6 of the supplementary submissions. I agree with the submissions of the Crown that an Intensive Corrections Order would not be an appropriate sentence outcome in that it would not result in the Offender being adequately punished.
[23]
Guilty Plea
In accordance with s16A(2)(g) of the Commonwealth Crimes Act the Court must also in passing sentence take into account the fact that the Offender has pleaded guilty, when the Offender pleaded guilty and the circumstances in which the Offender indicated an intention to plead guilty. After taking those matters into account the court may impose a lesser sentence than it would otherwise have imposed.
In this case the Offender pleaded guilty on 13 June 2017 which is at a relatively late stage. I note further that he was initially arraigned on an indictment which was far more extensive than that to which he ultimately pleaded guilty and the matter, although listed for trial in June 2017, did not commence, there was no empanelment of a jury and time was taken to negotiate a plea resulting in the current charges to which the Offender has pleaded guilty and on the form admitted his guilt.
I am mindful of the decision of Xiao v R [2018] NSWCCA 4 at [269]-[278] where it was held by the bench of five in the Court of Criminal Appeal that s16A(2)(g) requires a court to take into account the utilitarian value of a guilty plea as well as the facilitation of justice achieved by a guilty plea when considering the facts that an Offender has pleaded guilty. In the matter of Liu v R [2018] NSWCCA 70 Bathurst CJ, assisted sentencing judges by clarifying the approach should be adopted at [9]:
"Because somewhat divergent views have been expressed on the issues raised in this appeal, it may be of assistance to specify the approach which should be taken by sentencing judges in dealing with the utilitarian value of a plea of guilty in respect of Commonwealth offences having regard to the decision in Xiao v R and the judgment handed down in the present case:
1. Sentencing judges should take into account the utilitarian value of a plea in Commonwealth sentencing offences. Failure to do so constitutes error.
2. It is desirable that any discount given for the utilitarian value be specified. However, a failure to do so would not of itself constitute error.
3. It is an error to specify a range of percentage discounts as distinct from a specific percentage.
I also note again the more recent decision of Noble where that approach was affirmed.
In the present case, the Crown submitted that in light of the guilty plea there ought to be some discount but refrained from making a specific submission as to what that discount ought to be.
On behalf of the Offender, it was submitted today that a range of 10 to 15% would be appropriate given the lateness of the plea. However, after considering the matter with the assistance of the Crown, Mr Hanna who today appears on behalf of the Offender agreed with the Court that a discount of 20% would reflect the true value of the plea, particularly in circumstances where the plea came after extensive negotiations from a far more lengthy indictment.
[24]
Consistency
Consistency in sentencing is important I have had regard to the statistics provided by counsel for the Offender on the last occasion. I have also had regard to the material provided on behalf of the Crown and I am satisfied that the sentence to be imposed on this Offender comes within the range of sentencing outcomes for offences of this type.
[25]
Totality
Having regard to the principles and the question of totality, I intend to impose an aggregate sentence, this is also appropriate in order to reflect the criminality before the Court. I am of course first required to record the sentence which I would otherwise have imposed in respect of each count on the Crown Sentence Summary.
The Court has discretion in relation to aggregate sentences, the purpose of which is to avoid the imposition of a sentence for two or more offences which when viewed as a total sentence is not crushing. Some offences for example, those involving substantial temporal disconnect or of a completely different nature may not permit an aggregate sentence. In my opinion the offending in this case does permit an aggregate sentence.
[26]
Indicative Sentences
Before announcing the indicative sentences, I note that the charges on the s16BA schedule which I note is a certificate to which has been signed previously by Conlon DCJ and again by me today, attaches to the second charge on the sentence.
In respect of the first charge, namely dealing with the proceeds of crime, were it not for the fact that I intend to impose an aggregate sentence, I would have sentenced the Offender to a period of imprisonment after discount of 20% of three years imprisonment.
In respect to the second charge, and having regard to the s16BA matter, which attaches, namely dishonestly obtaining a financial advantage by deception, were it not for the fact that I intend to impose an aggregate sentence, I would have sentenced the Offender to a period of imprisonment of three years after a discount of 20% for the guilty plea.
The total indicative sentence therefore is six years imprisonment after a discount of 20%.
[27]
Aggregate Sentence
As for the aggregate sentence I am satisfied that the approach taken to the determination of it does not offend the principles enunciated by the Court of Criminal Appeal concerning matters of totality and the like and the sentence to be imposed is not crushing.
Mr Kabir you are convicted of the two offences set out in the Crown Sentence Summary to which you have pleaded guilty. You are sentenced to an aggregate sentence being a term of imprisonment of five years with a non‑parole period of three years. The sentence will commence today, 13 November 2018 with a non‑parole period expiring 12 November 2021. The head sentence will expire on 12 November 2023.
Additionally, pursuant to s21B of The Crimes Act, I make a reparation order for the amount the Offender defrauded from the Commonwealth, namely $85,375.46.
[28]
Note - These ex-tempore remarks were revised without access to the court file.
[29]
KABIR Md. - Agreed Statement of Facts - 13 June 2017 (303 KB, pdf)
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Decision last updated: 01 April 2019