Regina v Cooper [2006] NSWSC 609 | Case summary

Regina v Cooper [2006] NSWSC 609 | Case summary | Zoe

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SENTENCE 1 HIS HONOUR: On 31 October 2005, after a trial presided over by me, the jury found the prisoner Bradley David Cooper guilty on all of the thirteen counts in the indictment which had been presented against him. 2 The first count in the indictment charged the prisoner with having on 3 December 2000 corruptly offered to give William Herbert Howard an agent of HIH Casualty & General Insurance Limited (to which I will refer as "HIH C&G") a benefit, namely cash and employment by a company associated with the prisoner, the expectation of which would tend to influence Mr Howard to show favour to companies associated with the prisoner in relation to the affairs of HIH C&G, namely in the processing of claims by those companies. 3 Each of counts 2 to 6 in the indictment charged the prisoner with having corruptly given Mr Howard a benefit, namely an amount of cash, the receipt of which by Mr Howard would tend to influence Mr Howard to show favour to companies associated with the prisoner in the manner alleged in the first count. 4 The offences charged in the first six counts in the indictment were all offences under s 249B(2)(b) of the Crimes Act for which the maximum penalty is imprisonment for seven years. These offences can conveniently be referred to as "the bribery offences". 5 In each of the remaining counts in the indictment, that is counts 7 to 13, the prisoner was charged with having published a statement to HIH C&G which he knew to be false in a material particular, with the intent to obtain a financial advantage for another person, being a company associated with the prisoner. The offences charged in counts 7 to 13 were all offences under s 178BB of the Crimes Act for which the maximum penalty is imprisonment for five years. These offences can conveniently be referred to as "the false statement offences". 6 The proceedings for the sentencing of the prisoner have been protracted, due mainly to the desire of the parties to collect and adduce evidence for the proceedings on sentence beyond the evidence given in the trial, to put detailed written submissions on sentence and to put oral submissions on sentence. On 2 December 2005 the Crown Prosecutor handed up lengthy written submissions and made oral submissions. On 30 March 2006 counsel for the prisoner tendered certain documentary evidence, referred to written submissions which had been lodged and made oral submissions. On 19 May 2006 counsel for the prisoner tendered further documentary evidence and made further oral submissions. I received written submissions from the Crown in reply to the prisoner's written submissions. 7 The prisoner, who had previously been on bail, went into custody on 31 October 2005 after the jury returned their verdicts of guilty and he has since remained in custody as a remand prisoner. 8 The prisoner did not give evidence at the trial and did not give evidence in the proceedings on sentence. 9 As the sentencing judge it is part of my function to determine the facts relevant to sentencing for each of the offences for which the prisoner is to be sentenced. I am mindful that facts adverse to the prisoner must be proved beyond reasonable doubt, whereas facts favourable to the prisoner need only be proved on the balance of probabilities. It may be the case that on some matters the evidence available to me does not permit me to make any finding.

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Facts Relevant to the Offences Companies and Individuals 10 HIH Insurance Limited (which I will refer to as "HIH") was a large insurance company. HIH C&G was a member of the HIH group of companies. HIH C&G held the bank accounts of the HIH group of companies, so that if any claim made by a company associated with the prisoner against HIH was settled on terms requiring the payment of money to a company associated with the prisoner, that payment would be made by HIH C&G. 11 Up until some time in December 2000 Mr Ray Williams was the Chief Executive Officer of HIH. In December 2000 Mr Williams was replaced as Chief Executive Officer of HIH by Mr Randolph Wein. 12 Mr William Howard, the person referred to in the bribery offences, who had been the General Manager Finance for the HIH group became in December 2000 the Chief Investment Officer of the HIH group. Mr Howard's employer was HIH C&G. 13 The prisoner was not at any time a director or an officer or an employee of HIH or of any other company in the HIH group. 14 In late 2000 and early 2001, as both the prisoner and Mr. Howard knew, HIH was in serious financial difficulties, including being seriously short of cash. Mr. Howard knew that his continued employment by HIH C&G was in jeopardy. On 15 March 2001 a provisional liquidator of HIH was appointed. 15 In 1999 HIH had taken over a company FAI Insurances Limited (which I will refer to as "FAI Insurances"). Before the takeover Mr Rodney Adler had been the Chief Executive Officer of FAI Insurances. After the takeover Mr Adler became a director of HIH. 16 A company particularly associated with the prisoner was FAI Home Security Pty Limited, (which I will refer to as "FAI Home Security"). FAI Home Security carried on the business of selling alarm systems to businesses and households. The alarm systems which FAI Home Security sold were manufactured by a company named Ness Security Products Pty Limited, (which I will refer to as "Ness"). The prisoner was the Chief Executive Officer of FAI Home Security. 17 In late 2000 and early 2001 FAI Home Security was a wholly owned subsidiary of a company incorporated in a state of the United States named Home Security International Incorporated (which I will refer to as "HSI"). The prisoner was the Chief Executive Officer of HSI, apart from a period between September and November 2000 during which Mr Adler was its Chief Executive Officer. As a result of the takeover of FAI Insurances by HIH, HIH acquired a large shareholding in HSI. 18 Another company was FAI Finance Corporation Pty Limited, (which I will refer to as "FAI Finance Corporation"). FAI Finance Corporation carried on the business of financing credit purchases of alarm systems from FAI Home Security. The General Manager of FAI Finance Corporation was Mr. Jeffery Jurd. 19 Over the years there were a number of changes in the shareholding in FAI Finance Corporation. Prior to February 1995 FAI Home Security had held shares in FAI Finance Corporation but in February 1995 FAI Home Security disposed of the shares it had been holding in FAI Finance Corporation and FAI Home Security did not again hold any shares in FAI Finance Corporation until December 1997. In 1999, after the takeover of FAI Insurances by HIH, 50 per cent of the shares in FAI Finance Corporation were held by or on behalf of HIH and 50 per cent of the shares were held by FAI Home Security. In about March 2000 HIH or another company in the HIH group acquired from FAI Home Security 50 per cent of the shares in FAI Finance Corporation, so that from then on all the shares in FAI Finance Corporation were held by or on behalf of HIH. 20 Other companies associated with the prisoner were Vision Publishing Pty Limited (which I will refer to as "Vision Publishing"), the Goodwill Group Pty Limited and Speak Easy Pty Limited. The prisoner beneficially owned all of the shares in the Goodwill Group Pty Limited and Speak Easy Pty Limited. Vision Publishing was a wholly owned subsidiary of the Goodwill Group Pty Limited. 21 A consequence of the takeover of FAI Insurances by HIH was that HIH was brought into various business relationships with the prisoner and companies associated with him, which had been in certain business relationships with FAI Insurances. 22 Towards the end of the year 2000 HIH was working towards what was described at the trial as a "divorce" or separation between HIH, on the one hand, and the prisoner and his companies, on the other hand. Particular matters to be resolved as part of the divorce included that HIH wished to purchase the right to use the name "FAI", the prisoner wished to acquire the shares in HSI which were held by HIH and a number of claims which the prisoner had made against HIH on behalf of companies associated with him. Mr Howard was authorised by Mr Williams and Mr Adler to deal with the prisoner with respect to these matters.

