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District Court 1 March 2013

R v Russo

[2013] NSWDC 47

Fraud & dishonesty
CRIMINAL LAW SENTENCE FORM 1 CORRUPTLY GIVING A BENEFIT TO AN AGENT PERFORMANCE ENCHANCING SUBSTANES TROTTING INDUSTRY

Citation: R v Russo [2013] NSWDC 47
Court: District Court of New South Wales
Date: 1 March 2013
Judge(s): Berman SC DCJ

Background

The offender, a harness racing trainer, engaged in a course of corrupt conduct across nine charged occasions between February 2010 and August 2011. On each occasion, he paid or offered to pay cash to harness racing stewards so that horses he was associated with would not be subjected to pre-race drug testing.

The purpose of avoiding testing was to conceal the administration of performance-enhancing substances to those horses. The primary substance was bicarbonate of soda, administered by drenching directly into the horse's stomach via a nasal tube. This process, known colloquially as a "milkshake," elevates carbon dioxide levels in the horse and reduces fatigue during racing. On some occasions, the conduct also concealed the presence of painkilling medication.

Two stewards received payments: Matthew Bentley and Paul O'Toole. Bentley was granted immunity from prosecution and was not charged. The offender was arrested in November 2011, pleaded guilty to nine counts of corruptly giving a benefit to an agent, and asked the court to take into account two further counts of corruptly offering to give a benefit on a Form 1 (a procedural mechanism for placing related, uncharged matters before the court at sentencing).

  • What sentence was appropriate for nine counts of corruptly giving or offering to give a benefit to a racing steward?
  • How should the principle of parity apply given that co-offenders were dealt with in the Local Court and one co-offender received immunity from prosecution entirely?
  • How should the sentences across the nine counts be structured, including the application of the totality principle and any finding of special circumstances?

Decision

Berman SC DCJ described the offending as seriously criminal conduct affecting the harness racing industry at a fundamental level. The absence of a single identifiable victim, his Honour observed, can cause the gravity of such conduct to be underestimated. In reality, the harm was diffuse: the integrity of racing was undermined and the many people who bet on races in the expectation of a fair contest were all affected.

The court applied a 25 per cent discount to reflect the offender's early guilty plea. The offender's otherwise good character, stable background, strong family ties, and genuine passion for the industry were accepted as mitigating factors. However, his Honour found that the stated motivation of reputation-building did not diminish culpability: whether the benefit sought was financial or reputational, the offender achieved it through corruption and concealment.

On the question of parity, the court declined to reduce the sentence to match those imposed on co-offenders in the Local Court. The co-offenders had committed fewer offences over a shorter period, and one had provided meaningful assistance to authorities. The immunity granted to Bentley was noted but explicitly excluded from the parity analysis, as prosecutorial decisions about immunity do not engage the parity principle.

A finding of special circumstances was made because the offender had no prior custodial experience. The court structured the sentences with partial accumulation and grouping across the nine counts to achieve an outcome consistent with the totality principle, arriving at an overall non-parole period of 15 months and a head sentence of 30 months.

Orders Made

  • Charges 2 to 5: imprisonment with a non-parole period of 9 months and a head sentence of 12 months, commencing 1 March 2013.
  • Charges 6 to 9: imprisonment with a non-parole period of 6 months and a head sentence of 12 months, commencing 1 September 2013.
  • Charge 1 (principal count, inclusive of Form 1 matters): imprisonment with a non-parole period of 3 months and a head sentence of 18 months, commencing 1 March 2014.
  • Overall: non-parole period of 15 months; head sentence of 30 months; directed release to parole on 31 May 2014.

Key Takeaways

  • Corruption involving racing stewards is treated as a serious category of offending. The District Court reinforced this position by reference to the Court of Criminal Appeal's decision in Regina v Potter [2005] NSWCCA 26, which confirmed that such conduct warrants significant custodial penalties.
  • A grant of immunity from prosecution to a co-offender does not engage the parity principle. Parity governs comparisons between sentenced offenders, not prosecutorial charging decisions.
  • Where co-offenders sentenced in a lower court committed fewer offences over a shorter period and some provided assistance to authorities, those differences can justify a materially heavier sentence without producing a justifiable sense of grievance in the offender.
  • The absence of a single identifiable victim in diffuse, industry-wide corruption does not reduce the objective seriousness of the conduct. The court expressly cautioned against underestimating harm simply because no individual complainant can be pointed to.
  • Special circumstances justifying a longer parole period can be established on the basis that the offender is experiencing custody for the first time, without any requirement to show a risk of reoffending.

Legislation and Cases Referenced

Cases:
- Regina v Potter [2005] NSWCCA 26

Legislation:
- No specific legislation was cited in the judgment text. The offences are described as "corruptly giving or offering to give a benefit to an agent." The reference to a "s 10 bond" is a reference to section 10 of the Crimes (Sentencing Procedure) Act 1999 (NSW), which permits a court to record a conviction without imposing a sentence.