The Commissioner of the Australian Federal Police v Omar

The Commissioner of the Australian Federal Police v Omar - [2021] NSWSC 366 - NSWSC 2020 case summary — Zoe

Judgment

This judgment deals with some of the claims for final relief under the Proceeds of Crime Act 2002 (Cth) ("POCA") made by the plaintiff, the Commissioner of the Australian Federal Police (the "Commissioner"). In particular, the Commissioner seeks orders under s 47 of the POCA that the property listed in the Schedule to this judgment be forfeited to the Commonwealth. The Commissioner also seeks pecuniary penalty orders under s 116 of the POCA in the total sum of $29,787,645.96 against the first and second defendants to the proceedings, Ibrahim Omar and Mohammad Omar.
This part of the proceeding was heard on 8 October 2020. Although they were given more than sufficient notice of the hearing neither Ibrahim Omar, Mohammad Omar nor any of the third to six defendants, appeared at the hearing. The third to sixth defendants are companies ("Corporate Entities") that were owned and controlled by the first two defendants during the relevant period, namely Teach Australia Group Pty Ltd ("Teach"), Panacea Enterprises Pty Ltd ("Panacea"), Surpass Australia Pty Ltd ("Surpass") and Interactive Workforce Solutions Pty Ltd ("Interactive Workforce").
In substance, the Commissioner contends that orders should be made because each of Ibrahim Omar and Mohammad Omar were the principals of a scheme that used the Corporate Entities as a means to fraudulently claim child care benefits ("CCB") from the Commonwealth (and that the requirements for the making of orders under POCA were otherwise satisfied). As explained below, during the relevant periods the Corporate Entities provided, or purported to provide, Family Day Care ("FDC") services. The Commissioner contends that the approvals they obtained to operate as FDC's were fraudulently procured and they submitted false data to the Commonwealth Department of Education and Training ("DET").
For the reasons that follow, I will grant most of the relief sought by the Commissioner, although I do not accept every aspect of the Commissioner's case. In particular, I accept one of the Corporate Entities obtained its approvals by deception but not the remainder. However, I accept that false data was submitted by all of the Corporate Entities to DET to obtain CCB and I accept that was orchestrated by Mohammad Omar and Ibrahim Omar. I am satisfied that each of Mohammad Omar, Ibrahim Omar and the Corporate Entities engaged in conduct that constituted offences under the Schedule to the Criminal Code Act 1995 (Cth) (ie the "Code") namely s 134.2, s 135.1(3) and s 400.9(1).
To explain these conclusions, it is first necessary to explain the operation of the POCA, the scheme for obtaining approvals and CCB before outlining what the evidence demonstrates in relation to the conduct of Ibrahim Omar and Mohammad Omar.

[4]

POCA - Forfeiture

Section 47 of the POCA deals with forfeiture orders. It provides: "47 Forfeiture orders - conduct constituting serious offences (1) A court with *proceeds jurisdiction must make an order that property specified in the order is forfeited to the Commonwealth if: (a) the *responsible authority for a *restraining order under section 18 that covers the property applies for an order under this subsection; and (b) the restraining order has been in force for at least 6 months; and (c) the court is satisfied that a person whose conduct or suspected conduct formed the basis of the restraining order engaged in conduct constituting one or more *serious offences. Note: The order can be made before the end of the period of 6 months referred to in paragraph (1)(b) if it is made as a consent order: see section 316. (2) A finding of the court for the purposes of paragraph (1)(c) need not be based on a finding as to the commission of a particular offence, and can be based on a finding that some *serious offence or other was committed. (3) The raising of a doubt as to whether a person engaged in conduct constituting a *serious offence is not of itself sufficient to avoid a finding by the court under paragraph (1)(c). Refusal to make a forfeiture order (4) Despite subsection (1), the court may refuse to make an order under that subsection relating to property that the court is satisfied: (a) is an instrument of a *serious offence other than a *terrorism offence; and (b) is not proceeds of an offence; if the court is satisfied that it is not in the public interest to make the order."
The first precondition to the making of a forfeiture order under s 47 is that the Commissioner, being the "responsible authority", applied for the order. That condition has clearly been complied with. The second condition is that "the restraining order" has been in force for at least six months, that being the "restraining order under section 18 that covers the property" that is the subject of the application for the forfeiture order (s 47(1)(a)). In this case, restraining orders were made over the property in the Schedule on 8 August 2016 by Fagan J. (The relevant order number made by His Honour in respect of a particular item of property is set out in the right-hand column of the Schedule). It follows that the second condition has been complied with.
There remains the third condition namely whether "the court is satisfied that a person whose conduct or suspected conduct formed the basis of the restraining order engaged in conduct constituting one or more serious offences". As will become evident, this is the substantive issue raised by this application. In his judgment of 8 August 2016, Fagan J was satisfied there were reasonable grounds to suspect that each of the first to sixth defendants had committed serious offences.
As noted, on this application the Commissioner contends that the first to sixth defendants engaged in conduct that constituted offences under s 134.2, s 135.1 and s 400.9(1) of the Code. The alleged offences under s 134.2 and s 135.1 are "serious offences" as they are punishable by more than 3 years imprisonment and individually or collectively caused a benefit of more than $10,000 for a person (s 338, (a)(iii), (aa)(ii)). The offence under s 400.9(1) is by definition a "serious offence" (s 338, (a)(ii)).
The standard of proof in these proceedings is the balance of probabilities. The Commissioner bears the onus of proof. In considering whether the Commissioner has discharged his onus I have considered the nature of the cause of action, the subject matter of the proceedings and the gravity of the allegations against the first to sixth defendants (Evidence Act, s 140(2); Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34).
Otherwise, I note that s 47(4) enables the Court to decline to make a forfeiture order in respect of certain property on public interest grounds. The evidence did not raise any basis for the exercise of this power.

[6]

First Limb: Approvals to Provide Family Day Care

In New South Wales, the provision of childcare is regulated by the Children (Education and Care Services) National Law Act 2010 ("National Law"). [5] During the period the subject of these proceedings, the relevant regulating authority was the New South Wales Department of Education (the "NSW Department").
Family day care is a form of childcare that is provided in an educator's own home (the "educator") as distinct from a childcare centre or playground. To provide a family day care service, an entity was required to obtain service approval pursuant to s 48(1) of the National Law ("service approval"). There were several prerequisites specified by the National Law to obtain "service approval". To obtain a service approval a child care provider must have, amongst other matters, applied for or received "provider approval" pursuant to s 15(1) of the National Law ("provider approval") (s 43(1); s 49(1)(b)).
According to an affidavit of Ms Agnes Bishop, who is a Manager in the Statewide Operations Network within the Early Childhood Education division of the NSW Department of Education and Communities, to receive provider approval the relevant service provider must have had a "nominated supervisor". [6] She stated that a nominated supervisor is a person who has been issued a Supervisor Certificate pursuant to former s 111(1) of the National Law and consented to the nomination. The necessity for a provider approval application to include a nominated supervisor was not a requirement imposed by the National Law, [7] although for the relevant period an application for Service Approval had to nominate a certified supervisor to be nominated supervisor for the service and include that person's written consent to the nomination (s 44(1)(d)). [8] As I was not provided with a copy of the "National Law Regulations", [9] I could not determine whether those regulations imposed a requirement for a provider approval application to include a Nominated Supervisor.
Former Part 4 of the National Law [10] dealt with Supervisor Certificates. Section 105 identified their purpose as being to make "the person to whom it is issued eligible to be placed in day to day charge of an approved educational care service". Section 107 provided that the application must be made in writing and signed by the applicant, include the "prescribed information" and include payment of the prescribed fee. Section 108(1) provided that the relevant applicant for the Supervisor Certificate must have satisfied the regulatory authority that they are a "fit and proper person to be the supervisor of an education and care service" and "meet… the prescribed minimum requirements for qualifications experience and management capability". Under clause 17 of the Children (Education and Care Services) Supplementary Provisions Regulation 2012, these qualifications included possession of: "(i) the required abilities to care for children and the capacity to exercise overall supervision of the provision of an education and care service; (ii) successful completion of an approved course in child protection (being a course that covers all applicable requirements under the applicable child protection legislation); (iii) one or more of the following qualifications: 1. an approved degree or diploma in early childhood education from a university following a course with a duration (on a full-time basis) of not less than 3 years; 2. a Diploma of Children's Services (Early Childhood Education and Care), a Child Care Certificate, a Certificate of Child Care Studies or an Associate Diploma of Social Science (Child Studies) from a registered training organisation; 3. another approved qualification; and (iv) 12 months' full-time experience or its equivalent in part-time experience in providing a relevant education and care service (gained after obtaining the qualification referred to in paragraph (iii)." [11]
Ms Bishop stated that, upon receipt of an application for a Supervisor Certificate, persons within her section reviewed the information provided and assessed it against the matters and factors set out in s 109 of the National Law. [12] Ms Bishop stated that "[a]mong other things it was necessary that the applicant had provided a copy of an approved child care Diploma or other qualification and details of prior experience". [13]

