168 A Crim R 41
CMB v Attorney General for New South Wales [2015] HCA 9
317 ALR 308
Green v The Queen
Quinn v The Queen [2011] HCA 49
244 CLR 462
Hili v The Queen
Source
Original judgment source is linked above.
Catchwords
168 A Crim R 41
CMB v Attorney General for New South Wales [2015] HCA 9317 ALR 308
Green v The QueenQuinn v The Queen [2011] HCA 49244 CLR 462
Hili v The QueenJones v The Queen [2010] HCA 45242 CLR 520
Majeed v R [2013] VSCA 40
Markarian v The Queen [2005] HCA 25228 CLR 357
Milne v R [2012] NSWCCA 24259 FLR 42
Milne v The Queen [2014] HCA 4252 CLR 149
R v Bugmy (No 2) [2014] NSWCCA 322
R v DHR v AH [2014] NSWCCA 326
R v Ferrer-Esis (1991) 55 A Crim R 231
R v GuoR v Qian [2010] NSWCCA 170201 A Crim R 403
R v Harris [2015] NSWCCA 81
R v Hernando [2002] NSWCCA 489136 A Crim R 451
R v Lee [2007] NSWCCA 234
R v Li [2010] NSWCCA 125202 A Crim R 195
R v Milne (No 1) [2010] NSWSC 932260 FLR 166
R v Nguyen [2013] NSWCCA 195234 A Crim R 324
R v NguyenR v Pham [2010] NSWCCA 238
205 A Crim R 106
Shi v R [2014] NSWCCA 276
The Queen v De Simoni [1981] HCA 31
147 CLR 383
The Queen v Olbrich [1999] HCA 54
199 CLR 270
Wong v The Queen
Leung v The Queen [2001] HCA 64
Judgment (12 paragraphs)
[1]
Judgment
THE COURT: The Crown has appealed, pursuant to s 5D of the Criminal Appeal Act 1912 (NSW), against the sentence imposed on the respondent, Ms Jiao, following her conviction of one offence of dealing with money, the value of which at the time of dealing was more than $100,000, that it was reasonable to suspect was the proceeds of crime (s 400.9(1) of the Criminal Code 1995 (Cth)).
Ms Jiao pleaded not guilty to that charge. After a trial in the District Court commencing on 1 December 2014, the jury returned a guilty verdict on 17 December 2014. On 19 December 2014, Ms Jiao was sentenced. The sentencing judge assessed the objective seriousness of her offending as falling just within the middle of the range for crimes such as this. His Honour also acknowledged that this was a serious offence and that general deterrence was an important factor. The maximum penalty for the offence of which Ms Jiao was convicted was imprisonment for 3 years and/or a fine of $30,600 (180 penalty units). The sentence imposed was a fixed term of imprisonment for 6 months, to commence that day and to expire on 18 June 2015.
The sole ground of appeal is that the sentence imposed was manifestly inadequate. In essence, the Crown contends that the sentence imposed did not reflect the seriousness of the offence created by s 400.9(1) nor the objective gravity of Ms Jiao's offending and that it leaves no room for the differentiation in other cases, where there may be lesser criminality or greater mitigation than was present in Ms Jiao's case. The Crown emphasises the importance of consistency in sentencing and guidance as to sentencing standards in respect of s 400.9(1) offences, given that the offence is of wide ranging application.
[2]
Background
The conduct the subject of the offence occurred in January 2013. Ms Jiao, who holds both Taiwanese and New Zealand passports, flew to Sydney on 18 January 2013 from New Zealand. She was staying at the time at The Star casino in Sydney, where she apparently had a casino account.
On 20 January 2013, Ms Jiao met a man later identified as Mr Thi Nguyen at The Star casino. She did not know him. Ms Jiao identified herself to Mr Nguyen by exchanging with him an AU$5 bank note with a known serial number. It is accepted by Ms Jiao, though there was no finding of fact on this issue, that there was evidence before the jury that this method of identification was common practice when cash was passed between criminal syndicates and money laundering syndicates. The sentencing judge must have been referring to this at [15] of his reasons when taking into account the "use of the process of identification". On the Crown's case, this was a significant matter going to the objective seriousness of the offending as it meant that the crime was one involving a degree of planning and contemplation.
Once the identification was made, Ms Jiao accompanied Mr Nguyen to the casino car park and collected a sports bag from him. The couple then attended Ms Jiao's hotel room for a short period of time where, according to his Honour's understanding of the evidence, the bag was opened (see [4] of the reasons for sentence). His Honour referred to a backpack covered with a plastic bag. It contained Australian currency. Ms Jiao then went to the Sovereign Room at The Star and deposited the money, amounting to $624,340, into her casino account. His Honour noted that there was evidence from a relatively senior member of the casino staff as to the condition of the money: namely, that many of the bank notes were not in good condition; they were in some way soiled and gritty; and they were not wrapped in a way consistent with the way a bank would wrap currency (at [5]).
Ms Jiao requested that $200,000 of the funds in her casino account be transferred to a Commonwealth Bank of Australia account in Brisbane in the name of a money remitter. The casino staff declined that request on the basis that they were entitled only to transfer money into accounts held in the name of the customer, but Ms Jiao was informed that she could withdraw cash and make a deposit into the nominated bank account directly. On 21 January 2013, Ms Jiao withdrew $300,000 in cash and took it to the Pyrmont branch of the Commonwealth Bank.