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The Bribery Offences 23 On Sunday 3 December 2000 the prisoner and Mr Howard had a meeting at a suburban hotel. The meeting had been arranged by the prisoner. No one else was present at the meeting. 24 At the meeting the prisoner produced a memorandum dated 21 March 2000 from Mr Colin Richardson, a consultant who was then working for HIH. The memorandum had been sent by Mr. Richardson to the prisoner. In the memorandum Mr Richardson set out his understanding of "the revised proposal regarding the purchase by HIH of FFC (that is the purchase by HIH of shares in FAI Finance Corporation) and other matters". The final paragraph of this memorandum reads:- "As a separate matter, HIH has agreed to sponsor the forthcoming seminars to be produced by Vision (that is Vision Publishing) in an amount of $1,200,000. Details of this sponsorship will need to be finalised directly with HIH". 25 At the meeting on 3 December 2000 the prisoner complained to Mr Howard that the agreement to sponsor the seminars had not been honoured. 26 At the meeting the prisoner said to Mr Howard that, if Mr Howard helped the prisoner to get outstanding issues sorted out, he would "look after" Mr Howard. The prisoner explained what he meant by "looking after" Mr Howard, by saying that he would pay Mr Howard cash and that there would be a position available for Mr Howard at HSI. Mr Howard said that he would prefer cash. The prisoner said that cash would be easy for him. The prisoner said that, when Mr Howard settled the Vision Publishing claim, the prisoner would arrange a payment for him. 27 This conduct by the prisoner on 3 December 2001 was the basis of the first count in the indictment. By returning a verdict of guilty on count 1 the jury showed that they were satisfied beyond reasonable doubt that the offer alleged in count 1 had been made by the prisoner, that the expectation of the benefit offered would have had a tendency to influence Mr Howard to show favour to companies associated with the prisoner in the processing of their claims and that the offer was made corruptly, that is with an intention on the part of the prisoner to influence Mr Howard to show favour to companies associated with the prisoner. 28 Subsequently, the prisoner communicated from time to time with Mr Howard concerning claims by one or other of the prisoner's companies against HIH. In order to give the appearance to other persons, including other officers or employees of HIH or HIH C&G, that Mr. Howard was dealing with the claims in good faith, it was agreed between the prisoner and Mr Howard that a procedure would be followed in relation to each claim, whereby the prisoner would submit a claim with supporting documents, there would be negotiations between the prisoner and Mr Howard, a settlement would be arrived at for an amount lower than the original amount of the claim and the settlement amount would be paid. This procedure was carried out in relation to a number of claims. It will be necessary to refer to a number of these claims in detail later in these remarks. 29 Pursuant to the offer made on 3 December 2000, the prisoner made five payments of cash to Mr Howard. 30 On or about 22 December 2000 at the prisoner's office at North Sydney the prisoner handed Mr Howard an envelope containing approximately $20,000 in cash, saying "here's a Christmas present". This payment was the subject of the second count in the indictment., 31 The payment which was the subject of the third count in the indictment was a payment of approximately $30,000 in cash made by the prisoner to Mr Howard at the Ritz Carlton Hotel in the city. In his evidence at the trial Mr Howard could not recall whether this payment, or the payment charged in the fifth count, was the second payment made to him by the prisoner. If this payment of $30,000 was the second payment, it was made in January 2001. If it was not the second payment, it was made in February 2001. At the Ritz Carlton Hotel the prisoner and Mr Howard sat at a table in a bar and cash was transferred from a bag the prisoner had to a bag Mr Howard had. 32 Mr Howard spent a holiday at Noosa in Queensland between 18 January 2001 and 27 January 2001. While he was on holiday at Noosa, a third payment of approximately $9,000 in cash was made to Mr Howard at the resort at which he was staying. A difference between this payment and the other payments is that the payment was made, not by the prisoner personally, but by an intermediary on behalf of the prisoner, who, acting quite innocently, handed over an envelope to Mr Howard which contained the cash. This payment was the subject of the fourth count in the indictment. 33 The payment which was the subject of the fifth count in the indictment was a payment of approximately $40,000 in cash made by the prisoner to Mr Howard at the Sheraton on the Park Hotel in the city. If this payment was the second payment made by the prisoner, it was made in January 2001; if it was the fourth payment, it was made in February 2001. On this occasion the prisoner picked up Mr Howard in his Ferrari vehicle, drove to the Hotel and in a lounge in the Hotel the prisoner handed Mr Howard an envelope containing approximately $40,000 in cash. 34 The payment which was the subject of the sixth count in the indictment was made in early March 2001 at the prisoner's residential apartment at Balmoral. The prisoner took cash out of a drawer and handed Mr Howard either $25,000 or $20,000 in cash. 35 The total amount of cash paid by the prisoner to Mr. Howard was approximately $124,000 or approximately $119,000. 36 On the Crown case at the trial the individual payments made by the prisoner to Mr Howard were not necessarily specifically linked to the settlement by Mr Howard of any particular claim made on behalf of a company associated with the prisoner and in some cases were linked to the settlement of a number of claims. 37 By returning verdicts of guilty on all of counts 2 to 6, the jury showed that, on each count, they were satisfied beyond reasonable doubt that the payment alleged by the Crown had been made, that the payment would have had the requisite tendency to influence Mr Howard and that the payment had been made by the prisoner corruptly. The False Statement Offences

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Counts 7 - 10 38 As stated earlier in these remarks, at the meeting on 3 December 2000 the prisoner complained to Mr Howard that HIH had not honoured the agreement recorded in the final paragraph of Mr Richardson's memorandum of 21 March 2000 to pay $1.2m by way of sponsoring seminars to be produced by Vision Publishing. 39 In December 2000 the prisoner proposed that this claim by Vision Publishing against HIH for $1.2m be satisfied, by offsetting against it amounts owing by the Goodwill Group Pty Limited to FAI Finance Corporation under two factoring agreements, leaving a balance of $347,500 to be paid to Vision Publishing. 40 To give the appearance that he had been diligently pressing the claim for some months, the prisoner in December 2000 fabricated four letters from Vision Publishing to HIH bearing the dates 12 May 2000, 16 August 2000, 4 October 2000, and 21 November 2000. 41 The proposal made by the prisoner for settlement of the claim was accepted by Mr Howard. On 8 December 2000 a cheque for $347,500 was drawn by HIH C&G in favour of Vision Publishing and by 11 December 2000 (which was the next working day) that cheque had been paid. 42 At some time between 8 December 2000 and 15 December 2000, in a conversation between the prisoner and Mr Howard, the prisoner, in the context of discussing Vision Publishing, asked Mr Howard "does Ray know?" Mr Howard replied, "no, he doesn't". The idea had occurred to the prisoner that Mr Ray Williams might be unaware that the Vision Publishing sponsorship undertaking had been discharged, particularly as the discharge had been effected by the indirect method of an offsetting agreement and a payment of the balance, and that, if Mr Williams was unaware that the undertaking had already been discharged, the prisoner should try to obtain a second performance of the Vision Publishing undertaking. 43 Mr Howard, of course, was fully aware that the Vision Publishing sponsorship undertaking had already been satisfied in full. However, as a result of the corrupt offer which had been made to him by the prisoner, Mr Howard acquiesced in the prisoner obtaining, and actively assisted the prisoner to obtain, a second performance of the Vision Publishing undertaking. 44 On 15 December 2000 the prisoner sent a facsimile transmission to Mr Howard, enclosing a letter from the prisoner to Mr Williams, to which was attached a copy of Mr Richardson's memorandum of 21 March 2000. Although the facsimile transmission to Mr Howard and the letter to Mr. Williams bore the date 6 December 2000, the transmission confirmation sheet shows that the fax was actually sent on 15 December 2000. 45 In the letter to Mr Williams the prisoner said that all outstanding issues had been finalised, except for one issue. The one outstanding issue was said to be the undertaking by HIH to sponsor the Vision Publishing seminars. The prisoner asserted "Vision has not to date received its $1.2m as agreed by you via Colin Richardson. In order to protect Vision's interests I need this outstanding sum paid now". The statement "Vision has not to date received its $1.2m as agreed by you" was the false statement alleged in count 7 in the indictment. 46 Although such a statement would have been true as at 6 December 2000, the date borne by the facsimile transmission, it was false as at 15 December 2000, the date on which the statement was published by the sending of the facsimile transmission, because the undertaking to pay Vision Publishing $1.2m had been satisfied in full by 11 December 2000. On 15 December 2000 the prisoner, knowing that the claim by Vision Publishing for $1.2m had already been satisfied, falsely claimed that it had not been paid and sought to obtain a further payment of the sum of $1.2m. 47 On 20 December 2000 the prisoner sent a facsimile transmission to Mr Howard dated 20 December 2000, in which he responded to a letter dated 19 December 2000 from Mr Howard. In paragraph 17 of this facsimile transmission the prisoner said:- "Although not on your list, I plan to settle the $1.2m sponsorship agreement, which will make a very big difference to my personal cash flow". 48 The statement in the facsimile transmission "I plan to settle the $1.2m sponsorship agreement" was the false statement alleged in count 8 of the indictment. The statement was false, in that it represented that the undertaking to pay the $1.2m sponsorship was still outstanding, whereas the undertaking had been satisfied in full by 11 December. Mr Howard, of course, was aware that the sponsorship claim had already been satisfied. However, the prisoner intended that the false statement in the facsimile transmission to Mr. Howard would be used to deceive other officers or employees of HIH or HIH C&G. 49 Mr Howard returned to work after the Christmas holidays on 3 January 2001. On 3 January 2001 the prisoner told Mr Howard that he was going to contact Mr Williams with regard to Vision Publishing and he told Mr Howard to send a memorandum to Mr Williams, stating that the Vision Publishing sponsorship claim was still outstanding. The prisoner and Mr Howard collaborated in drafting the terms of a memorandum to be sent by Mr Howard to Mr Williams. 50 This memorandum was sent to Mr Williams on 3 January 2001. The subject of the memorandum was stated to be "Vision Publishing $1.2m". In paragraph 1 of the memorandum Mr Howard said:- "I have been asked by Brad Cooper (many times) for the finalisation of this issue as part of the agreement to finalise all matters between HIH and HSI".