[8]

Surpass Trading as Play School Family Day Care: Service Approval and CCB Approval

Surpass was incorporated on 7 January 2013. From that day until 21 October 2013, its sole director and shareholder was Muhammad Abdullah Abdelrazek. From 21 October 2013, its sole director and shareholder was Ibrahim Omar. From 12 September 2013 to 24 September 2018, it traded under the name "Play School Family Day Care". [19] In his compulsory examination, Ibrahim Omar stated that his brother, Mohammad, arranged for the purchase of Surpass from Mr Abdelrazak. [20] I accept that contention. It is consistent with the balance of the evidence.
On 8 March 2013, an application for a Supervisor Certificate was submitted to the NSW Department identifying the applicant as Faten Metwally. The application was signed by Ms Metwally and included, as an attachment, her academic transcript from Bankstown Community College which revealed she had a Certificate III in Children's Services. [21] Another attachment was a certificate recording she had a Diploma in Children's Services from the Academy of Training. [22] Ms Metwally was granted a Supervisor Certificate on 28 March 2013. [23] It is not contended that there was anything false or misleading provided in support of that application.
On 6 September 2013, an application for a Supervisor Certificate was submitted to the NSW Department identifying the applicant as Muhammad Abdullah Abdelrazek. [24] Part 1B of that application asked five questions numbered 6 to 10. [25] Question 6 asked whether the applicant had adequate knowledge and understanding of the provision of education and care to children. A box was ticked "Yes" indicating that an attachment was included as evidence of the applicant's knowledge and understanding. Question 7 asked whether the applicant had the ability to effectively supervise and manage an education and child care service. The application ticked a box indicating "Yes" which also indicated that evidence was attached of the applicant's management ability. Question 8 asked whether the applicant had either an approved diploma qualification or an approved early childhood teaching qualification. Again, the applicant ticked an indication "Yes" which also indicated that attached was evidence of the approved qualification. Question 9 asked whether the applicant had at least three years' experience, full-time or part-time, working as an educator. The applicant also ticked a box indicating "Yes" and that evidence was attached of his experience as an educator. The application was signed by Mr Abdelrazek with a copy of his passport.
Attached to the application was a resume in Mr Abdelrazek's name which indicated that in 2008 he received a Diploma of Children's Services in the "Academy of Training". [26] The resume also indicated that, from January 2013 to August 2013, he worked as the "toddler room leader" at the Gracelands Early Education Centre, that from February 2009 to December 2012, he worked as the preschool room coordinator at the "Kinderland Early Childhood Learning Centre Castle Hill" and that from February 2009 to December 2010 he worked as a team member at the "Kinderland Castle Hill, Glenhaven and West Pennant Hills Centres". [27] Also attached was a certificate entitled "Academy of Training" which was said to certify that Muhammad Abdelrazek had been assessed as fulfilling the requirements for a "Diploma in Children's Services CHC50302". [28]
Based on the material submitted in support of an application for provider approval noted in [29] and the granting of that approval I infer that Mr Abdelrazek's application for a Supervisor's Certificate approval was granted.
On 13 September 2013, an application for provider approval in the name of Surpass trading as Play School Family Day Care was lodged with the NSW Department. [29] The form specified Mr Muhammad Abdelrazek as the person with management or control of the education and day care service. [30] Accompanying the application was a document entitled "Declaration of Fitness and Propriety" completed by Mr Abdelrazek. In answer to a question as to whether, in the previous three years, he held any role with an education and child care service or a children's service, Mr Abdelrazek referred to his alleged experience with the Gracelands Early Education Centre as a "toddler room leader" and a Kinderland Early Childhood Learning Centre as an "educational leader". [31] For the reasons noted below, I am satisfied that statement was false to the knowledge of Mr Abdelrazek.
On or about the same day, Surpass lodged an application for a service approval. [32] That form nominated Mr Abdelrazek as the nominated supervisor and identified his "Supervisor Certificate number as CF40019706". [33] Provider approval was granted on 23 September 2013 [34] and service approval was provided on 14 October 2013. [35]
On or about 16 October 2013, an application for a Supervisor Certificate was submitted to the NSW Department identifying the applicant as Ibrahim Omar. The application was signed by Ibrahim Omar and accompanied by a copy of his driver's licence. In all other respects it was completed in the same way as that of Mr Abdelrazek. The application included a resume that was identical to that of Mr Abdelrazek except for a substitution of the name Ibrahim Omar for Mr Abdelrazek's name. [36] It also included a certificate from the Academy of Training. [37]
Based on the material submitted in support of an application to change the conditions attaching to the provider approval noted in [33] and the granting of that application, I infer that Ibrahim Omar's application for a Supervisor Certificate was granted.
As noted, on 21 October 2013 Ibrahim Omar became the sole Director and Shareholder of Surpass.
On the same day, a number of forms were filed providing for Mr Ibrahim Omar to take over as Surpass' nominated supervisor upon Mr Abdelrazek ceasing to be employed. [38] These forms identified a certified supervisor number of "CS40021411" for Mr Ibrahim Omar. [39] It also included a declaration of fitness and propriety completed by Mr Ibrahim Omar similar to that noted above. It also referred to his (alleged) previous experience as an educational leader at Kinderland Early Childhood Learning Centre as a team member at Gracelands Early Education Centre. [40] The provider approval was amended accordingly with effect from 22 November 2013. [41]
An affidavit sworn by Elizabeth Mary Russo, a director of the Gracelands Early Education Centre, confirmed that neither Ibrahim Omar, nor Muhammad Abdelrazek, ever worked at that centre. She had never met them. [42] An affidavit of Mark Wharton sworn 25 June 2020, who is the owner and director of eight Kinderland Early Learning Centres, including the Kinderland Early Learning Centres at Castle Hill, Glenhaven and West Pennant Hills Centres, confirms that Mr Abdelrazek and Mr Ibrahim Omar never worked at those centres. Mr Wharton has never met them. [43] An affidavit of Amal Atteya sworn 24 July 2020, who is the Chief Executive Officer of the Academy of Training, confirms that there are no records concerning either Mr Ibrahim Omar or Mr Abdelrazek having ever studied at that institution. [44]
In his compulsory examination, Ibrahim Omar was asked about the circumstances in which he signed his application for a supervisor's certificate. He said he generally "I don't remember …. but all I remember at that time, there was forms that needed to be done, and these forms were prepared." He asserted that "my brother got me some documents which he and Abdul Raziq had prepared and they just said to me 'Your' - you know. Where - you now, 'You now need to sign these documents', so I signed them, and that's - yes." [45] Given the closeness of the association between the two brothers and my acceptance of Ibrahim Omar's assertion that his brother arranged for the purchase of Surpass, I accept that Mohammad Omar and Mr Abdelrazek assisted in the submission of the application for a Supervisor Certificate that contained false or forged documents. However, I am also satisfied that Ibrahim Omar was cognisant of what he was signing and its falsities.
Having regard to this evidence, I am satisfied to the requisite standard that the certificates purporting to be from the Academy of Training provided in support of each of Mr Abdelrazek's and Mr Ibrahim Omar's applications for a Supervisor Certificate were false and false to the knowledge of the persons who made the application. I am similarly satisfied that the resumes they each provided were false and false to their knowledge. I am further satisfied that their applications for a Supervisor Certificate were false and false to their knowledge. I am satisfied that Mohammad Omar assisted Ibrahim Omar in the completion and submission of his application for a Supervisor Certificate and was aware of its falsities and was also aware that the certificate purporting to be from the Academy of Training for Ibrahim Omar was fake. I am also satisfied that both Mohammad Omar and Ibrahim Omar were aware that Mr Abdelrazek had provided a false certificate and false CV in support of his application for a Supervisor Certificate and that, based on that, Surpass had obtained Provider Approval and Service Approval.
On 11 November 2013, an application form for CCB Approval was submitted on behalf of Surpass. [46] The application form bore the electronic signature of Ibrahim Omar [47] and included a copy of the Service Approval. [48] It listed the name of two authorised contacts as Ibrahim Omar and, his father, Sam Omar. [49] The application was approved by Ms Marte on 14 November 2013. Ms Marte stated that had she known that any material in the CCB approval application was false or misleading then she would not have approved the application. [50]
As noted, from 9 January 2014 to 10 August 2016, Surpass received $13,154,536.79 in CCB. [51] All of the payments made during that period post‑date the above approvals.
I am satisfied that the Service Approval, and in turn the CCB Approval granted to Surpass trading as Play School Family Day Care, was procured as a result of the knowingly false documents and declarations made by Mr Abdelrazek and Ibrahim Omar with the knowing assistance of Mohammad Omar. I am satisfied that both Mohammad Omar and Ibrahim Omar were aware of, and facilitated the obtaining of, Service Approval and CCB approval using those false documents.