Meanwhile, casino staff had notified the Australian Federal Police. Ms Jiao was arrested at the bank, being in possession of $300,000 in cash and the deposit and withdrawal slips from the casino as well as two mobile phones.
Ms Jiao was interviewed by the Australian Federal Police. His Honour noted that Ms Jiao appeared to be co-operative and forthcoming with information. The Crown accepts that, during conversation with the police officers, Ms Jiao made statements to the effect that the cash belonged to a Mr Liu, whom she did not know and did not know how to contact; that she was depositing the cash into her Commonwealth Bank account before transferring it to another Commonwealth Bank account in the name of Anna Yu, that being an account of a money remitter who could release the funds in China once the money had been deposited; that the money was to be sent to a customer of her brother's travel business in Taiwan; and that she worked at a money remittance business located in New Zealand which was managed by her son, Charles Harsono.
[3]
Money laundering provisions
Section 400.9(1) of the Code provides that:
A person commits an offence if:
(a) the person deals with money or other property; and
(b) it is reasonable to suspect that the money or property is proceeds of crime; and
(c) at the time of the dealing, the value of the money and other property is $100,000 or more
Penalty: Imprisonment for three years, or 180 penalty units, or both.
Absolute liability applies to the elements in subss 1(b) and (c) (see s 400.9(4)). For an offence under s 400.9, there is no fault element and hence no requirement to prove any knowledge or belief on the part of the accused that the money was the proceeds of crime (Shi v R [2014] NSWCCA 276 at [42]).
The Crown emphasises that the legislature has drawn a distinction in s 400.9 between offences involving dealing with money or property the value of which is $100,000 or more (s 400.9(1)), in respect of which a maximum penalty of 3 years' imprisonment and/or 180 penalty units is imposed, and offences involving dealing with money or property less than $100,000 (s 400.9(1A)), in respect of which the maximum penalty is imprisonment of 2 years and/or 120 penalty units. That distinction was introduced into the legislation on 19 March 2010. (Neither the second reading speech nor the explanatory memorandum for the Crimes Legislation Amendment (Serious and Organised Crime) Bill (No. 2) 2009 (Cth), which led to the 2010 amendments to s 400.9, provides any useful assistance in the present case.)
The Crown points to the increase in the maximum gaol term and the greater maximum fine as indicating that an offence involving a dealing with money of $100,000 or more is regarded by the legislature as being substantially more serious than one involving amounts below $100,000 and submits that the paramount consideration in sentencing for a s 400.9(1) offence is the amount of money or property involved in the dealing.
The Crown notes that the structure of the Federal money laundering offences in the Criminal Code is one whereby the maximum penalty rises according to a combination of the amount of money or other property involved and (though this is not relevant for a s 400.9 offence) the degree of culpability by reference to the offender's state of mind or intended use of the money or property.
In Shi v R, Bellew J, with whom Leeming JA and Fullerton J agreed, said (at [45]) that the structure of Division 400 of the Criminal Code, in which s 400.9(1) appears, is such that the offence created by s 400.9(1) falls at the lowest end of the scale (of money laundering offences). The Crown submits that this is not strictly accurate, having regard to the fact that the maximum penalty for a s 400.9(1) offence is equivalent to or exceeds a number of the offences created by other sections of the Criminal Code in Division 400. That this is so is evident by reference to the matrix appended to these reasons. It can be seen that for the offences in ss 400.3 - 400.8 the maximum penalty rises not only as the value of the money or property dealt with increases, but also according to whether the offender is negligent, or reckless, or has a belief or intention as to the fact that the money or property is proceeds of crime or that there is a risk that it will become an instrument of crime.
[4]
Primary judgment
When considering the objective seriousness of Ms Jiao's offence, his Honour took into account that this was "not a fleeting or transitory" transaction, though observing in this context that it was not as serious as behaviour which might occur over some weeks ([13]); that the money involved was over six times the monetary threshold for the offence ([14]); and that the transaction as found by the jury was "obviously done" in circumstances where it was objectively reasonable to suspect that the money was the proceeds of crime ([15]). His Honour considered that the latter conclusion followed from the condition of the bank notes and the process of identification that had been adopted.
His Honour made clear that, in taking into consideration that it was objectively reasonable to conclude that the money was the proceeds of crime, he was not attributing any subjective intention to Ms Jiao (see [15]). (It should be noted that the submissions on sentence for Ms Jiao had nevertheless emphasised that Ms Jiao had "honestly believed she was doing nothing wrong in taking the money", had "not necessarily appreciat[ed] she was committing an offence", and that, while found guilty, she still believed "that as far as she was concerned she was dealing with her brother's money".)
His Honour concluded (at [16]) that the offence did not fall at the lowest end of this kind of offending, because of the amount involved and the fact that it was over a couple of days, but said that it was "far from the most serious example of this crime and probably falls just within the middle of the range of seriousness for crimes such as this" (my emphasis). The Crown does not challenge that finding, though it had contended in the District Court that the objective gravity of Ms Jiao's offending was greater than mid-range. Similarly, Ms Jiao, while contending in her written submissions that his Honour's finding was in substance a finding that this was at the bottom end of the mid-range of seriousness, conceded in oral submissions that in this appeal she could not so contend in the absence of an application by Ms Jiao for leave to appeal against sentence. (This Court was informed during the course of oral submissions that Ms Jiao has lodged an appeal against conviction but no attempt was made to bring this before the Court at the time of the hearing of the Crown appeal. On 7 May 2015, the Registrar was informed that the appeal was to be abandoned.)