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A copy of Mr Richardson's memorandum of 21 March 2000 was attached to this memorandum. 51 The memorandum, which was sent to Mr Williams at the instigation of the prisoner and in the drafting of which he had participated, was clearly intended by the prisoner to deceive Mr Williams into believing that the Vision Publishing sponsorship claim of $1.2m was still outstanding. 52 After receiving the facsimile transmission, Mr Williams wrote a letter to Mr Howard. In the letter Mr Williams gave Mr Howard a short history of the Vision Publishing sponsorship matter, as Mr Williams knew it. It is obvious from the terms of the letter that Mr Williams was quite unaware that the Vision Publishing sponsorship claim had already been satisfied. In his letter Mr Williams advised Mr Howard "clearly we cannot pay over a sponsorship fee, without the full details of what is now proposed and, most importantly, when the event will be staged". 53 On 5 January 2001 the prisoner and Mr Howard purported to settle the Vision Publishing sponsorship claim for $750,000. Both the prisoner and Mr Howard knew that the claim had already been settled but they engaged in the charade of purporting to settle the claim for part of the amount claimed by the prisoner. Some attempt was made to make it appear that the claim was a genuine claim, separate from the claim by Vision Publishing which had already been settled, by describing the claim as being a claim by the Goodwill Group Pty Limited. 54 On 8 January 2001 a facsimile transmission was sent on behalf of the prisoner on the letterhead of the Goodwill Group Pty Limited. I am satisfied that this facsimile transmission, like all other facsimile transmissions or letters from the prisoner's office, whether or not they were signed by the prisoner, was sent with the prisoner's authority. 55 Enclosed with this facsimile transmission was an invoice dated 27 December 2000 for "the full amount of the sponsorship package and consultancy fees for the years 2000 and 2001". The amount of the invoice was $825,000, which was made up of $750,000 plus GST at 10 percent. The invoice stated that $450,000 was immediately payable and that the balance of $375,000 was payable within four months. 56 In the facsimile transmission with which the invoice was enclosed it was stated "since this amount is extremely overdue, could you please make the necessary arrangements to transfer the funds directly into our bank account". 57 This statement that the amount of the invoice was extremely overdue was false, in that the amount of the invoice was not overdue or due at all. This false statement was the subject of the ninth count in the indictment. 58 Mr. Howard arranged for the amount of $412,500, being half of $825,000, to be promptly paid by HIH C&G to the Goodwill Group Pty Limited. 59 In a memorandum of 12 January 2001 to the prisoner Mr Howard said that HIH might make the final payment earlier than in four months, if the prisoner was prepared to accept a discounted amount. 60 On 15 January 2001 the prisoner sent a memorandum to Mr Howard. The memorandum began "I have received your letter confirming the amount of $375,000 owing by HIH to me". This statement was false, in that no money at all was owing. This false statement was the subject of the tenth count in the indictment. 61 The prisoner agreed that the final payment to be made could be discounted, provided that it was paid immediately. Mr. Howard arranged for a discounted final payment of $325,000 to be made by HIH C&G to the Goodwill Group Pty Limited. Counts 11 and 12 62 For some years up to September 1998 a mutual association Credit Reference Australia provided to its members information about the credit standing or credit worthiness of persons with whom members proposed to do business. 63 In about September 1998 Credit Reference Australia demutualised , that is, converted itself into a company limited by shares, which was called Data Advantage Limited. 64 Shares in Data Advantage Limited were allocated to persons or companies who had been members of Credit Reference Australia. There was a basic allocation of 500 shares in Data Advantage Limited to every person or company who had been a member of Credit Reference Australia. Further shares were allocated to persons or companies who had been members of Credit Reference Australia, on the basis of one share for every dollar a member had been invoiced by Credit Reference Australia over the three years between 1 October 1994 and 30 September 1997. 65 A total number of 290,363 shares in Data Advantage Limited were allocated to FAI Insurances. 217,009 of those shares were referable to amounts for which FAI Finance Corporation had been invoiced by Credit Reference Australia between 1 October 1994 and 30 September 1997. 66 The prisoner claimed that some of the shares in Data Advantage Limited which had been allocated to FAI Insurances should have been received by FAI Home Security, on the grounds that between 1 October 1994 and 30 September 1997 shares in FAI Finance Corporation had been held by FAI Home Security. 67 In early January 2001 the prisoner asked Mr Howard why his Data Advantage claim had not yet been settled. 68 On 7 January 2001 the prisoner was staying at Hayman Island. He was not on holidays; he was working. 69 On or about 15 January 2001 Mr Howard was flown up to Hayman Island at the prisoner's expense. At Hayman Island the prisoner demanded to know why his Data Advantage claim had not been settled. Mr Howard said that he would need to see documentation in order to assess the claim. The prisoner said that he was having the whole file on the Data Advantage claim forwarded up to him from Sydney and, in particular, he was trying to find a letter from Mr Rodney Adler, which he said confirmed the entitlement of FAI Home Security to a large proportion of the shares in Data Advantage Limited which had been allocated to FAI Insurances. Mr Howard returned to Sydney. 70 The prisoner sent a facsimile transmission to Mr Howard dated 15 January 2001, which had many attachments. In the facsimile transmission the prisoner claimed that 85 per cent of the shares allocated to FAI Insurances were the property of HSI, "because we owned the company (FAI Finance Corporation) for 85 per cent of the period that the benefit was gained". In this facsimile transmission the prisoner was not seeking to draw any distinction between HSI and FAI Home Security. In the facsimile transmission the prisoner claimed that he had spoken to Mr Adler and that Mr Adler was in total agreement with the prisoner. 71 After Mr Howard returned from his holiday at Noosa the prisoner told him in a telephone conversation that the prisoner had "retrieved from archives the letter from Rodney Adler confirming that the Data Advantage shares should have been transferred to FAI Home Security". 72 On 30 January 2001 the prisoner sent a facsimile transmission to Mr Howard. The facsimile transmission commenced:- "The attached letter retrieved from archives… completes your file… the file and all correspondence clearly confirms HIH have an asset in Data Advantage shares of which 80 per cent belongs to HSI". 73 The attached letter said to have been retrieved from archives was a letter bearing a date 2 August 1999, signed by Mr Rodney Adler. The letter was in the following terms:- "Further to our telephone conversation to-day, I have, as requested, reviewed the entire file in regard to FFC (FAI Finance Corporation) and the Data Advantage issue. It is as I thought, without question, an oversight on our part. Understanding that this is a material issue to HSI, I am pleased to once again re-confirm that FAI Insurance should have reallocated a large percentage of the value of the Data Advantage shares that were issued to FAI (Insurances), not redistributed back to FFC and per the activity report from Data Advantage which clearly confirms that these shares were the property of FFC and based on pro rata activity HSI should have immediately received the value of this asset. This is an internal error but obviously self-explanatory when one looks at the file. Please feel free to include the above in your audit or end of year profit calculations. This should resolve the issue for once and for all as it previously, and still does, have my full approval". 74 It is convenient to refer to this letter as "the Adler letter". 75 At the trial the Crown proved that the only reasonable conclusions to be drawn from a number of circumstances were that the Adler letter, so far from being a genuine letter brought into existence on or about 2 August 1999 and retrieved from archives, had been created at the instance of the prisoner in January 2001; that on 24 January 2001, on the instructions of the prisoner, the letter had been faxed by a personal assistant of the prisoner to Mr Adler for signature by Mr Adler; that the letter had been signed by Mr Adler and returned on 29 January 2001; that the signed letter had been copied, with care being taken to mask a fax imprint so as not to disclose that the letter had only just been received from Mr Adler; and that the copy of the letter had then been forwarded to Mr Howard with the facsimile transmission of 30 January 2001. 76 The statement in the facsimile transmission of 30 January 2001 to Mr Howard that the attached letter had been retrieved from archives was false and is the subject of the eleventh count in the indictment. 77 The prisoner sought legal advice in relation to the Data Advantage claim from Mr Simon Rofe, solicitor, of Browne and Co Solicitors. Instructions were given to Mr Rofe on 7 February 2001 and a written advice was received from Mr Rofe the same day. Unsurprisingly, in view of the instructions Mr Rofe was given about the facts, Mr Rofe's advice was favourable to the prisoner. On 7 February 2001 a copy of Mr Rofe's advice was sent by the prisoner to Mr Howard. 78 In his written advice of 7 February 2001 Mr Rofe said inter alia:- "On 2 August 1999 agreement was reached between yourself and Rodney Adler (representing FAI Insurances) that 80 per cent of the gross value of these shares would be paid by FAI Insurance to FHS (FAI Home Security) to rectify this situation and in recognition that FHS ought to have received its pro rata share of the value of the Data Advantage shares when initially allocated". 79 The statement that on 2 August 1999 agreement had been reached between the prisoner and Rodney Adler was false, because no such agreement had been reached. 80 This statement was, of course, contained in an advice by Mr Rofe and not in a letter or facsimile transmission from the prisoner. However, by sending a copy of Mr Rofe's advice to Mr Howard, the prisoner published to HIH and HIH C&G the statement in the advice. 81 Mr Rofe, obviously, did not have any independent knowledge of whether such an agreement had been made between the prisoner and Mr Adler. In stating in his advice that such an agreement had been made Mr Rofe was simply repeating instructions he had received, directly or indirectly, from the prisoner. 82 This false statement in Mr Rofe's advice, which was published by the prisoner to HIH C&G, is the subject of the twelfth count in the indictment. 83 Just before Mr Howard left on an overseas business trip to the United States on 14 February 2001 the prisoner and Mr Howard had a conversation in which it was agreed that the Data Advantage claim would be settled for $1m. When Mr Howard arrived at his hotel in San Francisco, there was a fax from the prisoner waiting for him, demanding payment of the $1m by the end of the week. Mr Howard gave instructions to a member of the HIH staff in Sydney to arrange payment of $1m and the payment was made.