[9]

Interactive Workforce Solutions t/as Interactive Family Day Care: Service Approval and CCB Approval

Interactive Workforce was incorporated on 18 May 2013. From 18 May 2013 to 23 September 2013, its sole Director and Shareholder was Muhammad Abdelrazek. Thereafter, until 15 October 2017, its sole Director and shareholder was Mohammad Omar. From 12 September 2013, it traded under the business name "Interactive Family Day Care". [52]
On 18 October 2013, an application was made to the NSW Department for Provider Approval on behalf of Interactive Workforce. [53] The application form was signed by Mohammad Omar as Director. [54]
Accompanying the application for Provider Approval was a "Declaration of Fitness and Propriety" completed by Mohammad Omar. [55] In that form he identified himself as a "Person with Management or Control" of Interactive Workforce within the meaning of the National Law. He answered various questions such as whether he had a criminal record or was bankrupt. The form of the declaration was as follows: [56] "I declare that: 1. The information provided in this declaration (including any attachments) is true, complete and correct; 2. I have read and understood and I agree to the conditions and the associated material contained in this form; 3. I understand that the Regulatory Authority and/or ACECQA will have the right (but will not be obliged) to act in reliance upon the contents of this form, including its attachments; 4. I have read and understood my legal obligations under the Education and Care Services National Law; 5. The Regulatory Authority is authorised to verify any information provided in this form; 6. Some of the information provided in this form may be disclosed to Commonwealth for the purposes of the Family Assistance Law and may be disclosed to other persons/authorities where authorised by the Education and Care Services National Law or other legislation; and 7. I am aware that I may be subject to penalties under the Education and Care Services National Law if I provide false or misleading information in this form."
On 23 October 2013, Interactive Workforce received Provider Approval. [57]
On 30 October 2013, Interactive Workforce applied for Service Approval. [58] The application was signed by Mohammad Omar as Director. [59] The application nominated Mrs Metwally as the Certified Supervisor and included her Supervisor Certificate reference number. [60] Service approval was granted on 4 December 2013. [61]
On 28 January 2014, an application for CCB Approval was submitted to the Commonwealth Department on behalf of Interactive Workforce. [62] Mohammad Omar was listed as the "representative" and it was stated that he had an "interest in/operated" Friends Family Day Care since June 2013. [63] Both Ibrahim Omar and Mohammad Omar were listed as the "Service Contacts". [64] The form bore the electronic signature of Mohammad Omar. [65] A copy of the service approval was attached to the application. [66]
The application for CCB Approval was granted by Ms Marte on 6 February 2021. She states that, when she approved the application, she had available a background check on Mohammad Omar which "did not show any previous complaints or adverse compliance findings". [67]
From 11 April 2014 to 10 August 2016, Interactive Workforce received $10,937,416.41 in CCB. [68]
To this point, nothing in the chronology of the granting of service approval or CCB approval to Interactive Workforce suggests they were procured by fraud. After the hearing, the Court queried with the Commissioner's legal representatives the basis upon which it was asserted that they were so procured. In a supplementary submission dated 12 October 2020, Counsel for the Commissioner referred to the circumstances in which Mohammad Omar acquired Interactive Workforce and contended as follows: [69] "(i) MO may have purchased Interactive with Service Approval already in place, although the evidence contradicts this assertion on the part of MO. Even if that assertion were correct, Interactive's approval was obtained improperly because Mr Abdelrazek's qualifications were false (AFP submissions, [49]). (ii) Once MO had purchased Interactive, he was at all relevant times its directing mind and will; and (iii) MO installed Mrs Metwally as nominated supervisor of either Panacea or IWS or both."
I do not accept the first but do accept the second contention. It is clear from the above chronology that Mohammad Omar had assumed ownership and control of Interactive Workforce prior to its application for the above approvals. In relation to the third contention, I accept that Mohammad Omar included Mrs Metwally as the nominated supervisor in the Service Approval application.
The Commissioner's supplementary submission then submitted as follows: "10 MO's declaration that he was a fit and proper person to operate a child care facility was fraudulent in circumstances where MO was a participant, together with IO in a scheme to improperly procure CCB payments for child care services. Examinations of the Omar brothers revealed that they were working in the same office and were involved in each other's business transactions to the extent they concerned purchasing and operating the Corporate Defendants. In the context of questioning about IO's Supervisor Certificate, IO described MO presenting documents to him and saying "You need to sign these documents". The timing of MO's declaration of fitness in connection with the IWS Provider Approval application (18 October 2013) was sufficiently proximate to the date on which IO submitted his fraudulent application for a supervisor certificate (16 October 2013) such that it is unlikely that the two applications did not form part of the same continuum of dishonest conduct, directed at procuring approvals to operate child care facilities in NSW for an improper purpose (i.e. a purpose other than the legitimate provision of childcare under the National Law). 11. Interactive's application for Service Approval was predicated on and contained an implied representation that the pre-requisite approvals were properly obtained and that the application was for a proper purpose, such purpose being the legitimate provision of childcare within the meaning of the National Law. So much is indicated by the declaration that the applicant has "read and understood the Provider's legal obligations under the Education and care Services National Law" (CB 4194). The fact that Mr Omar installed Mrs Metwally as a nominated supervisor purely for the purposes of satisfying a requirement to have a nominated supervisor (without necessarily exercising the proper functions attendant to that role) is inconsistent with the obligations of a childcare provider under the National Law." (emphasis added)
The contention that Mohammad Omar and Ibrahim Omar were working in the same office and were involved in each other's business and that included co‑ordinating the lodgement of approval applications and applications seeking CCB is borne out by the evidence. I accept it. As for the contentions concerning the role of Mrs Metwally in [11] of this submission, the evidentiary references cited in the submission are extracts from the compulsory examination of Mohammad Omar. In those passages Mohammad Omar described a perfunctory discussion he had with Mrs Metwally in 2012 (which appears to be directed to Panacea) for the purposes of including her as a nominated supervisor. [70] Later in the examination, he said that Mrs Metwally eventually worked full time meeting educators and visiting child care centres. [71] He said that she completed inspection reports and they would meet once a fortnight. [72] Nothing in those extracts supports the contention that the engagement of Mrs Metwally was demonstrative of some fraudulent aspect of the applications for approvals.
The first emphasised passage in [10] of the above extract involves circular reasoning. This limb of the Commissioner's case seeks to prove that Mohammad Omar was "a participant, together with IO in a scheme to improperly procure CCB payments for child care services" by reason of his supposedly fraudulent "declaration that he was a fit and proper person to operate a child care facility", not the other way round. The second emphasised passage in [11] of the extract asserts that the application for CCB approval contained some implied representation that the earlier approvals under the National Law were properly obtained. Leaving aside whether or not there was any implied representation then, subject to the next point, there is no evidence that Surpass' approvals under the National Law were improperly obtained.
This leaves the declaration of fitness and propriety described above (at [42]). Despite its name, no part of that document contains any such declaration. It did not ask the applicant whether they were aware of any matter affecting their fitness and propriety (such as Mohammad Omar's involvement in Ibrahim Omar's fraudulent application for a supervisors' certificate). Instead, it posed a series of specific questions none of which were shown to be false and then sought the acknowledgment and approvals set out above. Those acknowledgements did not extend beyond requiring the deponent to "understand" the requirements of the legislation. To prove a fraudulent (or dishonest) representation the Commissioner had to demonstrate that Mohammad Omar intended to convey a representation, that it was false and he knew it was false (Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563; [1995] HCA 68 at 578-579). The Commissioner has not demonstrated that Mohammad Omar intended to convey anything other than he understood certain matters. It has not demonstrated that was false.
The Commissioner has not established the first limb of its case of fraud in relation to Interactive Workforce.