[5]
Submissions
The Crown concedes that the sentencing judge's remarks on sentence disclose no patent error of law and that, to succeed on appeal, the Crown must establish that the sentence is unreasonable or plainly unjust (Markarian v The Queen [2005] HCA 25; 228 CLR 357 at 370-1 [25]). In R v Bugmy (No 2) [2014] NSWCCA 322, Bathurst CJ (at [12]) said that it was necessary to establish that the sentence was outside the range of sentences that could have been imposed, such that the appellate court concludes there must have been some misapplication of principle even though when or how is not apparent from the statement of reasons (citing Hili v The Queen; Jones v The Queen [2010] HCA 45; 242 CLR 520 at 538-9 [59] and Wong v The Queen; Leung v The Queen [2001] HCA 64; 207 CLR 584 at 605-6 [58]).
The Crown also accepts that, being a Crown appeal on sentence, the primary purpose of the appeal is not the correction of error in this particular case but the laying down of principles for the governance and guidance of courts having the duty of sentencing convicted persons. This purpose will be satisfied if it can be demonstrated that, while the sentencing judge made no error of principle when sentencing, the sentence imposed nevertheless fell outside the range of sentences legitimately available (citing Green v The Queen; Quinn v The Queen [2011] HCA 49; 244 CLR 462; R v DH; R v AH [2014] NSWCCA 326).
The Crown submits that in the present case the sentencing discretion has miscarried in the sense that the sentence imposed was unreasonable or plainly unjust, especially having regard to: the amount of money involved (just over six times the monetary threshold for the relevant offence); the conduct of Ms Jiao; his Honour's characterisation of this as being offending in the middle range of seriousness; and the absence of any substantial mitigation beyond that of prior good character.
As to Ms Jiao's conduct, reliance is placed by the Crown on the fact that her role was (as Ms Jiao concedes) more than simply that of the receipt and deposit of the money. The Crown points to the element of planning involved in Ms Jiao flying to Australia and the arrangement of the $5 note identification process. The Crown also submits that, while the offence was not part of long running criminal conduct over many months, Ms Jiao's offence involved more than a single episode, noting that there was time for contemplation between the receipt of the money and Ms Jiao's successive attempts to transfer the money.
[6]
Comparative cases
Both parties refer to comparative cases in support of their opposing submissions as to the sentence imposed on Ms Jiao. The Crown submits that when the s 400.9(1) offences in these cases are considered in isolation of the other offending there also being considered, it is clear that the sentence imposed on Ms Jiao was not consistent with the sentences imposed in those other cases.
In Shi v R, the offender pleaded guilty to ten offences contrary to s 400.9(1) of the Criminal Code and one offence contrary to s 400.9(1A) of the Criminal Code. The offender's involvement was simply to receive and bank the money, with no element of transmission. She was found to be a low level participant in the criminal enterprise (a dispensable tool) with no autonomy. She had no prior criminal history and expressed remorse for her actions.
There was a much greater amount of money in total (around $35 million) and the amount of money involved in the respective individual offending transactions was, on all but two or three of the eleven counts significantly greater than the amount in question in the present case. Relevantly, however, the Crown points to counts 1 and 3, which related to dealings with moneys around the same as that in the present case ($772,450 and $532,950 respectively). Ms Shi was sentenced in respect of each of those offences counts to terms of imprisonment of 1 year and 6 months (the overall sentence imposed being 5 years and 6 months). On appeal from her sentence, Ms Shi was re-sentenced to fixed terms of imprisonment of 1 year and 3 months in respect of the respective s 400.9(1) offences (with no change to the 9 month sentence imposed in respect of the s 400.9(1A) offence). The Crown notes that this represented a sentence of just over 40% of the maximum penalty after the application of a combined discount of 30% (25% in respect of a plea of guilty and 5% for assistance).
In Ms Shi's case the assistance led directly to the discovery of a large quantity of cash and the arrest and prosecution of another offender (see [95]) and its significance was found to have been understated by the sentencing judge. In the present case, the assistance did not result in the prosecution of Mr Nguyen but Ms Jiao's co-operation was clearly instrumental in leading to her own conviction.
There was no need for the court to determine Ms Shi's contention that the sentences that had been imposed were manifestly excessive, given that other of her grounds of appeal were made out. Nevertheless it is instructive to note that on re-sentencing the reduction in her individual sentences was a period of 3 months. In contrast, in the present case, in an offence involving a similar sum to those which were the subject of counts 1 and 3 in Ms Shi's case, Ms Jiao received a 6 month sentence without the benefit of any discount for an early plea. The Crown submits that Ms Jiao's conduct was objectively more serious overall and that the sophistication of the wider criminal enterprise in Ms Shi's case is irrelevant because Ms Shi's own role was non-autonomous, limited to receipt and deposit of the money.
[7]
Conclusion
The importance of consistency in sentencing was emphasised by Gleeson CJ in Wong v The Queen, approved in Hili v The Queen; Jones v The Queen. A review of the comparative cases shows a marked absence of consistency between the sentences there imposed and that which was imposed on Ms Jiao.