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Count 13 84 In February 2001 HIH held 126,000 shares in a company called Publicard Inc. Publicard was an American company listed on the NASDAQ Stock Exchange in America. 85 On 23 February 2001 the prisoner sent a facsimile transmission to Mr Howard. In this facsimile transmission the prisoner said:- "This letter is to confirm that I offer to purchase your entire shareholding in Publicard. The stock is down some 78 per cent from its year high and falling significantly on a daily basis. My offer is to pay 65 per cent of to-day's value, with an immediate cash payment (payable by courier to-day) for your 126,000 shares, the value being $163,800. Would you please confirm your immediate acceptance by signing and returning by facsimile". 86 It is to be noted that in the fax there is a dollar sign before the figure 163,800 but no symbol indicating whether American dollars or Australian dollars are meant. In February and March 2001 the Australian dollar was worth only just over half an American dollar, so that there would have been a considerable difference between 163,800 American dollars and 163,800 Australian dollars. 87 After receiving this facsimile transmission from the prisoner, Mr Howard made an inquiry and ascertained that the current value of a share in Publicard was 2 US dollars. 88 Mr Howard decided to accept the prisoner's offer. He wrote on a copy of the facsimile transmission "accept US$1.20 @ 0.525 exchange rate = A$288,000" and he faxed this copy of the prisoner's facsimile transmission back to the prisoner. 89 The figure of .525 written by Mr Howard was the current exchange rate of the Australian dollar with the American dollar. However, in calculating the amount of the prisoner's offer in Australian dollars, Mr Howard had made an arithmetical error. Sixty-five per cent of the current value in American dollars of $2 would have been $1.30 American dollars and not $1.20 American dollars, with the consequence that the total of Australian dollars 288,000 was wrong. 90 Mr Howard's mistake in treating $1.20 as being 65 per cent of $2 was picked up by Ms Wanda Guff, an employee of HIH or FAI Insurances. Ms Guff saw Mr Howard about the mistake. Mr Howard corrected the figure "US $1.20" to "US $1.30" and Ms Guff altered the total to "A$ 312,000". The prisoner's office was notified that the amount of the prisoner's offer had been calculated by HIH to be A$ 312,000. 91 On 26 February 2001 Wanda Guff sent a fax to the prisoner on the subject of Publicard. In the first sentence of the fax she said "I've tried to ring you in regards to delivery of 126,000 shares in Publicard Inc for a consideration of $US 163,800". 92 Mr Premutico, a personal assistant of the prisoner, made notes for the prisoner, which were promptly submitted to the prisoner, including a note that on 26 February 2001 the prisoner's accountant Mr Ferguson had transferred $312,000 to HIH for the Publicard shares. 93 On 12 March 2001 the prisoner sent a facsimile transmission to Mr Howard. The first paragraph of the facsimile transmission began:- "As you know I purchased HIH's 120,000 shares in Publicard approximately 7 days ago. Call it my own naivety, but I was shocked to find out there was no market in the stock and that any attempt to resell these shares would force the price well below 1 dollar…" 94 It had become apparent to the prisoner that he had made a very bad investment in purchasing the Publicard shares. 95 In a telephone conversation with Mr Howard on 12 March 2001 the prisoner claimed, for the first time, that his offer had been to purchase the Publicard shares for $163,800 Australian dollars and not $163,800 American dollars. 96 On 13 March 2001 the prisoner sent a facsimile transmission to Mr Howard. In the facsimile transmission the prisoner claimed that "a most embarrassing situation has arisen. I have just reviewed my correspondence from last week and realised that my negotiation with you in regard to the Publicard purchase has gone horribly wrong". The prisoner stated that, having studied his letter of offer of 23 February 2001, "my offer outlined in paragraph 2 was to purchase your 126,000 shares in Publicard a NASDAQ listed stock at AUD 163,800". The prisoner claimed that his accountant Mr Ferguson had wrongly assumed that the handwritten notes on the letter of offer which had been made by Mr Howard were the prisoner's notes. The prisoner offered Mr Howard "the option of refunding me the difference being $AUD 148,200 or reversing the total transaction and refunding me $312,000". The prisoner apologised for what he said had been the confusion at his end and thanked Mr Howard for bringing the matter to the prisoner's attention. Mr. Howard had not brought the matter to the prisoner's attention. 97 The prisoner subsequently had a conversation with Mr Howard. In the conversation Mr Howard said, "I still think that we were talking US dollars". The prisoner said, "no way, my letter clearly says an A$ offer and my accountant has just made a mistake". The prisoner said, "you can have the shares back or refund the difference" Mr Howard said, "I don't want the shares back" and Mr Howard eventually said "I am tired of this and I will send you a refund". 98 A payment of $148,200 was made to the prisoner on 14 March 2001, the day before HIH went into provisional liquidation. 99 The statement in the facsimile transmission of 13 March 2001, "my offer outlined in paragraph 2 was to purchase your 126,000 shares in Publicard a NASDAQ listed stock at AUD $163,800" was false and was the false statement alleged in count 13 in the indictment. 100 There can be no doubt that, as the prisoner well knew, the offer made by the prisoner in his fax of 23 February 2001 was to pay US $163,800. 101 Publicard was an American company listed on an American Stock Exchange on which its price was quoted in American dollars and it would be natural for "to-day's value" to be the price in American dollars. 102 The value of Publicard shares in American dollars as at 23 February 2001, the date of the offer, was $2 and 65 per cent of that value per share, times 126,000 shares, would produce a figure of US$163,800, which was the amount of the offer stated in the prisoner's fax of 23 February 2001. 103 The fax sent by Ms Guff and the notes made by the prisoner's personal assistant confirm that the prisoner was well aware in February 2001 that the amount he had offered was $US 163,800. 104 It was absurd for the prisoner to claim, as he did in his fax of 13 March, that his accountant, who had worked for him for a number of years and who would have been familiar with his handwriting, had mistakenly assumed that Mr Howard's handwritten notes had been made by the prisoner. 105 Even the second limb of the offer made by the prisoner in his fax of 13 March, namely reversing the total transaction and refunding AUD $312,000, presupposed that the amount of the offer had been US $163,800. 106 Mr Howard well knew that the price offered and accepted had been $US 163,800. In the last conversation he had with the prisoner on this subject he said "I still think that we were talking US dollars". However, so compromised was Mr Howard by the bribes he had accepted, that he weakly submitted to the prisoner's absurd claim. 107 Although Mr Howard was not deceived by the false statement, the false statement was intended by the prisoner to deceive other officers or employees of HIH who in the course of their duties might see the facsimile transmission of 13 March.

