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Supreme Court 27 September 2017

R v Jousif; R v I Elomar; R v M Elomar

[2017] NSWSC 1299

Fraud & dishonesty
CRIMINAL LAW SENTENCING THIRD OFFENDER WAS GO BETWEEN AND FACILITATOR STATUTORY CONSTRUCTION

Citation: R v Jousif; R v I Elomar; R v M Elomar [2017] NSWSC 1299
Court: Supreme Court of New South Wales
Date: 27 September 2017
Judge: Adamson J

Background

Three offenders pleaded guilty to conspiring to bribe an Iraqi public official, contrary to ss 11.5(1) and 70.2(1) of the Criminal Code Act 1995 (Cth). The conspiracy was alleged to have occurred between July 2014 and February 2015, with the conduct centred in Sydney and extending internationally.

Two of the offenders were brothers who served as directors and equal shareholders of an Australian engineering, infrastructure and construction company. Their business had experienced a significant decline in the years leading up to the offending, and they were actively seeking new opportunities in Iraq. The third offender was an Australian-resident Iraqi citizen who acted as a go-between and facilitator, introducing the brothers to contacts in Baghdad.

The conspiracy involved the transfer of US$1 million to Iraq for the purpose of bribing a foreign public official, with the intention of obtaining government infrastructure contracts. The matter came to light through an Australian Federal Police investigation commencing in March 2014, which produced extensive evidence via telephone interception and search warrants.

  • What is the proper approach to sentencing for the offence of conspiring to bribe a foreign public official under ss 11.5 and 70.2 of the Criminal Code Act 1995 (Cth), including the purpose of the legislation and the significance of the maximum penalty?
  • How should the respective culpability of the three offenders be assessed, given their different roles in the conspiracy?
  • What weight should be given to mitigating factors, including guilty pleas, personal circumstances, and the absence of comparable sentencing precedents?
  • Whether fines were appropriate in addition to imprisonment, and if so, for which offenders?
  • What non-parole periods were appropriate for each offender, given that there is no fixed ratio between non-parole and head sentence for Commonwealth offences?

Decision

Adamson J sentenced each offender to four years' imprisonment, with a non-parole period of two years. The Court approached the sentencing task by reference to the purposes underlying the foreign bribery provisions, noting that Australia's legislative framework was introduced following ratification of the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. The maximum penalty for the substantive offence is ten years' imprisonment and/or a fine of 10,000 penalty units (approximately $1.7 million at the time), and the same maximum applies to the conspiracy offence by operation of s 11.5(1).

The two director-brothers were treated as bearing the primary responsibility for the offending, as the principals of the company that stood to benefit commercially. Adamson J imposed fines of $250,000 on each of them, in addition to imprisonment, reflecting their financial motivation and the means available to them. The third offender, as the facilitator and go-between, was also sentenced to four years' imprisonment, but no fine was imposed on him, as the Court was not satisfied he had the means to pay.

The Court acknowledged the absence of closely comparable sentencing precedents for this specific offence. One prior sentence for the same offence was drawn to the Court's attention, but Adamson J agreed with both Crown and defence that it was not comparable, and declined to analyse it further, noting that previously decided cases have only limited value in the sentencing exercise for Commonwealth offences.

Adverse facts were applied only where established beyond reasonable doubt, consistent with the principles in The Queen v Olbrich (1999). Mitigating factors, including guilty pleas and personal circumstances, were taken into account where established on the balance of probabilities or conceded by the Crown.

Orders Made

  • John Jousif: Convicted. Sentenced to four years' imprisonment commencing 25 September 2017, expiring 24 September 2021. Non-parole period of two years, expiring 24 September 2019. No fine imposed.
  • Ibrahim Elomar: Convicted. Sentenced to four years' imprisonment commencing 27 September 2017, expiring 26 September 2021. Non-parole period of two years, expiring 26 September 2019. First eligible for parole 26 September 2019. Fine of $250,000 imposed.
  • Mamdouh Elomar: Convicted. Sentenced to four years' imprisonment commencing 27 September 2017, expiring 26 September 2021. Non-parole period of two years, expiring 26 September 2019. First eligible for parole 26 September 2019. Fine of $250,000 imposed.

Key Takeaways

  • The Supreme Court confirmed that the foreign bribery offence under s 70.2 of the Criminal Code Act 1995 (Cth) carries the same maximum penalty as the domestic offence of bribing a Commonwealth official, reflecting Parliament's intention to treat both categories of corruption with equivalent seriousness.

  • Culpability between co-offenders in a bribery conspiracy can differ materially based on role: the principals who stood to gain the business benefit were treated as more culpable than the facilitator, even where identical head sentences were imposed.

  • Under Power v The Queen (1974) and Hili v The Queen; Jones v The Queen (2010), there is no fixed or "normal" ratio between the non-parole period and the total sentence for Commonwealth offences; the non-parole period is determined by what, in all the circumstances, ought to be the minimum period of actual incarceration.

  • Financial penalties can be imposed alongside custodial sentences for this offence, but the sentencing court declined to impose a fine on the facilitator where there was no evidence of sufficient means to pay, distinguishing that position from the director-offenders whose motive was commercial gain.

  • Comparable precedents for foreign bribery sentences were effectively unavailable, underscoring the novelty of prosecuted cases under these provisions and the limited guidance that prior cases can offer in this area.

Legislation and Cases Referenced

Legislation:
- Criminal Code Act 1995 (Cth), ss 11.5, 70.1, 70.2, 70.3, 141.1
- Crimes Act 1914 (Cth), ss 16A, 16C, 16E, 16F, 17A, 19AC, 19B, 20, 20AB
- Crimes (Sentencing Procedure) Act 1999 (NSW)
- Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999 (Cth)
- Crimes Legislation Amendment (Powers, Offences and Other Measures) Act 2015 (Cth)
- Acts Interpretation Act 1901 (Cth), ss 15AA, 15AB
- Proceeds of Crime Act 2002 (Cth)

Key Cases:
- The Queen v Olbrich (1999) 199 CLR 270; [1999] HCA 54
- Hili v The Queen; Jones v The Queen (2010) 242 CLR 520; [2010] HCA 45
- Power v The Queen (1974) 131 CLR 623; [1974] HCA 26
- Weininger v The Queen (2003) 212 CLR 629; [2003] HCA 14
- Cameron v The Queen (2002) 209 CLR 339; [2002] HCA 6
- Ryan v The Queen (2001) 206 CLR 267; [2001] HCA 21
- Savvas v The Queen (1995) 183 CLR 1; [1995] HCA 29