Ms Jiao does not dispute that money laundering is a serious offence; that the amount of money involved is a paramount consideration; and that general deterrence is important. It is conceded that Ms Jiao played a significant role in the offending in this case and that she was certainly more than a "bag person" or mere courier. In that regard, it is accepted that Ms Jiao was not in the same position as Ms Shi who did no more than to receive money and deposit it.
While emphasis is placed on the "one-off" nature of the offending, it is conceded that what Ms Jiao was doing only came to an end because of the intervention of the police. Ms Jiao stressed the unsophisticated nature of the offence and that her involvement was at the instigation of her family members (who gave evidence at her trial). It is conceded that the defence case did not grapple at all with the origin of the money, as opposed to the intended use of the money.
For Ms Jiao it is submitted that the sentence of 6 months was adequate. That submission cannot be accepted. The money involved was six times above the monetary threshold. Ms Jiao's involvement went beyond mere possession of the money or mere receipt and deposit thereof, though it was not part of an ongoing or protracted criminal enterprise. The offence included an element of planning (by reference to the use of the $5 note identification procedure). Ms Jiao actively took steps to divert the money. No discount was available by reference to a guilty plea. Having regard to the importance of general deterrence in the context of money laundering offences, a sentence of imprisonment was the only appropriate sentence in this case and a significantly longer period of imprisonment was required.
We are satisfied that the sentence imposed on Ms Jiao was well outside the range of sentences appropriate in all the objective and subjective circumstances of the case, and having regard to the importance of general deterrence on sentence. The Crown has made good the claim of manifest inadequacy.
[8]
Residual discretion
The Court retains the residual discretion to decline to intervene with the sentence below even where it is found to be manifestly inadequate (Green v The Queen; Quinn v The Queen at [1]-[2]).
In CMB v Attorney General for New South Wales [2015] HCA 9; 317 ALR 308, the High Court made it clear that it is for the Crown, when asserting manifest inadequacy, to negate any reason why the residual discretion of this Court not to interfere should be exercised (referring to the analysis of Heydon JA, as his Honour then was, in R v Hernando [2002] NSWCCA 489; 136 A Crim R 451 at 458 [12]).
The Crown submits that in the present case there is no apparent reason why the residual discretion not to interfere should be exercised. Reference is made to the factors that were considered in R v Harris [2015] NSWCCA 81, albeit in relation to a different offence. There, this Court took into account that there had been no relevant delay in either the institution of the Crown appeal or the period within which there was likely to be a resolution of the Crown appeal. The same is the case here. The lodgement of the Crown appeal against sentence was some 11 working days after the sentence was imposed and the matter has been heard with expedition.
In R v Harris, the Court also took into account that the Crown did not make any submissions relevantly different from those made to the sentencing judge and that the error made by the sentencing judge was not the result of any misstatement of the law or facts or any erroneous submission made by the Crown (at [65]). Again, that is the case here save that there has been some further elaboration of the structure of the offences in Division 400 of the Criminal Code.
The Crown submits that there is no compelling reason to decline to intervene.
In her submissions in response, Ms Jiao points to the nature and severity of the conditions imposed by a prison sentence (referring to s 16A(3) of the Crimes Act) having regard to her age (almost 58) and the fact that she is a foreign national from New Zealand separated from her long term partner, who resides in New Zealand, and her family (submissions p 7). It is submitted that the imposition of further custodial time would be onerous and that this is not warranted. Ms Jiao submits that general deterrence is addressed by a prison sentence having been imposed and that she should not be penalised for defending the charge. As to the last submission, the suggestion that Ms Jiao has been or would be penalised for defending the charge by the imposition of a custodial sentence is unwarranted. Relevantly, the consequence of her defending the charge was that no discount for an early guilty plea was applicable, as his Honour noted.
[9]
Conclusion
The sentence imposed was well outside the range of sentences that could have been imposed consistent with the objective seriousness of the offending properly found and the importance of the need for general deterrence. The Crown has discharged the onus of negating any reason why the residual discretion of this Court not to interfere should be exercised. The sentence passed was manifestly inadequate and a substantial increase is warranted.
Taking into account the matters referred to at [69] above, but also noting that Ms Jiao's co-operation with the authorities provided information that must have been instrumental to the objective conclusion that the money involved was reasonably suspected of being the proceeds of crime, the appropriate course is to re-sentence Ms Jiao to a term of imprisonment for 16 months commencing on 19 December 2014 with release after 12 months upon entry by Ms Jiao into a recognizance under s 19AC of the Crimes Act to be of good behaviour for a period of 4 months. Such a sentence will maintain consistency with sentencing for like offences and allow room for appropriate differentiation in cases where there is a lesser degree of criminality and/or substantial mitigation.
Ms Jiao will be re-sentenced accordingly. The Court orders will be as follows.
[10]
Order
The appeal is upheld.
The sentence is quashed.
Ms Jiao is sentenced to a term of imprisonment of 16 months commencing on 19 December 2014 and is to be released on 19 December 2015 upon Ms Jiao entering into a recognizance to be of good behaviour for a period of 4 months expiring on 18 March 2016.