[10]

Panacea Enterprises Pty Ltd t/as Friends Family Day Care: Service Approval and CCB Approval

Panacea was incorporated on 5 January 2012. From 5 January 2012 to 15 June 2014, the directors were Mohammad Omar and Mohamed Metwally. Thereafter, until 26 May 2019, Panacea's sole Director and Shareholder was Mohammad Omar. [73] Panacea had a number of trading names including "Friends Family Day Care" which it used from 9 November 2012 to 24 March 2016.
On 12 November 2012, an application for Provider Approval was made to the NSW Department on behalf of Panacea. Mohammad Omar was listed as the contact person for the applicant. Both he and Mohamed Metwally provided a declaration in similar terms that set out above. [74] Accompanying that application was a Declaration of Fitness and Propriety signed by Mohammad Omar bearing the date 8 November 2012. [75] It was not materially different to the declaration noted above. Provider Approval was granted on 11 March 2013. [76]
Sometime between that date and 14 May 2013, an application for Service Approval was lodged on behalf of Panacea. [77] The contact person was listed as Mohammad Omar. The application also specified Mohammad Omar to be the Nominated Supervisor. [78] Question 26 on the form asked whether the nominated supervisor had a Supervisor Certificate number. A box marked "no" was ticked. [79] Against that box was the following statement: "The individual nominated as the Nominated Supervisor has applied for a Supervisor Certificate but the application has not yet been decided, or the service is seeking a prescribed class Supervisor Certificate. (Note: this Provider Approval Application will not be approved until the Supervisor Certificate for the Nominated Supervisor has been granted.)" (emphasis in original)
Given that this statement was included in an application for Service Approval, the reference to "Provider Approval Application" in the notation appears to be a typographical error.
On 14 May 2013, service approval was granted. [80] The evidence did not address how that occurred without Mohammad Omar having received a Supervisor Certificate.
On the same day, Panacea applied for CCB approval. [81] The application was signed by Mohammad Omar and enclosed the Service Approval. The application was approved on 4 June 2013. [82]
From 28 June 2013 to 10 August 2016, Panacea received CCB payments totalling $1,481,062. [83]
On 15 May 2014, an application for a Supervisor Certificate for Mohammad Omar was submitted to the NSW Department. [84] It included a curriculum vitae and Diploma from Metro College that were identical to those submitted in October 2013 for Ibrahim Omar. [85] Having regard to the evidence noted above, I am satisfied that the entries in the CV were false, the certificate was a fake and that Mohammad Omar was aware of both matters. His application was approved the same day. [86] I am satisfied that it was procured by his fraud.
As with Interactive Workforce, nothing in this chronology of Panacea obtaining provider approval, service approval or CCB approval is demonstrative of their being procured by fraud. The fact that, after they were obtained, a Supervisor Certificate was procured by fraud does not per se taint the earlier approvals. In response to a query from the Court about this the Commissioner's legal representatives submitted as follows: [87] "The conclusion that is underscored by MO's evidence in examination (described above at paragraph [8]) is that any one or more matters existed at the time Panacea applied for Service Approval: (1) MO had purchased the Panacea with pre-existing Service Approvals from Mr Abdelrazek. If that is correct, those approvals were fraudulently obtained because Mr Abdelrazek neither had the appropriate qualifications to procure a Supervisor Certificate nor was he a fit and proper person for present purposes. There is no evidence that Panacea did in fact have those Service Approvals in place. (2) MO installed Mrs Metwally initially as a nominated supervisor. (3) Panacea's application for Service Approval was conditional upon MO obtaining his Supervisor Certificate. For the reasons summarised at AFP submissions [49] - and addressed in the course of oral submissions at the hearing on 8 October 2020 - he was not eligible for that certificate. (4) A prerequisite to Panacea's application for Service Approval was its application for Provider Approval. That application was accompanied by declarations of fitness and propriety by MO and Mr Metwally (Mrs Metwally's son and codirector of Panacea). For the same reasons as set out in paragraph [10] above, MO's declaration that he was a fit and proper purpose for to operate a child care facility was false. Had that been brought to the NSW Department's attention, the Provider Approval would not have been issued. (5) As with Interactive (see paragraph [11] above), Panacea's application for Service Approval was predicated on and contained an implied representation that the prerequisite approvals it had obtained were properly obtained and that the application for Service approval was for a proper purpose, being the legitimate provision of childcare within the meaning of the National Law. For the reasons outlined at paragraph [9]-[11] above (and traversed in detail in the AFP submissions at [48]-[51]), that representation was false and dishonestly so."
The reference to [8] in the opening part of this submission concerns evidence given by Mohammad Omar under compulsion in relation to his acquisition of Interactive Workforce (see [48]). The reference to Mr Abdelrazak and Mrs Metwally in the above submission is puzzling. There is no evidence that Panacea was acquired from him or that Mrs Metwally was ever installed as the Nominated Supervisor, and even if she was, that is not demonstrative of fraud. It is not correct, or even pertinent, to assert that Panacea's application for Service Approval was conditional on Mohammad Omar obtaining a Supervisor's certificate. The standard form simply advised that Service Approval would not be granted until it was granted. That was a statement was made by the NSW Department to the applicant and not vice versa. As events transpired, it was wrong, as Service Approval was granted without Mohammad Omar obtaining a Supervisor Certificate and that was not a condition of the Service Approval either. The effect of the Declarations of Fitness has already been addressed. They do not have the effect contended for. The fifth point is addressed by the findings at [52].
The Commissioner has not established the first limb of its case of fraud in relation to Panacea.

[11]

Teach Australia Pty Ltd t/as "NSW Family Day Care": Service Approval and CCB Approval

Teach was incorporated in April 2011. At that time its directors were Abdelrahman Mahamed and Mostafa Mahamed. From 1 September 2014 to 4 March 2015 its directors were Abdelrahman Mahamed and Ibrahim Omar. Ibrahim Omar was its sole director from 4 March 2015 to 26 August 2018.
Teach began trading under the name "TAG Family Day Care" on 8 April 2013. From 29 August 2013 until 19 January 2017, one of the business names it traded under was "NSW Family Day Care Scheme". [88]
On 2 May 2013, an application for Provider Approval was lodged on behalf of Teach. [89] Abdelrahman Mahamed was named as the contact person. The application was accompanied by a declaration of fitness and propriety completed by Abdelrahman Mahamed. [90] Provider Approval was granted on 4 June 2013. [91]
On 3 September 2013, an application for Service Approval was lodged on behalf of Teach. [92] Abdelrahman Mahamed was listed as the contact and he completed a declaration in the form noted above. [93] The application identified Manell Rifai as the nominated supervisor and provided a supervisor's certificate number for her. [94] Service Approval was granted on 27 September 2013. [95]
On 2 October 2013, an application for CCB approval was lodged with the DET on behalf of Teach. [96] The application bore the electronic signature of Abdelrahman Mahamed [97] and included a copy of the service approval. It was approved on 12 December 2013. [98]
On 19 November 2013, an application was lodged to change the trading name to NSW Family Day Care centre (from TAG Family Day Care). The application was again completed by Abdelrahman Mahamed. The application was approved on 2 December 2013.
From 24 December 2013 to 9 August 2016, Teach received payments totalling $9,072,439.63 in CCB. [99]
On or about 9 October 2014, an application was made to the NSW Department to amend the Nominated Supervisor to Ibrahim Omar. [100] It was accepted by the Commissioner that there is no evidence that this application was granted.
After the hearing, the Court wrote to the Commissioner's legal representatives and asked, inter alia: "Please specify by reference to the specific page number what is the alleged false and misleading conduct that occurred in connection with the grant of those approvals? On 9 October 2014 there was an application to alter the nominated supervisor to Ibrahim Omar (4298). Is there any evidence that that application was granted?"
The Commissioner's legal representatives responded as follows: "No there is no evidence that the application was granted. However, once Service Approval had been granted, it was for the Service to notify of changes to a Service's nominated supervisor at least 7 days before (but no later than 14 days after) the nominated supervisor commenced work: s 56 National Law. It was not an application that required approval by the NSW Department. Mr Deb annexes (tab 2) a list of authorised personnel (i.e. people who are able to input data into CCMS) on behalf of NSW FDC. Ibrahim Omar is included on that list."
The query from the Court noted in [74] requested that the Commissioner identify what the false and misleading conduct was in relation to the approvals granted to Teach. The only matter identified in response was the nomination of Ibrahim Omar as the supervisor on 9 October 2014 which occurred around the time that Ibrahim Omar acquired ownership of Teach and which was ten months after the relevant approvals were all granted. That said, I accept that the Supervisor Certificate referred to was procured by the fraudulent conduct of Ibrahim Omar and Mohammad Omar.
It follows that, to the extent that the Commissioner's case is premised on establishing that the approvals that Teach received to enable it to receive CCB up until October 2014 were procured by fraud, then his case fails. As for the period after then, I will return to address the significance, if any, of the notification of the NSW Department in October 2014 of Ibrahim Omar as the Nominated Supervisor where his Supervisor Certificate had been procured by fraud.