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112 Before commencing my examination of the individual claims, I should refer to some general submissions made by counsel for the prisoner. 113 It was submitted by counsel for the prisoner that I should take into account that Mr Howard had been instructed to endeavour to achieve a divorce between HIH and the prisoner's companies, as soon as possible, and that I should find, as I do, that the prisoner was, quite apart from his criminal conduct, an aggressive and persistent negotiator. It was submitted that in these circumstances Mr Howard, even if he had not been bribed, might have settled claims by the prisoner's companies on terms which might appear favourable to those companies. I take these submissions by counsel for the prisoner into account. 114 It was also submitted by counsel for the prisoner that the funds provided to the prisoner's companies in settlement of their claims assisted FAI Home Security, which was in serious financial trouble, to survive, If FAI Home Security had not survived, there could have been adverse financial consequences for HIH. FAI Home Security had survived and had then been sold to the Chubb organisation. After the sale, monies which FAI Finance Corporation had advanced to FAI Home Security were repaid to FAI Finance Corporation, thereby benefiting HIH. 115 The Crown replied to these submissions by pointing out that between December 2000 and March 2001 HIH had itself been in grave financial difficulty, with a desperate shortage of cash. It was also submitted by the Crown that the claims the prisoner made on behalf of his companies were not put forward by him on the grounds that settling the claims would indirectly benefit HIH but on other, and, the Crown submitted, entirely spurious grounds. 116 It is very difficult for me, on the limited evidence available to me, to form any view on whether the payments made by HIH really contributed to the survival of FAI Home Security and whether, and, if so, to what extent, the survival of FAI Home Security was advantageous to HIH. I do, however, take these submissions into account. 117 I will deal first with the claims by the prisoner's companies which I have already considered in these remarks, that is the first Vision Publishing claim, the second Vision Publishing or the Goodwill Group claim, the Data Advantage claim and the Publicard claim. The First Vision Publishing Claim 118 As I have already stated earlier in these remarks, Mr Richardson in his memorandum of 21 March 2000 said that HIH had agreed to sponsor in the amount of $1,200,000 seminars to be produced by Vision Publishing. However, Mr Richardson added "details of this sponsorship will need to be finalised directly with HIH". 119 It is clear that no seminars were ever held and that no details of the sponsorship were ever finalised with HIH. 120 In his letter of 3 January 2001 to Mr Howard Mr Williams said, "clearly we cannot pay over the sponsorship fee without full details of what is now proposed and, most importantly, when the event will be staged". As I have already explained, unbeknown to Mr Williams, the sponsorship claim had already been discharged in full. However, Mr Williams' caveat against making any payment, unless full details of what was proposed were supplied to HIH, was in accordance with the addendum to Mr Richardson's memorandum and would, in any event, seem to me to be common sense. 121 I am satisfied that Mr Howard, if he had not been bribed, would not have agreed to pay any amount on the first Vision Publishing claim. The Second Vision Publishing or the Goodwill Group Claim 122 In the light of the jury's verdicts of guilty on counts 7 to 10, it was conceded by counsel for the prisoner in the proceedings on sentence that this claim was completely lacking in any foundation and known by Mr Howard to be completely lacking in any foundation. I find that Mr Howard, if he had not been bribed, would not have agreed to pay any sum.

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The Data Advantage Claim 123 The Data Advantage claim made by the prisoner was supported by the Adler letter which the prisoner had allegedly obtained from archives and by a legal opinion from Mr Rofe. Mr Howard did not know that the Adler letter had only recently been fabricated by the prisoner. However, in February 2001 Mr Howard already doubted the veracity of Mr Adler. 124 The prisoner's claim that FAI Home Security was entitled to a large percentage of the shares in Data Advantage Limited which had been allocated to FAI Insurances was based on a premise that between 1 October 1994 and 30 September 1997 a large proportion or all of the shares in FAI Finance Corporation had been held by FAI Home Security. However this premise was untrue, as would have been readily discoverable by Mr Howard. Between 1 October 1994 and 30 September 1997 shares in FAI Finance Corporation were held by FAI Home Security, only for a short period between 1 October 1994 and February 1995. Between February 1995 and 30 September 1997 all shares in FAI Finance Corporation were held by FAI Insurances and no shares in FAI Finance Corporation were held by FAI Home Security. Consequently, any claim by FAI Home Security to the shares in Data Advantage Limited would have been far less than any of the claims which were made at various times by the prisoner, for example claims to 50 per cent or 80 per cent or 85 per cent of the shares in Data Advantage Limited which had been allocated to FAI Insurances. 125 Furthermore, in a sale completed in about March 2000 FAI Home Security had sold to HIH the shares it then held in FAI Finance Corporation. I am satisfied that any claim which FAI Home Security might have had to shares in Data Advantage Limited was taken into account in negotiating the sale price on the sale of the shares and that any such claim passed on completion of the sale from FAI Home Security to HIH. That was also the view taken by Mr MacDonnell, the Chief Operating Officer of HSI, who conveyed that view to the prisoner in November 2000. 126 The fact that the prisoner resorted to fabricating the Adler letter suggests that the prisoner was well aware of the spuriousness of the claim. 127 Before agreeing to settle the claim, Mr Howard obtained his own legal advice on the Data Advantage claim and the advice he received did not support accepting the claim. 128 I am satisfied that Mr Howard, if he had not been bribed, would not have agreed to pay any sum.

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The Publicard Shares Claim 129 Counsel for the prisoner pointed to evidence given by Mr Howard at the trial in which he said that he had finally submitted to the prisoner's claim, because he was tired of the matter and because there were greater issues at HIH. However, the claim was completely lacking in any foundation and known by Mr Howard to be completely lacking in any foundation and I am satisfied that Mr. Howard, if he had not been bribed, would not have agreed to pay any sum. 130 I will now deal, fairly succinctly, with other claims made by the prisoner on behalf of companies associated with the prisoner, which were settled by Mr. Howard. The Claim for Compensation for Refurbishment Expenses and Relocation Expenses 131 For some years companies associated with the prisoner were sub-lessees of parts of an office building at North Sydney. The sub-lessor was FAI Insurances or a company associated with FAI Insurances, which was itself a head lessee. The prisoner claimed that his companies had originally entered into the sub-leases at the request of Mr Adler. 132 In 1995 and 1996 companies associated with the prisoner had incurred expenditure in refurbishing parts of the leased premises. 133 In the year 2000 the owner of the building was terminating the leases of tenants. The prisoner made a claim to Mr Howard to be compensated for the costs of the refurbishment in 1995-1996 and the costs of relocating his businesses elsewhere. The claim made by the prisoner was settled by Mr Howard for $275,000. 134 I am satisfied that, if Mr Howard had not been bribed, he would not have agreed to pay any amount. There was no legal obligation on HIH or FAI Insurances to compensate the prisoner's companies for either the refurbishment expenses or the relocation expenses. Furthermore, the prisoner's companies owed more than $800,000 in arrears of rent and, even if any claim, legal or commercial, existed, the claim would have been rejected by Mr Howard, if he had not been bribed, on the basis that a much larger sum in arrears of rent was owing by the prisoner's companies.

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The Ness Payment Claim 137 On 27 September 2000 a deal summary between HIH and HSI was signed by Mr Williams on behalf of HIH and Mr Adler, who had just become the Chief Executive Officer of HSI. Part of par 3 of the deal summary read:- "HIH will provide HSI with a further $A2.5m of funds by 30 June 2001". 138 In December 2000 and early January 2001 the prisoner pressed Mr Howard for early payment of the sum of $2.5m. 139 In early January 2001 Mr Howard had a conversation with the prisoner. The conversation was to the following effect:- The prisoner said, "you know we need the $2.5m, when can you make a payment?" Mr Howard said, "but that's not due until June 2001". The prisoner said "read the term sheet, Bill. It says by June 2001". 140 Mr Howard read the deal summary or term sheet again and in a later conversation said to the prisoner "yes, you are right, I shall organise payment this week". 141 The amount of $2.5m was paid by HIH C&G on 5 January 2001. 142 It is true that HIH had by the term in the deal summary bound itself to provide HSI with $2.5m. However, by the term in the deal summary the money was to be provided "by 30 June 2001". Mr Howard was clearly right in saying in his conversation with the prisoner in early January 2001 that the money was not due until June 2001. I am satisfied that Mr Howard submitted to the prisoner and agreed to make an early payment of the full amount, only because he had been bribed. 143 Because by the term in the deal summary an amount of $2.5m would have become due by 30 June 2001, Mr Howard, if he had not been bribed, might have agreed to an early payment, provided that the amount of the payment was discounted to allow for the early payment, even though any early payment would have been disadvantageous to HIH because of its shortage of cash. 144 In dealing with the Ness payment claim I have not sought to deal with the difficult question of whether the paragraph in the deal summary survived two formal agreements entered into in December 2000.