[11]
Section 400.3 Section 400.4 Section 400.5 Section 400.6 Section 400.7 Section 400.8 Section 400.9
Dealing in proceeds of crime etc.--money or property worth $1,000,000 or more Dealing in proceeds of crime etc.--money or property worth $100,000 or more Dealing in proceeds of crime etc.--money or property worth $50,000 or more Dealing in proceeds of crime etc.--money or property worth $10,000 or more Dealing in proceeds of crime etc.--money or property worth $1,000 or more Dealing in proceeds of crime etc.--money or property of any value Dealing with property reasonably suspected of being proceeds of crime etc.
(1)(b) either: If, the value of the money and other property is $100,000 or more:
(i) the money or property is, and the person believes it to be, proceeds of crime; or 25 years, or 1500 penalty units, or both. 20 years, or 1200 penalty units, or both. 15 years, or 900 penalty units, or both. 10 years, or 600 penalty units, or both. 5 years, or 300 penalty units, or both. 12 months, or 60 penalty units, or both. 3 years, or 180 penalty units, or both.
(ii) the person intends that the money or property will become an instrument of crime If, the value of the money and other property is less than $100,000:
2 years, or 120 penalty units, or both.
(2)(b) either:
(i) the money or property is proceeds of crime; or 12 years, or 720 penalty units, or both. 10 years, or 600 penalty units, or both. 7 years, or 420 penalty units, or both. 5 years, or 300 penalty units, or both. 2 years, or 120 penalty units, or both. 6 months, or 30 penalty units, or both.
(ii) there is a risk that the money or property will become an instrument of crime; and
(c) the person is reckless as to the fact that the money or property is proceeds of crime or the fact that there is a risk that it will become an instrument of crime (as the case requires)
(3)(b) either:
(i) the money or property is proceeds of crime; or 5 years, or 300 penalty units, or both. 4 years, or 240 penalty units, or both. 3 years, or 180 penalty units, or both. 2 years, or 120 penalty units, or both. 12 months, or 60 penalty units, or both. 10 penalty units.
(ii) there is a risk that the money or property will become an instrument of crime; and
(c) the person is negligent as to the fact that the money or property is proceeds of crime or the fact that there is a risk that it will become an instrument of crime (as the case requires)
[12]
Amendments
19 May 2015 - Par 74 - addition of the words 'to decline'
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 19 May 2015
The Crown notes that Ms Jiao later participated in an electronically recorded interview during which she made statements to the effect that the money exchange was facilitated by her elder brothers in Hong Kong; that her brothers had arranged for her to receive $625,000 from an unknown male at The Star who would identify her by the name "Jacqueline" and through the serial number of a $5 note in her possession; and that her brothers wanted her to send half the money to China.
The Crown also notes that examination of the mobile telephones found in Ms Jiao's possession at the time of her arrest revealed a number of text messages from her son, Charles Harsono, with instructions to Ms Jiao to make cash deposits including into a Commonwealth Bank account in the name of Anna Yu.
Ms Jiao pleaded not guilty. She gave evidence at the trial as did her brother (Mr Shou Cheng Jiao) and two of her sons, Charles and William Harsono. Transcript of the hearing was not before this Court.
Ms Jiao sought to defend the charge pursuant to s 400.9(5) of the Criminal Code on the basis that she had no reasonable grounds for suspecting that the money the subject of the charge was derived or realised, directly or indirectly, from unlawful activity.
Her case at trial, as outlined in the Crown's submissions on this appeal from which Ms Jiao does not demur, was that the Australian currency the subject of the charge had been obtained by her brother (Mr Sheng Chou Jiao) in order that one of Ms Jiao's sons (William), who had operated a coffee cart in Taiwan, might move to Australia and open another such business in Sydney and so that Mr Jiao might purchase a "ranch" as a retirement property in Australia. It was asserted that the means by which Ms Jiao was to be identified by the possessor of the currency (i.e., Mr Nguyen), namely the use of the particular $5 note, was because Ms Jiao had told her brother that she was gambling and that it was inconvenient for her to leave the gaming tables and go to her hotel room (in The Star) to arrange some other form of identification such as her passport. Pausing here, it must be noted that such an explanation for the adoption of this process of identification was inherently implausible since Ms Jiao had to leave the gaming tables in any event to collect the sports bag from the car park, take it to her hotel room and then return to the Sovereign Room to deposit the cash.
The Crown notes that Ms Jiao's evidence was that, on taking receipt of the money, she banked it into her account held with The Star in order to increase her chances of obtaining further "perks" from the casino. The defence case was that the very same day after she took receipt of the Australian currency Mr Jiao happened to require those funds back in China, that Mr Jiao had made contact with her son Charles (who, as noted above, carried on business in New Zealand as a money remitter) in order to ask for him to arrange it to be transferred back to China to be converted to RMB currency and that Charles then made arrangements for the transfer of the money and communicated them to Ms Jiao.
The submissions on sentence made on behalf of Ms Jiao (MFI 56 in the District Court) included that Ms Jiao believed, all the time until told otherwise by her brother, that the money would be banked into her bank account and that she believed that the money belonged to her brother "through a money remittance transaction".
The Crown points out, and Ms Jiao accepts, that there was no information provided by the defence at the trial as to the origin of the money other than an assertion that it had been "purchased" by Ms Jiao's brother.
