M M Crawford-Fish (Counsel for the offender)
File Number(s): 2020/188512; 2021/173784
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Judgment
The offender, Prince Ogbeide, is 26 years old and appears for sentence on a number of charges arising out of his involvement in a criminal syndicate which carried out business email compromise (BEC) frauds and online romance scams. The objective of the criminal group was to obtain financial reward from the proceeds of those scams and to launder the proceeds through a variety of bank accounts, foreign currency exchanges, gold bullion purchases and cryptocurrency remitters.
As part of a Police Strike Force investigation, he was identified as receiving proceeds into his own bank accounts from romance scams, operating as a conduit between participants in the criminal syndicate, in particular Mr Nzeribe and participants involved directly or indirectly in committing the actual BECs and using the proceeds from the above offences to purchase Bitcoin (BTC) between 4 October 2019 and 19 March 2020.
On 2 April 2020, Police arrested Nzeribe and on searching his phone they found communications between Nzeribe and the offender. The offender was arrested on 25 June 2020. A number of items were seized when police searched his residence, including laptops, mobile phones and other electronic storage devices.
He participated in an interview and he told Police that he received $2,500 to $3,000 per fortnight in pay. He had received $150,000 in the last 24 months from his parents. He said he withdrew it all from the bank and kept it at home, but he was not feeling safe with the money, so he sent it back to his parents.
He said he sent the money through Bitcoin, because that is the only way money can be transferred to Nigeria. He denied purchasing $219,000 of Bitcoin, telling Police it was only around $120,000.
He denied using WhatsApp, he denied speaking with Nzeribe on WhatsApp. He said that he did not deposit the $596,000 that was shown as being deposited into his Westpac account between August 2018 and January 2019 and he said to the police that he kept moving money back into his account to make his statement look reasonable for the purpose of obtaining a loan.
His involvement in the syndicate leads to him pleading guilty to a number of offences. His pleas of guilty were entered in circumstances justifying a 25% discount on any term of imprisonment and also as a result of material contained in a confidential affidavit, it is appropriate to allow a further 10% discount pursuant to s 23 of the Crimes (Sentencing Procedure) Act 1999, so that a total discount of 35% will be allowed for in the term of imprisonment, which Mr Crawford-Fish concedes is appropriate.
The offences for which the offender is to be sentenced are as follows:
1. Sequence 1 (H74750013) of participate in a criminal group contrary to s 93T of the Crimes Act 1900. The offence carries a maximum penalty of five years imprisonment.
2. Sequence 2 (H74750013) of knowingly deal with the proceeds of crime contrary to s 193B(2) of the Crimes Act 1900. The offence carries a maximum penalty of 15 years imprisonment with no standard non parole period. This sequence relates to a sum of $52,681.
3. Sequence 3 (H74750013) of knowingly deal with the proceeds of crime contrary to s 193B(2) of the Crimes Act 1900. The offence carries a maximum penalty of 15 years imprisonment with no standard non parole period. The sequence relates to a sum of $54,719.
4. Sequence 10 (H74750013) of knowingly deal with the proceeds of crime contrary to s 193B(2) of the Crimes Act 1900. The offence carries a maximum penalty of 15 years imprisonment with no standard non parole period. This sequence relation to a sum of $110,994,
5. Sequence 14(H74750013) of dealing with identity information to commit an indictable offence contrary to s 192J of the Crimes Act 1900. The offence carries a maximum penalty of ten years imprisonment with no standard non parole period.
6. Sequence 8 (H81102918) of dealing with property of proceeds of crime contrary to s 193C(1) of the Crimes Act 1900. The offence carries a maximum penalty of five years imprisonment. This sequence involved a sum of $341,077.
There are also five matters attached to sequence 10 on a Form 1 and they will be dealt with in the way suggested by the Chief Justice in the guideline judgment (Attorney General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 No 1 of 2002 (2002) 56 NSWLR 146). The Form 1 matters include:
1. Sequence 12 (H4750013), knowingly deal with the proceeds of crime in relation to $29,920 (s 193B(2) of the Crimes Act 1900).
2. Sequence 9 (H81102918), another offence of recklessly dealing with the proceeds of crime in relation to $50,000 (s 193B(3) of the Crimes Act 1900).
3. Sequence 10 (H81102918), dealing with property the proceeds of crime in relation to $52,330 (s 193C(2) of the Crimes Act 1900).
4. Sequence 11 (H81102918), dealing with property the proceeds of crime involving $110,720 (s 193C(1) of the Crimes Act 1900) and
5. Sequence 17 (H81102918), knowingly dealing with the proceeds of crime involving $32,530 (s 193B(2) of the Crimes Act 1900).