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151 Mr Jurd protested to Mr Howard against the assumptions he was being asked to make, on the grounds that FAI Home Security was currently selling each month less than the lower figure of 1200 units. Mr Howard persisted in asking Mr Jurd to do the calculations, using the assumptions Mr. Howard has asked him to make. 152 Mr Jurd did the calculations, on the assumptions he had been asked by Mr Howard to make. On the assumption that FAI Home Security would be selling 1200 units per month, Mr Jurd's calculations produced a figure of $2,349,356. On the assumption that FAI Home Security would be selling 1500 units per month, Mr Jurd's calculations produced a figure of $2,936,696. 153 Mr Howard had a conversation with the prisoner in which he proposed a one-off payment in settlement of the discount rebate claim. The prisoner and Mr Howard agreed to settle the discount rebate claim for $2.7m, which was a figure in between the two figures calculated by Mr Jurd, and this amount was paid on 22 December 2000. I accept the submission made by the Crown that it is no coincidence that this payment was made at about the same time as Mr Howard received the first payment of a bribe. 154 The prisoner's company was entitled to be paid some amount for the discount rebate claim, if only to compensate FAI Home Security in respect of the period in which, contrary to the term in the deal summary, a rebate of 18 per cent and not 15 per cent had been withheld by FAI Finance Corporation. However, there was no justification for Mr Howard arranging for the prisoner's company to be paid in December 2000 an undiscounted sum representing the difference between a discount at the rate of 18 per cent and a discount at the rate of 15 per cent for the twelve months to 30 September 2001. 155 If an amount was to be calculated as representing the difference between the estimated total amount of discount at 18 per cent and the estimated total amount of discount at 15 per cent for the twelve months to 30 September 2001, then realistic assumptions should have been used as to the number of units per month FAI Home Security would be likely to sell. Mr Howard was expressly told by Mr Jurd that the assumptions Mr Howard was asking Mr Jurd to make were unrealistic. 156 At the trial Mr MacDonnell, HSI's Chief Operations Manager up to about November 2000, produced monthly management reports showing that between July 2000 and October 2000 sales by FAI Home Security had never reached as high as 1200 units. 157 Although some amount would have been properly payable to FAI Home Security for the discount rebate claim, the claim would not have been settled so favourably for FAI Home Security, if Mr Howard had not been bribed.

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The Introduction Fee 158 HIH had a property portfolio, that is it owned a number of pieces of real estate. 159 In late 2000 and early 2001 HIH was in a liquidity crisis, which might possibly be alleviated by a quick sale of the properties in the property portfolio. 160 The prisoner had a conversation with Mr Howard in which the prisoner said that a property developer might be interested in acquiring HIH's property portfolio. 161 On 14 February 2001 there was a meeting between Mr Howard, the prisoner and Mr Ben Tilley, who was friendly with Mr. Kerry Packer. At the meeting Mr Tilley said that Mr Kerry Packer might be interested in acquiring the property portfolio at the right price. 162 Subsequently, Mr Howard told the prisoner that the prisoner and Mr Tilley would have to speak to Mr Wein, the new Chief Executive Officer of HIH, about the property portfolio and the prisoner did speak to Mr Wein. 163 On 2 March 2001 there was a meeting at the offices of Consolidated Press, which was attended by representatives of Consolidated Press (as so described by Mr. Howard in his evidence), Mr Tilley and Mr Wein and Mr Howard representing HIH. The HIH representatives told the meeting that HIH would be interested in selling the properties in the portfolio in one line at a discount of about 40 per cent. It was agreed at the meeting that the legal representatives of the parties would confer. 164 After the meeting the prisoner asked Mr Howard whether HIH would consider a fee for "getting Kerry Packer to the table and doing a deal". Mr Howard said that he saw that as feasible and he asked the prisoner to forward a document. 165 The prisoner sent Mr Howard a document in the form of a draft agreement, which included a term that HIH would pay a success fee/commission to Mr Tilley of US$2m. Mr Howard had a conversation with the prisoner in which he said that the fee proposed by the prisoner was too high. 166 Mr Tilley was overseas between the week-end of 3-4 March 2001 and 16 March 2001. While he was overseas, the prisoner represented Mr Tilley and himself. 167 On 7 March 2001 HIH exercised a put option. A consequence of HIH exercising the option was that it became doubtful whether a number of properties in the property portfolio were available to be sold by HIH. 168 On 7 March 2001 the prisoner sent a fax to Mr Howard in which he purported to "reconfirm" that he and Mr Tilley would themselves purchase the Toshiba building and an industrial site at Auburn, which were the two best properties in the property portfolio, while continuing to claim "an intermediary fee" of $2m plus 10 per cent GST. 169 Mr Howard had not agreed that the prisoner and Mr Tilley could purchase the Toshiba building and the industrial site. What HIH was trying to do was to sell all the properties in one line to Mr. Packer's company. 170 When told by Mr Howard that HIH had exercised the put option and that, consequently, certain properties in the portfolio might not be available for sale, the prisoner claimed that an option to purchase had been given by HIH over the properties in the property portfolio and the prisoner threatened legal action. 171 At a Board meeting of HIH held on Sunday 11 March 2001 Mr Howard reported to the Board that there was a fee payable to an intermediary for getting Kerry Packer to the table, that the fee being demanded was too high and that Mr Howard was still negotiating the amount of the fee. 172 Further negotiations took place and Mr Howard agreed to the following remuneration for the prisoner and Mr Tilley:-

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197 The prisoner offered to bribe Mr. Howard and bribes were given by the prisoner to Mr Howard on five separate occasions, the total amount being approximately $119,000 or approximately $124,000. The prisoner made the offer and made the payments with the intention of corrupting Mr Howard, that is with the intention of influencing Mr Howard to show favour to the prisoner's companies. I have found that Mr Howard was in fact corrupted by the offer and the payments. 198 I have found that the claims by the prisoner's companies which I have described as the first Vision Publishing claim, the second Vision Publishing claim, the Data Advantage claim, the Publicard shares claim, the legal expenses claim and the refurbishment and relocation expenses claim were without any foundation, and were known by both the prisoner and Mr Howard to be without any foundation and that, if Mr Howard had not been bribed, he would not have agreed to settle the claims for any amount and no amount would have been paid out by HIH C&G. 199 Claims which Mr Howard might have settled at some figure, if he had not been bribed, but which, because he had been bribed, were settled on terms which were excessively favourable to the prisoner's companies and unfavourable to HIH were the claims I have described as the discount rebate claim, the Ness payment claim and the introduction fee claim. 200 The first four of the false statement offences (counts 7 to 10 in the indictment) all involved making false statements to the effect that the Vision Publishing sponsorship claim had not been satisfied, when the prisoner well knew that it had been satisfied. 201 These false statements did not deceive Mr Howard, who knew the true position. However, the prisoner knew that the false statements could be used by Mr Howard to deceive other employees or officers of HIH or HIH C&G into believing that the Vision Publishing sponsorship claim had not been satisfied. 202 The false statements in counts 11 and 12 were false statements to the effect that an agreement had been made on 2 August 1999 between the prisoner and Mr Adler representing FAI Insurances that 80 per cent of the value of the shares in Data Advantage Limited which had been allocated to FAI Insurances should be paid to FAI Home Security and that a letter sent to Mr. Howard recording this alleged agreement had been retrieved from archives. The prisoner knew that these statements were false. He knew that the letter which he alleged had been retrieved from archives had been fabricated by him in January 2001. 203 The prisoner knew that the false statement the subject of count 13 was false and that he had no entitlement whatever to payment of the sum of $148,200. 204 Mr Howard was not deceived by this false statement because Mr Howard, also, knew that the statement was false. However, the prisoner knew that the false statement could be used by Mr Howard to deceive other employees or officers of HIH into believing that a payment by HIH C&G of $148,200 was warranted. 205 The aggravating factors referred to in paragraphs (g) and (n) of s 21A(2) of the Crimes (Sentencing Procedure) Act were present. 206 As to (g) the damage caused by the offences was substantial. The damage was aggravated because, as the prisoner knew, HIH was in desperate financial straits and was desperately short of cash. 207 As to (n) the offences were planned. The meeting at the Hotel on Sunday 3 December 2000 was arranged by the prisoner. I am satisfied that the prisoner intended to offer Mr. Howard a bribe at the meeting. The offer to "look after" Mr Howard was not the result of a spur of the moment decision taken at the meeting. The false statement offences were committed in the course of carefully planned and executed criminal schemes. 208 As to paragraph (k) of s 21A(2), the prisoner did not commit any direct breach of trust in that he was not a director, an officer or an employee of HIH or of any company which was a member of the HIH group of companies. However, the prisoner was complicit in breaches of trust by Mr Howard. Mr Howard was a senior officer of HIH C&G and the prisoner offered a bribe and gave bribes to Mr. Howard with the intention of procuring Mr Howard to commit breaches of trust and the prisoner's conduct had that consequence. The knowingly false statements made by the prisoner were made with the intent of procuring or assisting Mr Howard to commit breaches of trust. Deterrence