The sentencing judge noted (at [10]) that the issue raised by the s 400.9(5) defence was squarely put before the jury and that it had rejected that defence by the verdict of guilty which it returned. For Ms Jiao it is here submitted that, although the jury rejected her defence, it did not necessarily reject her evidence (confirmed by that of her brother) that she had acted at the request of her brother and that there was no evidence that Ms Jiao was involved in a wider criminal enterprise. There were, however, no findings of fact to that effect by the sentencing judge.
So, for example, the maximum penalty for an offence under s 400.5(3) (dealing with $50,000 or more where the person is negligent as to the status or intended use of the money) is the same as that specified for an offence under s 400.9(1) - the relevant difference being that for the latter offence there is no requirement of negligence, but the monetary threshold is doubled. (Section 400.9 also applies only to a dealing with money or property reasonably suspected of being proceeds of crime, not to a dealing where there is a risk that the money or property will become an instrument of crime.) Once the monetary threshold is reduced to $10,000 or more, the maximum penalty for a negligent dealing is less than that provided for an offence under s 400.9(1) (see s 400.6(3)); once it is reduced to $1,000 or more, the maximum penalties for both reckless and negligent dealing are less than for the s 400.9(1) offence (ss 400.7(2) and (3)); and all of the offences under s 400.8 (dealing with money or property of any value), whether done negligently, recklessly or with the prescribed belief or intention, carry a lesser penalty than a s 400.9(1) offence.
Presumably, the statement in Shi v R to the effect that s 400.9 falls at the lowest end of the scale of money laundering offences was drawing a distinction between those offences in which there is a fault element and the s 400.9 offences in which no fault element is required. However, in strict penalty terms, the offence under s 400.9(1) is at least at the level of seriousness as those referred to in [25] above. The Crown submits that, on any view of the legislation, s 400.9 is a very serious offence involving a departure from the common law concept of offending because there is no element of mens rea.
There are a number of general statements in the cases concerning money laundering offences and the mischief to which they are directed. Most of these cases concerned offences under s 400.3 or s 400.4 of the Criminal Code, and thus additional considerations were addressed to those which arise under s 400.9.
Some general statements are contained in R v Li [2010] NSWCCA 125; 202 A Crim R 195 at 200-204 [16]-[42] (concerning ss 400.3 - 400.7); R v Guo; R v Qian [2010] NSWCCA 170; 201 A Crim R 403 at 414-418 [84]-[91] (concerning s 400.4); Majeed v R [2013] VSCA 40 at [34]-[40] (s.400.3); Shi v R [2014] NSWCCA 276 at [43]-[50] (s 400.9 offences after the 2010 amendments); and Almada v R [2015] NSWCCA 19 at [34]-[37] (again an offence under s 400.9 after the 2010 amendments).
More generally, this Court in Milne v R [2012] NSWCCA 24; 259 FLR 42 (at [134]) adopted the following observations of Johnson J in his pre-trial decision of 19 August 2010 (R v Milne (No 1) [2010] NSWSC 932; 260 FLR 166 at [161]-[164]):
[161] When provisions such as the money laundering offences contained in section 400 Criminal Code Act 1995 are enacted, it is clear that care must be exercised by a prosecutor in their use. As the authorities to which I have referred make clear, the money laundering provisions are broad with a capacity to extend to a wide range of circumstances. By their nature, they are likely to be intertwined with other criminal conduct.
[162] By the enactment of these provisions, the Commonwealth has determined that criminal offences of this type are necessary to deal with the wide range of conduct which has manifested itself in contemporary society, with consequences adverse to the public interest including the revenue.
...
[164] At a Commonwealth level, the money laundering offences in section 400 constitute a 21st century response to antisocial and criminal conduct commonly with international elements.
The High Court quashed the s 400.3 conviction in Milne on an issue of construction concerning the term "instrument of crime" (Milne v The Queen [2014] HCA 4; 252 CLR 149) referring to the money laundering provisions in general terms (at [7]-[14]).
What is clear from Shi v R and the other authorities referred to above is that money laundering offences are regarded as very serious offences in respect of which the need for general deterrence is of particular significance. In the present case, his Honour accepted that general deterrence was an important factor to take into account ([12]).
In passing sentence for a s 400.9(1) offence, the sentence or order ought be of a severity appropriate in all the circumstances of the offence (s 16A(1) Crimes Act 1914 (Cth)), taking into account, insofar as is known to the court, the nature and circumstances of the offence (s 16A(2)(a)).
Care is required to be taken so as not to breach the principles in The Queen v De Simoni [1981] HCA 31; 147 CLR 383 at 389. In imposing sentence, the court is entitled to consider all the conduct of the offender, including that which would aggravate the offence, but is not permitted to take into account circumstances of aggravation which would have warranted a conviction for a more serious offence (see also Shi v R at [47]-[48]).
At the same time, care is required to avoid a type of reverse De Simoni error, by taking into account on sentence for a s 400.9 offence the absence of features which would have rendered the offender liable to conviction for another money laundering offence punishable by a greater penalty. The point is illustrated in R v Guo; R v Qian at 419 [99]:
With respect to Mr Guo, an assessment of the objective seriousness of his crime involves consideration of factors referred to in the authorities set out at [85]-[91] above. Mr Guo dealt with an amount of $716,394.73. There was a significant degree of planning and deceit involved in the commission of his offence. Although he pleaded guilty to an offence of recklessly dealing with the proceeds of crime under s 400.4(2), the level of criminality involved for that offence may be characterised appropriately as high. It should be kept in mind that the maximum penalty of 10 years imprisonment in s 400.4(2) applies only to offences of recklessness to a risk that the money was the proceeds of crime. It does not assist Mr Guo to contend that his crime was one involving recklessness rather than belief or intention that the money was the proceeds of crime, as the latter conduct constitutes a separate and more serious offence under s 400.4(1) with a maximum penalty of 20 years imprisonment.
