Citation: R v Kennedy [2019] NSWDC 359
Court: District Court of New South Wales
Date: 19 July 2019
Judge(s): Weber SC DCJ
Background
The offender was an accountant who, over an eight-year period, defrauded multiple clients and a family business through a series of dishonest schemes. He induced clients to hand over large sums of money by falsely representing that he would invest the funds with Macquarie Bank at attractive interest rates. The money was never invested; it was retained by the offender.
A separate scheme involved the offender's role as accountant for a furniture company and members of its founding family. He falsified Business Activity Statements and Investment Activity Statements so that tax payments were redirected to accounts he controlled rather than to the ATO. He also fabricated a capital gains tax liability to extract a further large sum, which he diverted to a related entity and then claimed as an ATO refund.
In total, the agreed loss to victims across all three indictments was $4,693,621.50. The offender pleaded guilty to eight counts of dishonestly obtaining a financial advantage by deception (under both the current and repealed versions of the relevant provisions), with a ninth offence taken into account on a Form 1 basis.
Legal Issues
- What sentence was appropriate given the number of offences, the total loss, and the multiple victims?
- What guilty plea discounts applied, and at what rate, for pleas entered at different stages of proceedings?
- What weight should be given to the various aggravating factors, including criminal history, abuse of trust, planning, and multiple victims?
- Was an aggregate sentence the appropriate sentencing mechanism, and how should accumulation, concurrence, and totality be applied?
- Were special circumstances established to warrant a variation to the standard non-parole period ratio?
Decision
Weber SC DCJ assessed the objective seriousness of the offending as falling in the upper range. The judge identified multiple significant aggravating factors: the offender had a considerable prior criminal record including for similar offences; the total loss was substantial at nearly $4.7 million; he abused his position of trust as an accountant; the offending involved multiple victims across a long period; and many of the acts involved a degree of planning and sophistication.
On guilty plea discounts, the judge applied 25% to the counts in the two later indictments, where pleas were entered early in the Local Court. For the counts in the first indictment, where pleas were entered after the matters were listed for trial in the District Court, the judge accepted the offender's submission and applied a 15% discount rather than the 10% urged by the Crown. The judge accepted the principle, drawn from an earlier Court of Criminal Appeal decision, that white-collar crime can warrant greater leniency for a plea because detection, investigation, and proof are particularly difficult and expensive.
The judge declined to find special circumstances that would justify varying the standard non-parole period ratio. The offender was of advanced age and had low prospects of rehabilitation, with a high risk of reoffending assessed. An aggregate sentence was considered the most appropriate vehicle to accommodate the competing requirements of partial accumulation, concurrence, and the totality principle across the three indictments and eight counts.
Orders Made
- The offender was convicted on each count in all three indictments.
- An aggregate sentence of 7 years imprisonment was imposed, with a non-parole period of 5 years and 3 months.
- The sentence commenced on 31 May 2019, with the non-parole period expiring on 30 August 2024 and the balance of the sentence expiring on 30 May 2026.
Key Takeaways
- The District Court applied a higher guilty plea discount (15%) for white-collar fraud matters than the Crown sought (10%), accepting that the complexity and expense of proving such offences is a relevant consideration when quantifying the utilitarian value of a plea.
- A conviction for repeated fraud by an accountant, involving a prolonged abuse of professional trust, multiple victims, and losses approaching $4.7 million, attracted an aggregate head sentence of 7 years in the upper range of objective seriousness.
- Where multiple indictments and numerous counts are involved, an aggregate sentence under section 53A of the Crimes (Sentencing Procedure) Act 1999 (NSW) can be the appropriate mechanism to balance accumulation, concurrence, and totality in a single coherent structure.
- Aggravating factors such as a prior record for similar offending, sophisticated planning, and abuse of a position of trust collectively pushed the sentencing assessment firmly toward the upper range, regardless of the guilty pleas entered.
- No special circumstances were found, notwithstanding the offender's advanced age, where low rehabilitation prospects and a high reoffending risk were also present.
Legislation and Cases Referenced
Legislation:
- Crimes Act 1900 (NSW), ss 178BA(1), 192E(1)(b)
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 33, 47, 53A
Cases:
- Azzopardi v The Queen [2011] VSCA 372
- Baumer v The Queen (1988) 166 CLR 51
- Elyard v Regina [2006] NSWCCA 43
- Jeffree v Regina [2017] NSWCCA 72
- Markarian v R (2005) 228 CLR 357
- Mill v The Queen (1988) 166 CLR 59
- Pearce v The Queen (1998) 194 CLR 610
- R v El-Rashid (unrep, 7/4/95, NSWCCA)
- R v Finnie [2002] NSWCCA 533
- R v Halabi (unrep, 17 February 1992, NSWCCA)
- R v Harris (2007) 171 A Crim R 267
- R v Hawkins (1989) 45 A Crim R 430
- R v Mille (unrep, 1/5/98, NSWCCA)
- R v Mungomery (2004) 151 A Crim R 376
- R v Murtaza [2001] NSWCCA 336
- R v Pont (2000) 121 A Crim R 302
- R v Sellen (unrep, 5/12/91, NSWCCA)
- R v Todorovic [2008] NSWCCA 49
- R v Wilson [2005] NSWCCA 219
- R v Woodman [2001] NSWCCA 310