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209 It was submitted by the Crown, and I accept, that there is a need for the sentences I impose to give effect to the sentencing purpose of general deterrence. The offences were planned and, before committing each offence, the prisoner would have had the opportunity of weighing up the advantages and disadvantages to him of committing the offence. 210 There is a need for general deterrence in sentencing for offences of bribery. Bribery is an offence which is difficult to detect, difficult to investigate and difficult to prove. The present offences of bribery became capable of being proved, only because Mr Howard, after a long period of strenuously denying that he had been guilty of any wrongdoing, admitted his guilt and agreed to provide assistance to law enforcement authorities, including giving evidence against the prisoner. In the present case the bribery offences involved the corrupting of a senior officer of a company. Mitigating Factors 211 It was submitted on behalf of the prisoner that a number of mitigating factors within s 21A(3) of the Crimes (Sentencing Procedure) Act were present. 212 I accept that the prisoner has no criminal record (par (e)), that the prisoner is a person of previous good character (par (f)), that the prisoner is unlikely to re-offend (par (g)) and that the prisoner has good prospects of rehabilitation (par (h)). 213 As to the prisoner's previous good character, I accept that the evidence goes beyond a mere absence of criminal convictions. The prisoner has been an extremely hard worker. Evidence was given at the trial and in the proceedings on sentence of a number of acts of generosity by the prisoner to employees and to others. 214 I accept that in the present case the evidence of previous good character is relevant. However, evidence of previous good character is of less weight where, as here, the previous good character has enabled the offender to assume a position where he could commit the offences and it is also of less weight where an offender is to be sentenced for repeated offences committed over a period. 215 I accept that the prisoner is unlikely to re-offend but a reason for his being unlikely to re-offend is that he is unlikely ever again to be in a position where he could commit similar offences. 216 The prisoner did provide some assistance within s 23 of the Crimes (Sentencing Procedure) Act in the proceedings relating to the offences. However, the assistance provided by the prisoner was limited. The prisoner agreed that at the trial the statements of a number of witnesses could be read, without the makers of the statements being required to give oral evidence, and for the purposes of the trial a limited number of facts were agreed to by the prisoner. 217 On 6 May 2005 I gave certain directions ordering pre-trial disclosure pursuant to Div 3 of Pt 3 of the Criminal Procedure Act. On 24 June 2005 the prisoner's solicitors wrote to the Director of Public Prosecutions supplying the names of a number of witnesses to be called as character witnesses at the trial (none of whom were in fact called) and giving notice of the prisoner's intention to dispute the admissibility of large parts of the evidence in the Crown brief, including all of the evidence of Mr Howard, the principal Crown witness. 218 It was submitted by counsel for the prisoner that the factor in par (i) of s 21A(3) of the Crimes (Sentencing Procedure) Act was present, in that the prisoner had shown remorse by making reparation for damage suffered by HIH. 219 I do not consider that the prisoner has shown any remorse at all for any of the offences. 220 It was submitted that, in any event, the prisoner had made reparation for the damage caused by his offences. Counsel for the prisoner pointed to (1) amounts paid to the liquidator of HIH (2) amounts paid after the sale of FAI Home Security to Chubb. 221 A letter from Mr AG McGrath, the liquidator of HIH, became exhibit 11 in the proceedings on sentence. A set of agreed facts about payments made to the liquidator became exhibit 12 in the proceedings on sentence. The following statement of facts is taken from those exhibits. 222 After Mr McGrath was appointed liquidator, he made a number of demands on the prisoner and companies associated with him. Some of those demands were related to matters I have referred to in these remarks. Some of the demands were unrelated to any matter I have referred to. 223 The prisoner's solicitors replied, refusing to comply with the liquidator's demands. 224 The liquidator instituted proceedings in the Supreme Court to enforce the demands. A defence was filed in the Supreme Court proceedings. 225 Negotiations took place between the parties and an agreement was reached. Under heads of agreement dated 3 July 2003 the prisoner was required to pay the sum of $2.5 m by 30 September 2003. A dispute about a comparatively minor amount led to further heads of agreement. 226 An amount of approximately $2.5 m has been paid by the prisoner to the liquidator and Mr McGrath says in his letter that, so far as the liquidator is concerned, the prisoner and the prisoner's companies have discharged their obligations. 227 It is to be noted that the payments made by the prisoner or his companies were not voluntary; they were made only after court proceedings had been commenced and prosecuted. Furthermore, it appears that at least some of the monies paid to the liquidator were provided, not by the prisoner or any of his companies, but by third persons. 228 Counsel for the prisoner submitted that it was a mitigating factor that the offences had been committed by the prisoner, not out of a motive of personal gain, but out of a motive of obtaining advantages for companies associated with him. 229 I do not consider that it would be a mitigating factor that the prisoner's motive was, not to obtain advantages for himself, but to obtain advantages for companies associated with him. In any event, the companies were so closely associated with the prisoner that the obtaining of advantages for them amounted to the obtaining of advantages for him. As I have already noted, all the shares in the Goodwill Group Pty Limited and Speak Easy Pty Limited were beneficially owned by the prisoner and all the shares in Vision Publishing were beneficially owned by the Goodwill Group Pty Limited. FAI Home Security was a wholly owned subsidiary of HSI and, by an agreement recorded in a term sheet of 8 December 2000, HIH agreed to sell its shareholding in HSI, with the consequence that the prisoner came to hold over half the shares in HSI. 230 I note that in late 2000 and early 2001 the prisoner did not curtail his extravagant lifestyle, including driving expensive cars, living in a residential apartment at Balmoral, staying at Hayman Island and gambling large sums at a casino. 231 It was submitted by counsel for the prisoner that the prisoner has already suffered extra-curial punishment, that is loss or damage quite apart from any sentences I impose, and that I should take this extra-curial punishment into account in sentencing him. 232 I accept that the prisoner has suffered widespread adverse media publicity and public humiliation. I accept that, whatever offences he might have committed, some of the adverse media publicity about him has been unmerited. For example, in some publications he has been described, wrongly, as having been a director or an officer of HIH. He has sometimes been described as a person responsible for the collapse of HIH. On the limited information available to me, that description would appear to be unwarranted. 233 I accept that the prisoner has made the reparation I have already referred to. I also accept that he has no assets and has been made bankrupt and that his convictions for these offences will make it difficult for him to operate commercially or to obtain employment. Protection 234 It was submitted by counsel for the prisoner that I should take into account that since he went into custody the prisoner has been on some form of protection and that he may spend the whole or part of his sentence on protection.