And see R v Nguyen [2013] NSWCCA 195; 234 A Crim R 324 at 335 [49]-[52].
His Honour noted that Ms Jiao was not entitled to any discount for an early plea of guilty ([17]); that the Crown had acknowledged that Ms Jiao's prospects of rehabilitation must be good, this being her first offence and the police acknowledging that there was no record of any other criminal behaviour on her part ([18]); and that Ms Jiao was a foreign national with no family here ([20]). His Honour accepted that there was no victim as such and that there was no actual loss because the money was confiscated ([21]). His Honour also accepted the submission for Ms Jiao that the offence was "relatively unsophisticated" and accepted that it was unlikely that Ms Jiao would re-offend ([21]).
The Crown takes issue with the proposition that the offending was relatively unsophisticated having regard to the planning and contemplation involved in the use of the $5 bank note for identification, but again does not challenge that finding on this appeal.
His Honour took into account that it appeared Ms Jiao was cooperative in her interview with the police as well as her age (55 at the time), the fact that she was a foreign national for whom a custodial sentence would be difficult, and the fact that she had no previous convictions ([23]).
Having had regard to comparative cases, relevantly Shi v R, Assafiri v R [2007] NSWCCA 159 and Cahyadi v R [2007] NSWCCA 1; 168 A Crim R 41, and noting the importance of general deterrence and the fact that both the legislature and the courts regard this kind of offence as very serious, his Honour concluded that an appropriate sentence in all the circumstances was one of 6 months' imprisonment.
The Crown submits that the description by his Honour of the role and involvement of Ms Jiao as not "fleeting or transitory" did not adequately address what the conduct actually was and contends that Ms Jiao had a considerable and intimate involvement with the money in that: she received the money in "less than straightforward" circumstances, she banked it into her account and she then took steps to transfer the money the next day. It is submitted that the conduct bore all the hallmarks of a professional money laundering arrangement for the remittal of the money under a cloak of respectability.
For Ms Jiao, it is submitted that, despite the amount involved, Ms Jiao's actions were "relatively brief and transparent". Emphasis is placed on the fact that her dealing with the money took place over a short period (and that, had it not been a Sunday when she received the money, it could otherwise have occurred all on the one day); that the dealing was unsophisticated in nature, in that Ms Jiao used her own name not a false name and used an account in her name; that the offence was not at her own instigation (though there was no finding expressly as to this); and that it involved only one course of dealing with only one bundle of cash, with no attempt to "structure" the money through gambling or to "wash the money" by exchanging it for gambling chips (though it must be noted that there was in a sense the "washing" of money through its deposit into Ms Jiao's casino account and subsequent withdrawal). Use of the $5 note identification procedure also belies the suggestion of an unsophisticated transaction.
Insofar as the Crown submits that Ms Jiao's role was more than that of a "bagman" or "mule", it should be noted that in the context of drug supply and importation offences it is recognised that problems may emerge when a sentencing court attempts to categorise the role of the offender in the drug enterprise (as principal, courier, drug mule or the like) since in many cases the full nature and extent of the enterprise is unlikely to be known to the court (see The Queen v Olbrich [1999] HCA 54; 199 CLR 270 at 279 [19]; R v Lee [2007] NSWCCA 234 at [25]; R v Nguyen; R v Pham [2010] NSWCCA 238; 205 A Crim R 106 at 126 72). In The Queen v Olbrich, it was said at 279 [19] that "[c]haracterising the offender as a 'courier' or a 'principal' must not obscure the assessment of what the offender did".
In the same way, description of Ms Jiao's offence as being "relatively unsophisticated" (as his Honour accepted at [21]) tends to mask or blur fact finding and assessment of objective gravity in this case. This is particularly so as that characterisation was adopted without a more complete recital of the facts and evidence, including the expert evidence concerning the use of the $5 bank note's serial number.
The Crown's submission that the criminality of Ms Jiao's offence was nowhere near the lowest end of this kind of offence (having regard not only to the amount of money and time period involved but also to the degree of Ms Jiao's involvement, including in conduct that, according to the expert evidence adduced at the hearing, fell squarely within well recognised practices engaged in for the purposes of money laundering) must be accepted.
The Crown further submits that there was no substantial mitigation beyond evidence of prior good character. In this regard, Ms Jiao points to the degree to which she cooperated with law enforcement agencies in the investigation of the offence. It was not disputed that, but for Ms Jiao volunteering information as to the use of the $5 note for identification purposes, this would not have been known to the authorities. Insofar as the use of that process was a significant factor in leading to the objective conclusion that the money was reasonably suspected of being the proceeds of crime, Ms Jiao's co-operation with the authorities therefore seems to have been a critical element in the proof of the offence with which she was charged.