The total amount in question is $835,031.
As indicated, there are no standard non-parole periods in relation to any of the principal offences or the Form 1 matters.
He has been in custody since his arrest on 25 June 2020 and that will be taken into account in setting the commencement date.
The Crown bundle sets out the details of some other members of the operation who have been sentenced to date, including Jayden Dunn, Maxwell Kyere, Denis Ochaya, Junior Sowah and Steven Tabuatamata. It is unnecessary to look at the details of all of those as there is no real question of parity involved. However some attention has been given in the proceedings to the sentence imposed by Pickering SC DCJ on Racha Salame (R v Salame (unreported, NSWDC, 1 April 2021)), who, in relation to a different mix of charges imposed a sentence of imprisonment of three years and four months, with a non-parole period of one year and three month, which is a ratio of only 37%. As Pickering SC DCJ himself acknowledged, that is a very large finding of special circumstances, having regard to the particular objective matters involved in her case.
The agreed facts are set out in great detail over 111 paragraphs and 20 pages of material, but the Crown has conveniently and helpfully summarised the relevant matters to be taken into account in written submissions and I will return to those for the purposes of enumerating the facts upon which objective seriousness is to be assessed and on which the ultimate sentence is determined.
His criminal record includes, An offence of dealing with property the proceeds of crime in May 2017, which was dealt with by a three‑year community corrections order concluding 8 May 2022. In June 2018 there was an offence of possess identity information to commit an indictable offence, which was taken into account on a Form 1. There is a further dealing with property the proceeds of crime in February to April 2018 and another one in January 2018, leading to a community corrections order for 18 months.
At the time of the offences He was subject to a three-year community corrections order in relation a sentence imposed on 9 May 2019 to and on community corrections order of 18 months imposed on 3 March 2020. In relation to a number the more recent offence he was also on bail in relation to two of the offences for which he is to be sentenced today.
A Sentence Assessment Report and a report of Tim Watson-Munroe, psychologist, set out his subjective case in some detail. He describes a supportive relationship with his wife and child. He is a Nigerian who came to Australia on a student visa. He has work experience as a disability support worker and holds a certificate in accounting and is studying a Bachelor of Community Service. He indicated that among his social influences were spending time with negative peers and he apportioned blame to them influencing his antisocial behaviour. He rationalised his offending as his co‑offender had assured him that companies would be reimbursed by insurance and would not get caught. He said everything got out of control and he did not possess the strength to distance himself from his co-offender.
He told the author of the Sentence Assessment Report that his offending behaviours were not for financial gain, but he contradicted this by stating that his co-offender paid him $10,000 to $15,000 for his time and expenses.
As to insight, he failed to identify the impact of his offending behaviours and the potential impact on victims and he mixed remorse with self-concern of potentially losing his family due to the shame it has brought on him.
He had previously been subject to a 300-hour community service order, but only completed 130 hours of that due to COVID restrictions. He was assessed as being at a low risk of reoffending.
I have had regard to the facts in relation to the earlier matters, the first of which involves a sum of $30,128 in relation to the 2017 offences and the 2018 matters involved a sum of $13,200.
Mr Watson-Munroe described him as a depressed and anxious man with complex clinical history categorised by ongoing depression, anxiety and low self-esteem which impacted upon his judgment. He came to Australia when he was 18 years of age and he was motivated to improve his prospects in life by furthering his education, but he drifted in with an adverse peer group. After studying in Darwin he moved to Sydney and worked with the Salvation Army as a facilitator for about two and a half years and then with Sunnydale Care as a disability support worker which was continuing up to the time of his arrest.
He was married in February 2019 to a woman he met in February 2017 who is also Nigerian. He has been working as a sweeper while in the COVID hold section of the prison.
He started using cannabis in about 2017. He said that he was using up to $1,000 a fortnight of cannabis. His wife advised him to check into a rehabilitation centre. Since being in custody he has detoxified from alcohol and drugs.
As to his reoffending he said that this occurred in the setting of an absence of treatment and him continuing to associate with the person involved in the scheme.
In terms of prospects of rehabilitation, he has detoxified, his marital situation has stabilised, he is receiving pastoral care in prison and has positive aspirations for the future. He conceded, however, that his mood is being affected to an extent by the implications of his offending beyond incarceration, in terms of the possibility that he may be deported upon completion of his sentence.
