AI-generated summaries. Not legal advice. Always verify against the official judgment on NSW Caselaw.
← All decisions
8
Court of Criminal Appeal 15 May 2014

R v Ly

[2014] NSWCCA 78

Also reported as (2014) 241 A Crim R 192
Fraud & dishonesty
CRIMINAL LAW CROWN APPEAL AGAINST SENTENCE FEDERAL OFFENDER PAROLE PERIOD OF 2 YEARS 4 MONTHS COMPARISON WITH COMPARABLE CASES VIRTUALLY NO MITIGATING CIRCUMSTANCES

Citation: R v Ly [2014] NSWCCA 78
Court: NSW Court of Criminal Appeal
Date: 15 May 2014
Judges: Leeming JA; Hall J; Schmidt J

Background

The respondent was convicted by a jury after a 20-day trial of dealing with proceeds of crime valued at $100,000 or more, contrary to s 400.4(1) of the Criminal Code Act 1995 (Cth). The offence carried a maximum penalty of 20 years imprisonment. The conviction arose from a sustained scheme in which the respondent used the stolen identities and tax file numbers of 21 taxpayers to lodge 24 false income tax returns with the Australian Taxation Office, causing refunds totalling $357,568 to be paid into seven bank accounts she controlled. The scheme ran for approximately ten months in 2008.

The respondent spent the fraudulently obtained funds to support what the sentencing judge described as an "extravagant" lifestyle, including directing a significant portion towards credit card debts. Voice recordings retained by the ATO, together with expert evidence, identified the respondent as the person who lodged nine of the returns by telephone, including instances where she disguised her voice to match the gender of male taxpayers whose identities she had stolen.

At first instance, the District Court sentenced the respondent to 3 years and 6 months imprisonment with a non-parole period of 2 years and 4 months. The Commonwealth Director of Public Prosecutions appealed on the ground that the sentence was manifestly inadequate.

  • Whether the sentence imposed at first instance was manifestly inadequate in all the circumstances.
  • How the federal money laundering provisions under s 400.4(1) of the Criminal Code Act 1995 (Cth) operate, including the applicable maximum penalty and the relevance of the offender's role in the underlying predicate fraud.
  • The weight to be given to subjective mitigating factors, including a psychologist's report linking the offending to pathological gambling, substance dependence, and depression.
  • The application of Elias v The Queen [2013] HCA 31 to the sentencing exercise, including comparison with comparable cases.
  • The exercise of the Court's residual discretion in a Crown appeal.

Decision

The Court of Criminal Appeal found that the original sentence was manifestly inadequate. The Court noted the offence was committed over ten months, involved a deliberate and sophisticated pattern of offending, resulted in a substantial financial benefit to the respondent, and caused severe financial harm to 21 victims whose affairs remained entangled for years. The Court characterised the objective seriousness of the offending as somewhat above the mid-range.

The Court assessed the subjective case as providing virtually no meaningful mitigation. The sentencing judge had already afforded limited weight to the psychologist's report, noting that the removal of the respondent's children from her care occurred eight months after the offending concluded, and that other adverse life circumstances post-dated the offence. The Court agreed those factors could not significantly explain or mitigate the sustained criminal conduct.

Applying the sentencing principles applicable to federal offenders under s 16A of the Crimes Act 1914 (Cth), and drawing on comparable cases, the Court concluded that the original sentence fell so far short of what was warranted as to constitute error. The Court also noted there was no basis to decline to exercise the residual discretion, given the promptness of the Crown appeal. The respondent was resentenced to 8 years imprisonment.

Orders Made

  • Appeal allowed.
  • The sentence imposed by the District Court in respect of the s 400.4(1) offence was set aside.
  • The respondent was resentenced to 8 years imprisonment commencing 2 November 2012 and expiring 1 November 2020, with a non-parole period of 4 years and 6 months expiring 1 May 2017.
  • The earliest date for the respondent's release on parole was set at 1 May 2017.

(Note: The orders were subsequently amended pursuant to the slip rule, as recorded in R v Ly (No 2) [2014] NSWCCA 91.)

Key Takeaways

  • The Court of Criminal Appeal more than doubled the original sentence, from 3 years 6 months to 8 years, reflecting the gravity of sustained, deliberate money laundering involving identity theft and substantial harm to multiple victims.
  • Where a respondent is the principal offender and sole beneficiary of a sophisticated fraud scheme, the underlying predicate offending is relevant to sentencing even where it does not form a separate count, bearing on objective seriousness and the degree of the offender's belief that the funds were proceeds of crime.
  • Subjective factors, including psychological reports linking offending to mental health conditions, carry limited weight where the conditions post-date or are otherwise temporally disconnected from the period of criminal conduct.
  • Under s 400.4(1) of the Criminal Code Act 1995 (Cth), the maximum penalty of 20 years imprisonment reflects Parliament's assessment of the serious nature of intentional money laundering, and comparable case law informs where a particular offender's conduct sits within that range.
  • In Crown appeals, the Court of Criminal Appeal retains a residual discretion to decline to resentence even where error is established, but a promptly filed appeal with no countervailing factors will ordinarily result in that discretion being exercised in favour of resentencing.

Legislation and Cases Referenced

Legislation:
- Criminal Code Act 1995 (Cth), s 400.4(1) and (2)
- Crimes Act 1914 (Cth), ss 16A, 17A, 21B
- Criminal Appeal Act 1912 (NSW), s 5D
- Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth), s 53
- Financial Transaction Reports Act 1988 (Cth), s 31

Cases:
- Elias v The Queen; Issa v The Queen [2013] HCA 31; 248 CLR 483
- Barbaro v The Queen [2014] HCA 2
- Bugmy v The Queen [2013] HCA 27; (2013) 302 ALR 192
- Hili v The Queen; Jones v The Queen [2010] HCA 45; 242 CLR 520
- Green v The Queen [2011] HCA 49; (2011) 244 CLR 462
- Markarian v R [2005] HCA 25; (2005) 228 CLR 357
- Director of Public Prosecutions (Cth) v De La Rosa [2010] NSWCCA 194; 79 NSWLR 1
- House v The King (1936) 55 CLR 499
- Lowndes v R [1999] HCA 29; 195 CLR 665
- R v Ansari [2007] NSWCCA 204; 70 NSWLR 89
- R v Wing Cheong Li [2010] NSWCCA 125; 202 A Crim R 195
- R v Huang; R v Siu [2007] NSWCCA 259; 174 A Crim R 370
- Jimmy v R [2010] NSWCCA 60; 269 ALR 115
- Dinsdale v The Queen [2000] HCA 54; 202 CLR 321