[12]

Second Limb: False Data submitted to the Commonwealth

As noted, the second limb of the Commissioner's case concerned the alleged submission of false data to DET about the number of childcare hours being provided by "educators".
Once a FDC obtained CCB Approval ("CCB Approved Service"), it could report hours of care being provided to children by educators and claim benefits on their behalf. According to the Commissioner, under the CCB scheme there was a cap on the number of hours that could be claimed per child per week and a cap on the number of children per educator. [101] As noted, the CCB could be paid to parents directly as an annual lump sum. Alternatively, it could be paid to the "CCB approved service" who would receive a family's benefit in arrears and apply it against their child care fees to reduce the up-front fees charged to parents. The Corporate Entities used the latter system. Another benefit, the Child Care Rebate ("CCR"), operated in the same manner.
The DET's Child Care Management System (CCMS) was the computer system that the DET used to record sessions of care submitted by CCB Approved Services. The Commissioner's submissions accurately summarised the evidence of the relevant officer of DET, Mr Dwaipayan Deb, concerning the payment system as follows: [102] (1) CCB Approved Services submitted to the DET data of the sessions of care provided by them to children through 'CCMS Registered' software that was capable of interfacing with CCMS; (2) Once the CCMS received those records, the CCMS would automatically verify the eligibility of the children for whom the Benefits were claimed with the Income Security Integrated System (ISIS) which was operated by the Department of Human Services (DHS, now known as Services Australia); and (3) If the CCMS data matched the ISIS eligibility, CCMS would generate a payment request and send it to the Commonwealth's payment system (IMPACT). That system interacted with the RBA to arrange payment to the registered payee. Where that person was nominated in CCMS as the CCB Approved Service, payment would be sent to the service.
The CCMS system recorded information concerning each CCB Approved Service such as details of the children enrolled to receive care at the relevant FDC and the Educators providing care to children.

[13]

The Deception

The nature of the fraud perpetrated by the Corporate Entities is evident from a statement made by Mohammad Omar to police officers late in the afternoon of 13 January 2017 well after the FDCs were shut down. A vehicle he was driving was stopped at the intersection of King Street and O'Connell Street in Newtown. Two police constables were at the scene and requested assistance from Detective Senior Constable Dimovski and Detective Senior Constable Bale. When they arrived at the scene at around 6.00pm, they noticed a sum of cash, illegal weapons, mobile phones, SIM cards and key cards had been discovered in Mr Omar's possession. Mr Omar was ultimately charged with dealing with the proceeds of crime, goods in custody, and possession of a prohibited weapon.
The officers spoke to Mohammad Omar at the scene. Although the conversation was not recorded, immediately afterwards DSC Bale made notes of the conversation and swore to the voracity of those notes in his affidavit. [103] I accept his evidence. During the conversation Mohammad Omar agreed that he was in possession of $25,000 in cash. He was asked why and he said, inter alia, "The AFP are investigating me for fraud and they confiscate any money I have so I have to hide money in other people's accounts. Google me 'Mohammad Omar childcare fraud'". [104]
One part of the conversation was as follows: PCSC DIMOVSKI: So off record, what's the go with this child care scheme fraud? OMAR: Basically, the government gives up to $300 per child per week, all you have to do is set up a home child care for getting an educator certificate. I have a guy I know in Queensland that can do the certificates. They you just find kids to sign up for example, your cousin's kids or friend's kids etc. You can't use your own kids. I would then claim the money for looking after the kids without actually looking after the kids and then the kid's parents would get a cut and I would keep a cut. PCSC DIMOVSKI: How many kids did you have? OMAR: At my peak, about 2000. I/S: What? That's 2000 x $300. PCSC DIMOVSKI: Hold on, how much is that? OMAR: I would see about $200 per kid so about $400,000 a week. PCSC DIMOVSKI: You're telling me you received $400,000 clean per week? OMAR: Yes, I had two homes paid off, a million dollars just sitting in my bank account. PCSC DIMOVSKI: And you haven't been charged? OMAR: No, but I have a matter before the Supreme Court to do with my confiscated assets. PCSC DIMOVSKI: So where do you live now? OMAR: In the same home, I just can't sell them because the AFP have a hold on it. I/S: Ah, like one of those caveats. OMAR: Yeah. I/S: So what's the deal with all that you had today? OMAR: I'm a consultant now. I consult people on how to do this scheme. Everyone's doing it in Southwest Sydney. I/S: But what does that have to do with the money? OMAR: I've been collecting it from people. I do consulting work for. I can't have money in bank accounts because it gets frozen.
This evidence was read without limitation. It is evidence against all the defendants including Ibrahim Omar (Evidence Act, s 60).
In this passage Mohammad Omar identified the three main features of the fraud perpetrated on DET, namely the submission of inflated hours of care to DET, the alleged provision of care by "Educators" with false qualifications and the making of cash payments to parents to perpetrate the fraud. The other evidence obtained by the Commissioner confirms that this occurred.
In relation to falsified hours, during the execution of a Search Warrant in August 2016, the AFP recovered several manila folders containing templates for timesheets that were pre-filled with details of children's names and hours of care provided. They included timesheets completed for two weeks into the future. [105] The AFP also recovered notes which included statements such as "Revise all timesheets from 25 Aug (31 Aug) till now", "move absences across" and "make sure all timesheets are 50 hrs". [106]
Ms Bernadette Massih worked for an associate of Mohammad Omar and Ibrahim Omar, Ayman Hamze, in the administration of the FDC's. In her affidavit she states she was instructed to complete timesheets up to three to four months into the future [107] and in some cases forge the signatures of parents and educators on time sheets. [108] I infer that data formed the basis of the data submitted to DET and was otherwise preserved for audit purposes. Ms Massih identified a formula that was used to maximise the hours claimed which was effectively unrelated to the amounts of hours provided. [109] Evidence to the same effect was given by Ms Ashely Yarza who worked for both Mohammad Omar and, to a lesser extent, Ibrahim Omar. [110] Ms Yarza was also engaged to inspect the homes where family day care was said to be provided. She said that "often" there were children at these properties but sometimes she would find none. [111]
The Commissioner submitted [112] that various telephone intercepts record Ibrahim Omar [113] and Mohammad Omar instructing employees to claim for CCB and CCR irrespective of what hours the children actually attended the Relevant FDCs or the hours that the Relevant FDCs were entitled to claim. I have read the evidence relied on. The conversations all involve Ibrahim Omar and not Mohammad Omar, although one of them concerns a FDC owned by Mohammad. [114] I accept the Commissioner's submission so far as it concerns Ibrahim Omar. Given the conversation noted in [84], I am satisfied that Mohammad Omar was aware of and assisted Ibrahim Omar.
In relation to education certificates, during the execution of the search warrant on 9 August 2016, the AFP located blank certificates and diplomas with notes containing names and word such as "needing certificate" and "$2000, Cert 3". [115] A number of the educators listed for the FDC's were registered to the same address, allegedly providing care on the same days. [116] Some educators had criminal convictions for serious crimes, and committed offences on days that they were alleged to be caring for children. [117] Ms Yarza recounts Mohammad Omar offering her a fake Diploma in Early Childhood Education and Care. [118] Ms Massih states that she was listed as an Educator when she did not act as such. [119] She overheard Mohammad Omar discuss providing people with educational certificates. [120]
In relation to cash payments to parents, Ms Massih stated that every Thursday parents would attend to collect cash payments. She said that the usual procedure was that Mr Hamze would emerge from Ibrahim Omar's office after speaking to him, and on some occasions Mohammad Omar, behind closed doors. Ms Massah said that Mr Hamze then handed cheques written to "cash" to various associates who would then cash the cheques and return the amount collected after deduction of a fee. The cash would then be placed in envelopes addressed to each parent who then attended the office and collected their envelope, [121] although on some occasions Ms Massih would deliver the envelopes to the parents. [122]

[16]