That issue, in conjunction with his strong desire to support his wife and child has further bolstered his motivation to deal with his problems both in prison and upon his release. Mr Watson-Munroe suggested that he would benefit from some therapy.
I have a letter from the offender, which was confirmed when he gave evidence last week. He says that the 18 months in custody has given him time to look at himself and think and reflect on his offending and he is ashamed of it. He now knows that his offending has affected others mentally, emotionally and financially, which is unacceptable. He has used the time to rehabilitate himself to become a better father, husband and human. He says he understands his offending has caused damage and he will spend the rest of his life doing the right thing to make up for his past mistakes.
I have favourable references from an employer in the tiling services industry and from the chaplain at Cessnock Correctional Centre. He has done the Positive Lifestyle Program with The Salvation Army and I have a letter of support from his wife, who is a registered nurse at Royal North Shore Hospital. She says that he has moved closer to God and has been regretting his mistakes since his arrest. She said that he has promised her that he will never put his family in such pain again. She says that he is incredibly remorseful for what he has done. His mother-in-law speaks in similar terms.
I have been assisted by comprehensive written submissions from the Crown and from Mr Crawford-Fish, on behalf of the offender.
The Crown reminds me, of course, of the general principles of sentencing and the maximum penalties for each offence, which are matters which must be taken into account as yardsticks in the sentencing process.
The general principles for sentencing in relation to proceeds of crime offence include an acknowledgement that general deterrence must be reflected to a significant degree, because money laundering is serious criminal activity and justifies severe punishment.
The most important consideration in sentencing is to consider the role of the offender, because there may be little evidence concerning the organisation behind the offence, the source of the funds or the ultimate use to be made of them. The number of transactions and the period over which the transactions have occurred are significant, as they indicate the extent of the offender's criminality. Generally, a number of transactions involving small amounts of money will be more serious than a single transaction of a larger amount, as the latter may be seen as an isolated offence.
As the Court said in Ramos v The Queen [2018] NSWCCA 206, a number of factors relevant to objective seriousness include the manner of dealing, the level of planning and sophistication involved in the dealing, the underlying criminal conduct from which the proceeds were derived, the amount of the proceeds of the crime and the harm occasioned by the conduct.
Turning to objective seriousness, as the facts note, the offender received, between 20 August 2018 and 9 January 2019, $341,000 in cash into his account through deposits made at various ATMs and branches in New South Wales, Tasmania and South Australia. The offender spent the proceeds on daily expenditures and transferred money overseas. He operated has a conduit between participants in the criminal syndicate, in particular Nzeribe and participants involved directly or indirectly in committing the actual BECs and he used the proceeds from the above offence to purchase Bitcoin in the sum of $253,700, between 4 October 2019 and 19 March 2020.
In relation to the romance scams, the offender received a significant amount of money into his bank account, namely $554,127, between 20 August 2018 and 18 November 2019. He then received a further amount in cash as I have indicated of $341,077. The victims of the romance scams deposited money directly into accounts belonging to other members of the syndicate and the funds were then transferred into the offender's account.
In relation to the BECs, the offender operated as a conduit between Nzeribe and the hackers involved in intercepting email communications sent to and from businesses, and sending fraudulent emails seeking payment of invoices or transfers for other purposes. The offender would pass on account details received from Nzeribe for them to be used in a BEC. Once the BEC was conducted the offender would notify Nzeribe of the amount that was due to be deposited and when it would be deposited.
In relation to these he dealt with a significant amount of money as a conduit in the sum of $248,373 between May 2019 and March 2020.
I accept the Crown's submission that he had a key and senior role in the hierarchy, as demonstrated by the fact that he was provided access to screenshots in relation to the BECs which he then provided to Nzeribe. He was trusted with knowledge about the quantum of money to be deposited and when the money was to be deposited and when the money was to be deposited. He had direct communication with Nzeribe for multiple offences.
Unlike other members of the syndicate, there was less risk of being detected as the money was not deposited directly into his account from victims of the BECs. The length of time over which he participated was extensive. Mr Crawford-Fish acknowledges that in his offending the offender was answerable to Nzeribe.
It is clear that he participated in both the romance schemes and the BECs for financial reward. He spent the money received into his account on daily expenditure and transferred money overseas and he told police that he sent the money through Bitcoin because that was the only way to transfer it to Nigeria. The offender accepts that $253,000 in Bitcoin sent to Nigeria were purchases of cryptocurrency from the proceeds of the BECs and the romance scams.