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235 The evidence in the proceeding on sentence included exhibit 13, written answers by the General Manager of the Metropolitan Remand Reception Centre in response to a joint request for information by the prisoner's legal representatives and the Director of Public Prosecutions and an affidavit by Mr Pezzano, an officer of the Department of Corrective Services. 236 The prisoner went into custody on 31 October 2005, after the jury returned their verdicts of guilty. He was admitted into the Metropolitan Remand Reception Centre at Silverwater. As he has not yet been sentenced, he has remained in the Reception Centre. 237 When the prisoner went into custody he was placed on non-association protection, at his own request, because he said that he feared for his safety. But for his request, he would not have been put on protection. As the prisoner has not given evidence and as there is no other evidence, there is no evidence of any grounds for any fear the prisoner may hold for his safety. 238 Subsequently, at his own request, the prisoner was placed on limited association protection, because he said that he wanted to spend more time out of his cell to prepare his case for this sentence hearing. Subsequently he reverted, at his own request, to non-association protection. The prisoner has decided to remain on protection, until he is sentenced. 239 Once the prisoner has been sentenced, his status will change from that of being a remand prisoner to that of being a sentenced prisoner and he will be transferred from the Remand Centre to a Correctional Centre. 240 According to the evidence in the proceedings on sentence, because the prisoner has been on protection while on remand and because the prisoner is likely to be classified upon being sentenced as being a minimum security inmate, it is likely that, on being sentenced and classified, he will be transferred to one of three particular correctional centres. 241 Two of these centres are populated exclusively by inmates who have previously been on protection and do not have separate areas for protective custody. Inmates at these centres have full association with other inmates, are not confined to their living quarters for any specified period each day and have full access to all facilities and programmes conducted by the Department of Corrective Services. The same statements apply to the third correctional centre, except that it does have some inmates who are on protection and who are separated from other inmates within the centre.

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249 On the first count Kirby J sentenced Mr Howard to imprisonment for one year nine months to date from 23 December 2003, the date of sentencing. On the second count Kirby J sentenced Mr Howard to imprisonment for two years to date from 23 December 2004, that is to say Kirby J made the sentence on the second count partly cumulative on the sentence for the first count. Kirby J made an order suspending both sentences. 250 Kirby J arrived at the sentences he imposed in the following manner. His Honour considered that, before allowing certain discounts, an appropriate sentence for each offence would be imprisonment for three years. 251 Mr Howard had pleaded guilty and was entitled to a discount for his pleas of guilty. Mr Howard had disclosed information previously unknown to the authorities. He was thus entitled to a discount under the principle in R v Ellis on both charges but Kirby J considered that he was entitled to a higher discount on count 1 than on count 2. Mr Howard had provided assistance and had undertaken to provide future assistance, including giving evidence against the present prisoner. 252 On count 1, after allowing a combined discount of 40 per cent for the plea of guilty, the Ellis factor and the discount for past assistance, Kirby J arrived at a sentence of one year nine months. 253 On count 2, after allowing a combined discount of 331/3 per cent for the plea of guilty, the Ellis factor and the discount for past assistance, Kirby J arrived at a sentence of two years. 254 Kirby J considered that there should be a partial accumulation of the two sentences. Because of Mr Howard's undertaking to provide future assistance, his Honour suspended the execution of both sentences. 255 The present prisoner did not plead guilty, is not entitled to any Ellis discount, has not provided any past assistance, and has not undertaken to provide any future assistance. 256 It was submitted by counsel for the prisoner that the starting point of three years adopted by Kirby J, before allowing discounts for these matters, would be appropriate for each of the offences charged in counts 2 to 6 of the indictment and each of the offences charged in counts 7 to 10 of the indictment. It was not contended that the sentences should be suspended. 257 In my opinion, while there should be some proportionality between the sentences which would have been imposed on Mr Howard, but for the discounts, and the sentences which I should impose on the prisoner, the sentences which should be imposed on the prisoner should be higher. There are a number of reasons why this should be so. 258 Mr Howard was charged with offences under the Corporations Act for which the maximum penalty was imprisonment for five years. The offences under s 249B(2)(b) of the Crimes Act for which I am sentencing the prisoner carry a higher maximum penalty of imprisonment for seven years. 259 As between the prisoner and Mr Howard, I am satisfied that, compliant and culpable as Mr Howard was, the prisoner was the instigator of the offences and for that reason his criminality was greater. The prisoner offered Mr Howard a bribe; it was not a case of Mr Howard soliciting a bribe. The idea of making the second claim for payment of the Vision Publishing sponsorship originated with the prisoner. 260 The conduct with which Mr Howard was charged and particulars of which were set out in the agreed facts and which was accordingly the conduct for which Mr Howard was sentenced, was less serious than the conduct I have found the prisoner engaged in and for which I am sentencing him. 261 In the first count against him Mr Howard was charged with having dishonestly used his position, "recklessly" as to whether the abuse of his position resulted in the prisoner gaining an advantage and with having received cash sums in return for "facilitating" payments by HIH to companies associated with the prisoner. 262 The meaning of the expression "facilitating" was unclear and was not resolved in the agreed statement of facts. As Kirby J remarked in his remarks on sentence, "the criminality involved in easing and accelerating the passage of legitimate claims is markedly different from the criminality in overlooking blatant exaggeration or deficiencies in the claims put forward". 263 Kirby J would appear to have been constrained by the agreed facts and the absence of other evidence to sentence Mr Howard for the first offence on the basis that it could not be said that Mr Howard had any actual awareness of any of the claims being exaggerated or deficient. Indeed, Kirby J said in his remarks on sentence that, apart from the payment of $737,500 to the Goodwill Group Pty Limited, which was the subject of the second count, "it should not be assumed that these sums (that is the sums paid to the prisoner's companies) represented a benefit to Mr Cooper to which he was not entitled. He was certainly not entitled to the duplicate payment of $737,500 for Vision Publishing. The remaining claims, however, to a greater or lesser extent may have been legitimate". 264 The only claims referred to in relation to the first count against Mr Howard were the first Vision Publishing claim, the discount rebate claim, the Data Advantage claim and the Publicard shares claim. I have found that the prisoner knew that the conditions on which the first Vision Publishing claim might become payable had not been satisfied, that the Data Advantage claim was groundless, that the Publicard shares claim was utterly groundless and that the discount rebate claim was greatly exaggerated. 265 I have also found that other claims made by the prisoner's companies, which were not before Kirby J, were also groundless. 266 It is true that Mr Howard's conduct constituted breaches of trust by him and that the prisoner was not himself directly guilty of breaches of trust. However, as I have explained earlier, the prisoner was complicit in the breaches of trust by Mr Howard, intentionally procuring those breaches of trust. 267 Although the Data Advantage claim and the Publicard shares claim were two of the claims referred to by Kirby J in connection with the first count against Mr Howard, there were no charges against Mr Howard corresponding to counts 11, 12 and 13 in the indictment against the prisoner.

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Multiple Offences 268 I am sentencing the prisoner for multiple offences. I take into account the sentencing principle in Pearce v The Queen that I should fix an appropriate sentence for each offence and then consider questions of cumulation or concurrency as well as questions of totality. 269 I take into account that in all cases, including where punishment is imposed for multiple offences, the aggregate sentence should fairly and justly reflect the total criminality of the offender's conduct. It will be necessary to make some of the offences partly cumulative, in order that this principle of sentencing should be satisfied. On the other hand, when a judge is sentencing for as many as thirteen offences, it is unavoidable, unless extreme complication and artificiality is resorted to, that there should be some grouping of sentences and some making of sentences fully concurrent with each other. 270 Some of the sentences I impose will be fixed terms of imprisonment, because, if a parole period was set, the parole period would be completely subsumed in the fixed term or the non-parole period of another sentence. The fixed terms of imprisonment will be equivalent to what would have been the non-parole periods in sentences containing a non-parole period and a parole period. 271 Because all the offences were committed before 1 February 2003, it is necessary to comply with the previous, and not the current, section 44 of the Crimes (Sentencing Procedure) Act. 272 It will be convenient to make the sentences for the false statement offences the first sentences to be served. Special Circumstances 273 I do not consider that, because I am sentencing the prisoner for offences which might be broadly described as "white collar" crimes, there should be a substantial gap between the head sentence or sentences and the non-parole periods. I must set sentences such that the time that the offender must spend in prison reflects the objective gravity of his offences and the need for general deterrence. However, I am prepared to find special circumstances within s 44 of the Crimes (Sentencing Procedure) Act in that the prisoner was previously of good character and has not previously been imprisoned. I will give effect to the finding of special circumstances by making the total of the fixed terms and non-parole periods less than three-quarters of the total terms of the sentences.

Regina v Cooper

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