First Limb: Deception in Relation to Approvals

In relation to Surpass, I have accepted the Commissioner's primary case that its Service Approval and in turn CCB Approval were procured by the fraud perpetrated in relation to the obtaining of Supervisor Certificates for Mohammad Omar and Mr Abdelrazak. The Commissioner submitted, and I accept, that it is not necessary to demonstrate that the "deception" referred to in s 134.2(1) was a decision perpetrated on the Commonwealth. Instead, it was sufficient to show that a deception, in this case a deception of the NSW Department, was the effective cause of the loss that was suffered (citing R v Ho (1989) 39 A Crim R 145 at 147). [123] The Commissioner further submitted that, although the deception about the certificates were submitted to the NSW Department at the very commencement of the approval process, that was still sufficient to make them an effective cause of the CCB payments even though other events (including other deceptions) played their role.
The Commissioner relied on King v R (1987) 1 QB 547 where the offenders falsely represented that they were tree surgeons. They advised a homeowner that remedial work was required on trees near the home and quoted for the work which the homeowner accepted but the authorities intervened before funds were paid over. The appellants were charged with attempting to obtain property by deception. In King, the Court accepted that it was open to the jury to determine that "had the attempt succeeded the money would have been paid over by the victim as a result of the lies told to [the victim] by the appellants" (at 554). The causation chain between the deception and the CCB payment is perhaps weaker in this case than in King, however I am nevertheless satisfied that the false certificates were a relevant cause of the approvals being granted and, in turn, CCB being paid.
The next element of the offence is whether there was a dishonest obtaining of the financial advantage. The conduct of both Mohammad Omar and Ibrahim Omar in procuring and submitting fake educational certificates and CV's containing false entries was clearly dishonest according to the standards of ordinary people. I am also satisfied they would have known that it was dishonest. Given that Mohammad Omar was the sole director of Surpass from 21 October 2013 (and he was preceded by Mr Abdelrazek), I am satisfied that Surpass acted dishonestly in relation to the CCB benefits paid from 9 January 2014 to 10 August 2016 (Code, ss 12.2, 12.3(1) and 12.3(2)). Surpass clearly obtained the CCB benefit. Further, both Mohammad Omar and Ibrahim Omar "obtained" the CCB benefit in that they "obtain[ed] it for another person" namely Surpass (see [97]). To the extent it may be necessary, I find that in procuring Supervisor certificates based on fake educational qualifications they did so with the knowledge and intention of later obtaining CCB.
The last element of the offence is that the benefit was obtained from a Commonwealth entity. The CCB was paid by the Commonwealth which is such an entity.
Accordingly, I am satisfied that each of Surpass, Mohammad Omar and Ibrahim Omar engaged in conduct constituting an offence under s 134.2 of the Code in relation to the $13,154,536.79 of CCB received by Surpass from 9 January 2014 to 10 August 2016.
In relation to Interactive Workforce and Panacea I have rejected the first limb of the Commissioner's case. I reached the same conclusion in relation to Teach, however I did not address the significance of the notification of the NSW Department of Ibrahim Omar as the Nominated Supervisor in October 2014. As noted, his Supervisor Certificate was also procured by fraud. However, by October 2014 Teach had been in receipt of CCB Approval and CCB for ten months. There is no evidence that the nomination of Ibrahim Omar caused the NSW Department to take any step in response. In particular there is no evidence that any communication occurred between the NSW Department and DET about the nomination. It had no effect whatsoever on the CCB payments made after that time. It follows that I am not satisfied that any CCB received by Teach was obtained as a result of that deception.

[17]

Deception in Relation to Data Provided to DET

The findings set out in [92]-[93] reveal that there was a deception of DET by the lodgement of data that contained false statements of the hours of childcare that was provided to approved children by (properly qualified) Educators. Given the evidence that the central administration of all the FDC's took place under the strict control of Mohammad and Ibrahim Omar, I am satisfied this deception affected data submitted by all four Corporate Entities and was directed by Mohammad and Ibrahim Omar. The deception was clearly dishonest by the standards of ordinary people. I am satisfied that Mohammad Omar and Ibrahim Omar knew that and their state of mind can be attributed to each of the Corporate Entities.
Was any financial advantage obtained as a result of this deception? The findings in [93] raise a doubt as to whether the financial advantage can be quantified. The material does not enable me to determine precisely how much of the CCB and CCR that was paid were funds to which the Corporate Entities were not entitled, that is, how much was paid as a direct consequence of the deception about the number of child care hours provided and the status of the Educators. However, at least so far as the making of forfeiture orders are concerned, that is not determinative. The fraudulent scheme was not only brazen, it was well organised and was no doubt put in place by Mohammad Omar and Ibrahim Omar as soon as they had control of the relevant entity and obtained CCB approval. Given the scale of the fraud and the amount of CCB that was paid, I am at least satisfied that throughout the relevant periods a substantial amount of CCB was paid as a result of a deception (see [84]). That finding is sufficient for me to conclude that the six defendants whose conduct formed the basis of the restraining orders made by Fagan J engaged in conduct constituting one or more serious offences namely multiple offences under s 134.2 (POCA; s 47(1)(c)). Any doubt about that is removed by s 47(2).
The Commissioner also pressed for findings that the six defendants engaged in conduct that constituted one or more offences under s 135.1(3) of the Code. It provides: 135.1 General dishonesty (3) A person commits an offence if: (a) the person does anything with the intention of dishonestly causing a loss to another person; and (b) the other person is a Commonwealth entity. Penalty: Imprisonment for 10 years.
The findings made above warrant an acceptance of the Commissioner's submission in relation to s 135.1 of the Code. In this context, each of the deceptions that were undertaken dishonestly and obtained a financial advantage were also instances of conduct by the relevant defendant undertaken with the intention of dishonestly causing a loss the Commonwealth in the form of the payment of CCB.
The same applies to the Commissioner's reliance on s 400.9(1) of the Code which provides: "400.9 Dealing with property reasonably suspected of being proceeds of crime etc. (1) 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 3 years, or 180 penalty units, or both."
Section 400.2 of the Code defines the concept of dealing with money or other property as follows: "A person deals with money or other property if the person does any of the following: (a) receives, possesses, conceals or disposes of money or other property; (b) imports money or other property into Australia; (c) exports money or other property from Australia; (d) engages in a banking transaction relating to money or other property."
Each of the Corporate Entities dealt with the proceeds of crime by receiving CCB into their bank accounts. In the case of Mohammad Omar and Ibrahim Omar, Ms Massih observed both of them access the internet banking accounts that received CCB and transfer money. [124] Implicit in Mohammad Omar's conversation with Detective Senior Constable Dimovski and Detective Senior Constable Bale is that he controlled the receipt and direction of funds.
An offence under s 400.9(1) is only made out in relation to dealing with property that is more than $100,000.00. In relation to Surpass, it follows from the above findings that it received over $13 million as the proceeds of crime. In relation to the other three entities, while I cannot quantify the precise amount received as a consequence of the relevant deception, I am satisfied from the sheer scale of the deception that was perpetrated and the total amount of CCB each received that it exceeded in $100,000 in relation to each entity (see [84]). It follows that I am satisfied that that the six defendants engaged in conduct that constituted one or more serious offences under s 400.9(1) of the Code.
It follows that s 47(1)(c) of POCA has been satisfied and forfeiture orders will be made in relation to the property of the six defendants listed in the Schedule.

[19]