It was clearly a money laundering syndicate with a high degree of sophistication. Members of the syndicate used a number of means to conceal the source of the proceeds received from the commission of the frauds, they used numerous account holders, used handlers to recruit and communicate with the account mules and shortly after the money was deposited into an account holder's account it was used to purchase either gold bullion or foreign currency with smaller amounts withdrawn in cash. The syndicate sent proceeds to Nigeria using a number of means, including Bitcoin and members of the syndicate communicated through numerous encrypted services including WhatsApp, Signal and Snapchat.
As to the period of involvement, the offending occurred between August 2018 and July 2020. The offender was an indispensable element in the money laundering syndicate whose ultimate purposes included the transfer, by clandestine means, a very substantial amount of proceeds from both types of scams.
In short, he occupied a highly valued role in a well-organised and sophisticated money laundering syndicate through which he dealt with over $800,000 worth of deposits.
Money laundering is, of course, a very serious offence because of the assistance it provides to organised criminal activity and the person who launders money is an important cog in the wheel of organised crime. Such conduct warrants severe punishment in which general deterrence is to be given significant weight.
It is clear that offences being committed while on conditional liberty is an aggravating factor. He was on either community corrections order or conditional bail.
As I have indicated I accept the offender's submission that the offending is not aggravated by the level of systematic dishonesty and planning which was no more than might be expected in the commission of a money laundering offence. The Crown does not put that committing the offence for financial gain was an aggravating factor under s 21A of the Crimes (Sentencing Procedure) Act 1999 in that it is an inherent characteristic of the offending, but the Crown does point to it as relevant to objective seriousness in the way that I have indicated.
I accept the expressions of remorse or regret proffered by the offender in evidence and I note the pleas of guilty in circumstances to which I have referred. I accept that his desire to reconnect with and support his family is a prosocial influence and with an appropriate level of supervision, prospects of reoffending should be low, as assessed by the author of the sentence assessment report.
I accept that there is a basis for a finding of special circumstances, it not being challenged by the Crown due to the fact that this is his first time in custody, his relative age, the ongoing restrictions due to the COVID pandemic and the need for continued mental health and relapse prevention counselling on release.
Mr Crawford-Fish set out a helpful table over three pages in an attempt to provide a favourable comparison with the sentence imposed by Pickering SC DCJ in R v Salame (unreported, NSWDC, 1 April 2021). Favouring Mr Ogbeide is his s 23 assistance and favouring Ms Salame was her prior good character and that she was not on conditional liberty at the time of the offending. Notwithstanding those differences, a degree of correlation lies in the number of offences, their objective seriousness, the roles played and the period over which they were committed. Mr Crawford-Fish submits that any significant disparity of sentence is likely to give rise to a justifiable sense of grievance.
The role of Salame described by Pickering SC DCJ was a facilitative role, in that she played a key role in facilitating the commission of the business email compromises by sourcing destination bank accounts and linking with the syndicate members who perpetrated the invoice frauds. Her role was significant and placed her in positions where she was communicating with those higher up in the syndicate. She remained answerable to the alleged director, as seen by her message to Nzeribe.
The subjective considerations of Salame, as summarised in the table, as being that at the time of the offending she was going through traumatic things in her life in relation to the family tragedy of her brother, the divorce, the sexual assaults that she had suffered, a pain management issue she was dealing with and her judgment was impacted particularly by the use of drugs to deal with that pain. The total amount of money involved in Ms Salame's offences was $903,964. Pickering SC DCJ said that her moral culpability was high, as is the offender's here.
Having dealt with the objective seriousness of the offending his Honour noted that of course just dealing with objective seriousness does not tell you what the ultimate sentence is. In Salame's case there was a difficult subjective case to consider. She was a person of prior good character. There was a basis of accepting the submission that her moral culpability was reduced as a result of the subjective matters, which were summarised by his Honour and his Honour accepted that general deterrence should be reduced for an offender of her nature, because of what she was going through. His Honour took into account that hardship would be involved in her being absent from her young daughter if her mother went into custody, as his Honour noted at 19,
That is not to say, however, that inevitably, when there is a mother of a young child being sent to custody, that is it is not a relevant consideration on sentence. It is. It is relevant in the consideration of the appropriate penalty …
…
There is no doubt that one of the worst aspects of any sentencing, whether is be a father or mother, is to put someone in custody away from their child. But consistent with the law , it wouldn't also be right that people who have children are dealt with differently to offenders who do not have children who commit the same offence. That is part of the logic behind hardship to third parties not being given excess weight in sentence porceedings.