In Assafiri v R, the offender pleaded guilty to three counts of making a false statement and one count of possession of property reasonably suspected of being proceeds of crime contrary to s 400.9(1) (the applicable maximum penalty of imprisonment there being 2 years). The sentencing judge was asked to take into account 19 further offences of money laundering as well as a mixture of State and Federal offences relating to the use of false identification or false statements in order to perpetrate the money laundering offences. The relevant offence for present purposes was the single s 400.9(1) offence which the Crown notes related to possession at a single point in time.
While that conduct was part of protracted criminal offending over a period of six months using false identities in which the offender acquired two companies, opened five bank accounts, one in the name of one of his false identities and two in the name of each of the companies, the s 400.9 offence related to the possession of a sum totalling $290,020, around half the amount involved in the present case. It was accepted at the sentencing hearing that the offender did not own the money that he had transferred (relevant to the other charges) and that he was acting on behalf of another person. There was no discount for assistance (since the effectiveness of his assistance to the authorities was minimal).
Mr Assafiri had pleaded guilty. He was of prior good character and it was accepted that he had good prospects of rehabilitation. The sentencing judge had imposed a penalty of 9 months imprisonment for the s 400.9(1) offence. On appeal, that sentence was quashed and a penalty of 6 months' imprisonment (25% of the applicable maximum term of imprisonment) was imposed. The Crown submits that this was a considerably lesser offence, at a single point in time, and Mr Assafiri had the benefit of a discount for his guilty plea, yet the period of imprisonment in the present case was the same.
In Cahyadi v R, the applicable maximum term of imprisonment was again 2 years. The amount of money involved for the purposes of the s 400.9 offence was $155,600. The offender, who had pleaded guilty, had a criminal record for dishonesty and had used a false name to enter the country. The dealing in question related simply to the possession of the money but there was evidence that the offender was in possession of a computer program for making false passports and false driver's licences, as well as several passport size photographs of a different person (relevant to other of the offences for which he was convicted). The offender had opened a false bank account and over just under a three month period that had been used on nine occasions to send $89,100 to an account in Indonesia, but the relevant s 400.9 offence related to bare possession of the moneys suspected of being proceeds of crime. The offender was sentenced to 1 year's imprisonment.
Finally, reference is made to Almada v R where the offending conduct occurred on a single occasion over a relatively short period of time, the quantum involved was just over double the minimum threshold of $100,000, and there was a plea of guilty. The offender had a prior criminal record for a few relatively minor matters but was subject to a good behaviour bond at the time. He had a longstanding drug use problem. His guilt in respect of a further offence (attempting to move out of Australia without a report a sum of cash exceeding $10,000) was taken into account at the same time. Mr Almada was sentenced to imprisonment for 18 months with release on entry into a recognizance pursuant to s 20(1)(b) of the Crimes Act to be of good behaviour for a period of 3 years. This Court was clearly of the view that the sentence could not be characterised as manifestly excessive and refused leave to appeal against sentence.
Having regard to the above cases, the Crown submits that his Honour in effect sentenced Ms Jiao as if her offending was at the lowest end of the range of offences of this kind and that this was not the correct way to characterise the seriousness of her offence (namely this being in the middle of the range of seriousness) and was manifestly inadequate in the absence of any substantial mitigation beyond prior good character. The Crown argues that such a sentence leaves little room for a sentence of appropriate severity to have been imposed had the criminality been lesser or had there been any substantial mitigation present.
The Crown submits that the key issue when sentencing for a s 400.9 offence is the amount of money involved, noting that in the present case the threshold was exceeded by more than six times, though noting the other matters identified as relevant by Barr AJ in R v Li at 204 [41]:
… It seems to me, without undervaluing the importance of the principal differentiating factors - minimum value of money or property and state of mind - that each case will have other variables that appear on sentence. Perhaps the most important will be an exact appreciation of what the offender did, what acts he performed and with what authority and over what period of time. The total value of money or property involved will be important, and whether the money or property belonged to the offender or to another. The degree of planning or deceit that led to the commission of the offence and whether actual loss resulted, and the extent of such loss, will be important. …
Ms Jiao submitted that there was a significant disparity between her criminality and that of the other offenders in the comparable cases referred to on sentence, where the offences took place over a period of months, with "sustained criminal offending with much subterfuge". In that regard, Ms Jiao pointed to the protracted nature of the criminal offending and use of false identities in Assafiri v R; the fact that in Cahyadi v R the offence was part of a "bigger picture" and the offender had a criminal record for dishonesty and had operated a false bank account; and that in Shi v R, there was a sustained period of offending over a period of two months involving multiple transactions and large amounts of money as part of a sophisticated "black money" scheme. In contrast, emphasis is placed on Ms Jiao's co-operation with the police and the authorities.
There is no evidence of any distress or hardship, beyond that which one would expect someone in Ms Jiao's position to suffer, as a result of Ms Jiao's custodial sentence, or as a result of the prospect that a sentence of imprisonment might be increased if the Crown appeal succeeds. Insofar as she is a foreign national, the Crown does not submit that this carries no weight, but submits that in the circumstances it carries little weight - Ms Jiao having come to this country for the purpose of committing the offence (R v Ferrer-Esis (1991) 55 A Crim R 231 at 239). As to the submission based on Ms Jiao being otherwise of good character, the Crown submits that this has limited weight where general deterrence is so important.