Pecuniary Penalty Orders

The Commissioner seeks a pecuniary penalty order against each of Mohammad Omar and Ibrahim Omar under s 116 of POCA. Section 116 provides: 116 Making pecuniary penalty orders (1) A court with *proceeds jurisdiction must make an order requiring a person to pay an amount to the Commonwealth if: (a) a proceeds of crime authority applies for the order; and (b) the court is satisfied of either or both of the following: (i) the person has been convicted of an *indictable offence, and has derived *benefits from the commission of the offence; (ii) the person has committed a *serious offence. Note: The conviction for, or reasonable grounds for suspecting commission of, an indictable offence could be used as grounds for a restraining order under Part 2‑1 covering all or some of the person's property. (3) In determining whether a person has derived a *benefit, the court may treat as property of the person any property that, in the court's opinion, is subject to the person's *effective control. (4) ...
There is no doubt that s 116(1)(a) is satisfied in that a proceeds of crime authority, namely the Commissioner, has applied for the pecuniary penalty order. Further, based on the above findings, s 116(1)(b)(ii) is satisfied in that both of Mohammad Omar and Ibrahim Omar have committed a number of serious offences. It is not necessary to address s 116(1)(b)(i).
Division 2 of Part 2 of Chapter 2 of POCA deals with the determination of the amount of the penalty. Section 121 relevantly provides: 121 Determining penalty amounts (1) The amount that a person is ordered to pay to the Commonwealth under a *pecuniary penalty order (the penalty amount) is the amount the court determines under this Division. (2) … (3) If the offence to which the order relates is a *serious offence, the *penalty amount is determined by: (a) assessing under Subdivision B the value of the *benefits the person derived from: (i) the commission of that offence; and (ii) subject to subsection (4), the commission of any other offence that constitutes *unlawful activity; and (b) subtracting from that value the sum of all the reductions (if any) in the penalty amount under Subdivision C. Note: Pecuniary penalty orders can be varied under Subdivision D to increase penalty amounts in some cases. (4) …
Subsection 121(2)(a) directs attention to Subdivision B for the conduct of the assessment of the "value of the benefits the person derived from the … commission of the offence". Within Subdivision B, s 122 relevantly provides: "Evidence the court is to consider (1) In assessing the value of *benefits that a person has derived from the commission of an offence or offences (the illegal activity), the court is to have regard to the evidence before it concerning all or any of the following: (a) the money, or the value of the property other than money, that, because of the illegal activity, came into the possession or under the control of the person or another person; (b) the value of any other benefit that, because of the illegal activity, was provided to the person or another person; (c) … (d) the value of the *person's property before, during and after the illegal activity; (e) the person's income and expenditure before, during and after the illegal activity. (2) … (3) …" (emphasis added)
Section 124 of POCA provides a means of assessing the value of the benefits a person derived from committing serious offences by using a comparison between the value of their property during or after the illegal activity and the value of their property before the illegal activity. The Commissioner did not attempt that comparison. Instead, the Commissioner contended that Ibrahim Omar and Mohammad Omar derived a benefit of $34,645,455.01, being the total amount of CCB benefit derived by the four Corporate Entities, in circumstances where those entities and the funds they received were under their control or effective control. [126]
There are two difficulties with this contention. First the sum of $34,645,455.01 includes $9,072,439.63 paid to Teach but $229,878.50 of those payments were made prior to 1 September 2014 being the date that Ibrahim Omar became a Director of Teach. [127] It was not shown that either Ibrahim Omar or Mohammad Omar controlled Teach prior to then, although I accept that for all other relevant periods those entities and their funds were under their control.
Second, the contention that the benefit derived from the serious offences was the total sum of $34,645,455.01 appears to assume an acceptance of the first limb of the Commissioner's case for all of the Corporate Entities; ie, that all CCB received by each corporate entity was the result of the fraudulent procurement of their Service Approval and CCB Approval. However, I have only accepted that limb of the Commissioner's case in relation to Surpass and it received $13,154,536.79 in CCB. I rejected it for the other three Corporate entities, although I accepted the second limb of the Commissioner's case.
The question then arises about the quantification of the benefit derived from the acceptance of only the second limb of the Commissioner's case in relation to Interactive Workforce, Panacea and Teach. Section 336 extends the meaning of "derived' to include a benefit derived directly or indirectly. However, that does not assist with the present issue which effectively concerns mixed funds.
Section 116 obliges the Court to impose a pecuniary penalty if certain conditions are met. Section 121(3)(a) obliges the Court in doing so to assess the value of the benefit that is derived. These obligations are not avoided because the benefit derived from an offence is difficult to quantify. In particular, these provisions do not assume that the benefit will in all cases be capable of being determined with arithmetical precision. Hence s 122 provides that, in assessing the value of the benefit derived from the commission of the offences, the Court is to "have regard to" the matters listed in s 122(1)(a) to (e). A statutory command to "have regard to" various factors means to give weight to them as a fundamental element in making a determination (R v Hunt; ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 at 329; [1979] HCA 32.) However, it does not mean that those factors must be slavishly adopted as the qualification of the benefit. In this case, the only relevant factor that regard could be had to is that specified in s 122(1)(a), namely, "money that, because of the illegal activity, came into the possession or under the control of the person or another person".
The total CCB received by Interactive Workforce, Panacea and Teach was $10,937,416.61, $1,481,062 and $8,842,561.13. [128] Even though I am not satisfied that all of those funds were the obtained as a result of a deception I am nevertheless satisfied that, because of the illegal activity, all of those funds came under the control of Mohammad Omar and Ibrahim Omar (s 122(1)(a). This is so because I am satisfied that, but for the implementation of their fraudulent scheme which included inflating the number of child care hours provided and falsifying the qualifications of the educators, they would never had operated any FDC centres at all. They engaged in fraud on a large scale. The substantial profits they were making from that fraud were most likely far in excess of the value of any genuine services they were providing (see [84]). This was not an instance of a legitimate business engaging in some illegal activity. Instead, this was an instance of a fraudulent business model that just happened to provide some family day care now and then.
Consistent with s 122(1)(a), in assessing the value of the benefit that Mohammad Omar and Ibrahim Omar derived, I have regard to the figure of $34,415,576.50 [129] being the money that, because of their illegal activity, came under their control. I also have regard to the fact that some legitimate child care was being provided and some legitimate costs in providing that care would have been incurred. Section 121(3)(a) does not expressly address the position of two persons controlling the funds that inform the assessment of the benefit received. The Commissioner sought to allocate the benefit by reference to who out of Mohammad and Ibrahim Omar was the Director of the relevant Corporate Entity that received CCB. However, the effect of my findings is that this was a joint scheme undertaken by both of them. I consider that, in having regard to the figure of $34,415,576.50, they should ultimately be regarded as having derived the same amount of benefit. For the purposes of s 121(2)(a) of POCA, I assess the value of the benefit they derived as $15,000,000 each.
Subdivision C of Division 2 addresses amounts that are to be applied in reduction of the penalty that is to be imposed. The only provision that is presently relevant is s 130 which provides for a reduction on account of the value of the property that has been forfeited or is the subject of restraining orders (s 130). The Commissioner's submissions provided the following breakdown of the value of that property, which I accept: Assets forfeited on 17 April 2020 [130] (the April Assets) 25 Garrong Road $875.000 27 Garrong Road $800,000 Interested Party Accounts $377,685.04 $2,052,685.04

[23]

Orders

The Commissioner has sought to be heard on orders for the costs of the proceedings. Accordingly, the Court makes the following orders: (1) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against the First Defendant in the Schedule be forfeited to the Commonwealth; (2) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against the Second Defendant in the Schedule be forfeited to the Commonwealth; (3) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against the Third Defendant in the Schedule be forfeited to the Commonwealth; (4) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against the Fourth Defendant in the Schedule be forfeited to the Commonwealth; (5) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against the Fifth Defendant in the Schedule be forfeited to the Commonwealth; (6) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against the Sixth Defendant in the Schedule be forfeited to the Commonwealth; (7) Pursuant to section 47 of the Proceeds of Crime Act 2002 (Cth) the property listed against Al-Namal Family Day Care Scheme Pty Ltd in the Schedule be forfeited to the Commonwealth. (8) Pursuant to s 116(1) of the Proceeds of Crime Act 2002 (Cth), Mohammad Omar pay to the Commonwealth a pecuniary penalty of $13,003,011.30. (9) Pursuant to s 116(1) of the Proceeds of Crime Act 2002 (Cth), Ibrahim Omar pay to the Commonwealth a pecuniary penalty of $12,139,179.65; and (10) The Commissioner of the Australian Federal Police file and serve any submission on costs within 14 days hereof and that submission not exceed four pages. SCHEDULE Assets to be Forfeited Applicant Restrained Accounts Restraining Order made by Fagan J on on 8 August 2016 Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account: • 062175 10092942 held in the name of Ibrahim Omar. • 219150144786 held in the name of Ibrahim Samir Omar. • 062191 10792543 held in the name of Surpass Australia Pty Ltd. First Defendant (Ibrahim Omar) • 062191 10800590 held in the name of Surpass Australia Pty Ltd. 11, 12, 14, 22 • 062000 16322975 held in the name of Surpass Australia Pty Ltd. • 062191 10818133 held in the name of Teach Australia Group Pty Ltd. • 062000 16322908 held in the name of Teach Australia Group Pty Ltd. Funds standing to the credit of Bankwest account 162 054250 3 held in the name of Surpass Australia Pty Ltd, together with any interest earned on that account. Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account. • 062175 10033096 held in the name of Mohammad Omar • 062692 24303758 held in the name of Mohammad Omar. • 062692 21895540 held in the name of Mohammad Omar. Second Defendant (Mohammad Omar) • 062191 50144591 held in the name of Mohammad Omar. 10, 13, 15, 18, 21 • 062191 10865925 held in the name of Interactive Workforce Solutions Pty Ltd. • 062191 10799382 held in the name of Interactive Workforce Solutions Pty Ltd. • 062191 10865933 held in the name of Panacea Enterprises Pty Ltd. • 062191 10726888 held in the name of Panacea Enterprises Pty Ltd. Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account • 062191 10792543 held in the name of Surpass Australia Pty Ltd. Third Defendant (Surpass Australia) • 062191 10800590 held in the name of Surpass Australia Pty Ltd. 12, 23, 22 • 062000 16322975 held in the name of Surpass Australia Pty Ltd. Funds standing to the credit of Bankwest account 162 054250 3 held in the name of Surpass Australia Pty Ltd, together with any interest earned on that account. Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account. Fourth Defendant (Interactive Workforce Solutions) • 062191 10865925 held in the name of Interactive Workforce Solutions Pty Ltd. 13, 24 • 062191 10799382 held in the name of Interactive Workforce Solutions Pty Ltd. Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account. Fifth Defendant (Teach Australia Group) • 062191 10818133 held in the name of Teach Australia Group Pty Ltd. 14, 25 • 062000 16322908 held in the name of Teach Australia Group Pty Ltd. Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account. Sixth Defendant (Panacea Enterprises) • 062191 10865933 held in the name of Panacea Enterprises Pty Ltd. 15, 26 • 062191 10726888 held in the name of Panacea Enterprises Pty Ltd. Funds standing to the credit of the following Commonwealth Bank of Australia accounts together with any interest earned on that account. Al-Namal Family Day Care Scheme Pty Ltd (Al Namal) • 062191 10865845 held in the name of Al-Namal Family Day Care Scheme Pty Ltd. 16 • 062191 10865853 held in the name of Al-Namal Family Day Care Scheme Pty Ltd. • 062 191 10882047 held in the name of Al-Namal Family Day Care Scheme Pty Ltd.