Pickering SC DCJ describes Salame as not at the bottom of the hierarchy but not at the top either. She did not receive any significant individual benefit from it but her offending involving nearly a million dollars worth of proceeds of crime.
Mr Ogbeide was also not the principal; he was taking direction from Nzeribe. But he was, as I have indicated, a critical player in the syndicate.
The Crown has helpfully summarised the principles in relation to parity, set out by the High Court in Lowe v The Queen (1984) 154 CLR 606 and Postiglione v The Queen (1997) 189 CLR 295 and Green v The Queen (2011) 244 CLR 462.
As the Crown notes, while both Salame and the offender were involved in the same syndicate they were, to a significant extent, involved at different times and do not share any common BEC offences. Pickering SC DCJ determined that while Salame was more than a mule or an account holder who received money directly into their account, she was not one of the architects of the fraudulent invoices scheme and she was not one of the major players.
The Crown submits that this offender's role within the syndicate was higher than the role which Pickering SC DCJ assessed in relation to Salame for the following reasons:
His role as a conduit meant that he had access to and communicated with a greater number of more senior people within the overall hierarchy.
He communicated with people conducting the BECs, whereas Salame dealt with participants at the bottom of the overall hierarchy, namely, the account holders.
Both the offender and Salame dealt directly with Nzeribe.
In this offender's role as a conduit he had access to direct information regarding the BECs, including the invoices or emails sent and received by the victims of the fraud. He was trusted with knowledge about the quantum of money to be deposited and when the money was due to be deposited, which he passed onto Nzeribe. He was involved in sending proceeds from the offences to Nigeria and using Bitcoin. He was involved in communicating with Nzeribe in relation to a greater volume of account holders, compared to Salame.
The WhatsApp chat log between Ogbeide and Nzeribe as detailed at [57] -[58] of the agreed facts show that monetary figures alleged to be the proceeds of crime were also discussed in these exchanges, which investigators conservatively estimate at $2 million between February 19 and April 2020.
While Salame dealt with a total of $903,000; $396,000 out of that was not able to be utilised by the syndicate because the funds were frozen and reversed before they could be used by the offenders. As Pickering SC DCJ noted, the actual loss suffered is a factor that can be taken into account, while it does not necessarily reduce moral culpability of Salame, In relation to the $802,000 that the offender dealt with, the syndicate was able to utilise the majority of the funds, apart from the minor amount of $919 set out in [64].
The Crown submitted that the offender sought to minimise and understate his role and the extent of the financial reward. An example of this included his original evidence that he stopped communicating with Nzeribe for a number of months after receiving a CCO on 9 May. He later accepted in cross‑examination that the agreed facts showed that he had been communicating with Nzeribe by 11 June 2019 and accepted in his evidence that there may have only been a one week gap in those communications.
He originally told Community Corrections that he received only $10,000 to $15,000. He corrected this in evidence to say it was $10,0000 to $30,000 and then he accepted that he received 10% of the $800,000 dealt with. So even on his own evidence he was accepting that he received 10% of the proceeds of the scams, which was about $80,000 and about $26,000 a year in cannabis and alcohol, when he was out with Nzeribe and luxury clothes items that Nzeribe did not want. The offender said in his evidence that he had received $140,000 from his parents at the time these offences were being committed. There is no objective evidence to support that. It is a matter about which I simply cannot make a finding.
The Crown submits that the subjective circumstances for this offender are less compelling than the subjective circumstances for Salame. As I have indicated, his Honour made a very significant adjustment to the statutory ratio in that case. I generally accept the Crown's submissions on the parity question.
I also, of course, have to take into account principles of totality as summarised in the judgment in the Court of Criminal Appeal in R v XX (2009) 195 A Crim R 38 The ultimate sentence to be served by the offender must reflect the total criminality of the offences committed and there is some accumulation appropriate to reflect the totality of his conduct and the gravity of the offences.
The orders that I make are as follows:
1. The offender is convicted of each offence.
2. Taking into account a 25% discount for the pleas of guilty and 10% discount for past assistance, the indicative sentences are:
1. Sequence 1, 18 months.
2. Sequence 2, 15 months.
3. Sequence 3, 15 months.
4. Sequence 10, taking into account the Form 1 matters: 31 months.
5. Sequence 14, 16 months.
6. Sequence 8, 18 months.
1. I impose an aggregate sentence of three years and ten months imprisonment commencing 25 June 2020.
2. I impose a non-parole period of two years and one month expiring 24 July 2022.
3. I find special circumstances.
Note - These extempore remarks were revised without access to the court file.
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Decision last updated: 10 March 2022