[24]

Endnotes

Commissioner's Outline of Submission, Abridged Court Book ("ACB"), Tab 2 at [10].
Commissioner's Outline of Submissions at [53] and [65].
Commissioner's Outline of Submissions at 10 to (d).
Commissioner's Outline of Submissions at [11].
The "National Law" was a schedule to the Education and Care Services National Law Act 2010 (Vic). It was made applicable to NSW by the Children (Education and Care Services National Law Application Act 2010.
Affidavit of Agnes Bishop sworn 24 September 2020, "Bishop Affidavit", ACB Tab 16 at [5] to [8].
See ss 10 to 20.
See s 44(1)(d) in the National Law as set out in the schedule to the Education and Care Services National Law Act 2010 (Vic).
See clause 3 of the Children (Education and Care Services) Supplementary Provisions Regulation 2019 and s 301f of the Education and Care Services National Law Act 2010 (Vic).
Now repealed.
Bishop Affidavit at [26].
Bishop Affidavit at [27].
Bishop Affidavit at [28].
Affidavit of Sonja Marte sworn 22 July 2020, "Marte Affidavit", ACB Tab 29 at [10].
Marte Affidavit at [13].
Marte Affidavit at [18].
Marte Affidavit at [22(b)].
Marte Affidavit at [17].
Affidavit of Scott Michael Mathews sworn 26 July 2020, "Mathews July 2020 Affidavit", ACB Tab 14 at [9] to [10].
Affidavit of Scott Michael Mathews sworn 25 February 2019, "Mathews February 2019 Affidavit", ACB Tab 13 at 697.
Bishop Affidavit at ACB 4011.
Bishop Affidavit at ACB 4013-14.
Bishop Affidavit at ACB 4070.
Bishop Affidavit at ACB 3965.
Bishop Affidavit at ACB 3966.
Bishop Affidavit at ACB 3970.
Bishop Affidavit at ACB 3971-72.
Bishop Affidavit at ACB 3974.
Bishop Affidavit at ACB 4092.
Bishop Affidavit at ACB 4103.
Bishop Affidavit at ACB 4111.
Bishop Affidavit at ACB 4118.
Bishop Affidavit at ACB 4128.
Bishop Affidavit at ACB 4134.
Bishop Affidavit at ACB 4137.
Bishop Affidavit at ACB 3987.
Bishop Affidavit at ACB 3991.
Bishop Affidavit at [79].
Bishop Affidavit at ACB 4138.
Bishop Affidavit at ACB 4149-51.
Bishop Affidavit at ACB 4155.
Affidavit of Elizabeth Mary Russo sworn 23 July 2020, ACB Tab 24 at [8].
ACB Tab 27.
ACB Tab 17.
Mathews February 2019 Affidavit at [435]; CB 695.
Marte Affidavit at [41].
CB 5508.
Marte Affidavit at [42].
CB 5503.
Marte Affidavit at [44].
Affidavit of Dawaiyan Deb sworn 23 July 2020, "Deb Affidavit", ACB Tab 23 at [46].
Mathews July 2020 Affidavit at [11] to [12].
Bishop Affidavit at [82].
Bishop Affidavit at ACB 4168.
Bishop Affidavit at ACB 4171 to 4178.
CB 4178.
Bishop Affidavit at ACB 4181.
Bishop Affidavit at ACB 4184.
Bishop Affidavit at ACB 4194.
Bishop Affidavit at ACB 4192.
Bishop Affidavit at ACB 4196.
Marte Affidavit at [49]; CB 5562.
CB 5569.
CB 5572.
CB 5577.
CB 5581.
Marte Affidavit at [52].
Deb Affidavit at [44].
Commissioner's Supplementary Submissions at [8].
CB 1798 to 1799.
CB 1833.
CB 1834.
Mathews July 2020 Affidavit at [15] to [16].
Bishop Affidavit at [88] to [89], ACB 4200 to 4207.
Bishop Affidavit at ACB 4212.
Bishop Affidavit at [90], ACB 4239.
Bishop Affidavit at ACB 4242.
Bishop Affidavit at ACB 4245.
Bishop Affidavit at ACB 4245.
Bishop Affidavit at ACB 4247.
Marte Affidavit at 39; CB 5458.
CB 5489.
Deb Affidavit at [42]; ACB Tab 23.
Bishop Affidavit at [69], ACB 4071.
Bishop Affidavit at ACB 4081, 4085.
Bishop Affidavit at ACB 4088.
Commissioner's Supplementary Submissions at [12].
Mathews July 2020 Affidavit at ACB 2354.
Bishop Affidavit at ACB 4250 (Tab 30).
Bishop Affidavit at ACB 4246 (Tab 31).
Bishop affidavit at ACB 4273.
Bishop Affidavit at ACB 4276.
Bishop Affidavit at ACB 4285.
Bishop Affidavit at ACB 4283-84.
Bishop Affidavit at ACB 4287.
CB 5526.
CB 5542.
CB 5561.
Deb Affidavit at [40].
Bishop Affidavit at ACB 4298.
Commissioner's Submissions at [44].
Deb Affidavit at [15] to [26].
Affidavit of James Bales sworn 23 July 2020, Tab 25 at [13]ff.
At CB 5213.
Affidavit of Andrew Cowie affirmed 24 July 2020, "Cowie Affidavit", ACB Tab 18 at [22] to [26].
Cowie Affidavit, AC-1 at 86.
Affidavit of Bernadette Teresse Massih sworn 27 July 2020, "Massih Affidavit", ACB Tab 20 at [17].
Massih Affidavit at [20].
Massih Affidavit at [28].
Affidavit of Ashley Sophia Yarza sworn 24 July 2020, "Varza Affidavit", Tab 19 at [26ff].
Varza Affidavit at [18].
Commissioner's Submissions at [56].
Citing Affidavit of Scott Mathews affirmed 4 August 2016, "Mathews August 2016 Affidavit" at Tab 11 at [119]-[120] (Fadi Kheir); [124]-[125] (Mohamed Fachikh); [132]-[137] (Rebecca Sarkis); [156]-[162] (Ahmed Charafeddine); [175]-[176] (Mohammed Nagi); [182]-[183] (Susan Yatim), Mathews February 2019 Affidavit at [37]-[38] (unknown educator); [42]-[43] (Harun Harace); [47]-[48] (unknown educator); [52]-[53] (Genwa Kebbara); [60]-[61] (Amenah Alameddine); [70]-[71] (Afaf Osman); [92]-[93] (Mohammed Nagi).
Citing Mathews August 2016 Affidavit at [141] to [142] (Kamal El-Masri).
Cowie Affidavit at [26].
See Exhibit SM-7, Tab 6 to the Affidavit of Scott Michael Mathews affirmed 22 September 2020 "Mathews September 2020 Affidavit", (Omar Akbari, Talal Khayat).
Exhibit SM-7, Tab 6 to Mathews September 2020 Affidavit, "EDU-OP R-45 Play School FDC - All Sessions (9 Nov 2018)" (Tayal Khayat).
Yarza Affidavit at [24].
Massih Affidavit at [30].
Massih Affidavit at [46].
Massih Affidavit at [22] to [23].
Massih Affidavit at [24].
Commissioner's Outline of Submissions at [66].
Massih Affidavit at [40].
Mathews July 2020 Affidavit at [17].
Commissioner's Outline of Submissions at [77].
See CB 5132 at Tab 6 to the Deb Affidavit.
$9,072,439.63 less $229,878.50.
$13,154,536.79 (Surpass) + $10,937,416.61 + $1,481,602 + $8,842,561.13.
See Commissioner of AFP v Omar [2020] NSWSC 418.
See Commissioner of AFP v Omar [2020] NSWSC 1944.
See Commissioner of AFP v Omar [2020] NSWSC 1944.
$15,000,000.00 - $1,026,342.52 - $970,646.18.
$15,000,000.00 - $1,026,342.52 - $1,834,477.83. 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: 14 April 2021

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