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District Court 16 July 2020

R v Nguyen

[2020] NSWDC 367

Fraud & dishonesty
MONEY LAUNDERING

Citation: R v Nguyen [2020] NSWDC 367
Court: District Court of New South Wales
Date: 16 July 2020
Judge: Mahony SC DCJ

Background

The offender was convicted by jury of possessing money reasonably suspected to be proceeds of crime, contrary to section 400.9(1) of the Criminal Code 1995 (Cth). The offence carries a maximum penalty of three years' imprisonment, or 180 penalty units, or both.

On 23 February 2019, the offender returned from Vietnam to her rented unit in Bankstown. When Australian Federal Police arrived to execute a search warrant at around 2pm, the offender and the unit's owner were observed walking back into the premises from the backyard. A neighbour then reported that a cardboard box containing a large quantity of cash had appeared in her courtyard, alongside a Nike backpack and a Woolworths shopping bag. The offender's fingerprint was found on the shopping bag. The total amount of money recovered was $596,090.

The matter proceeded to a sentence hearing after the jury returned its guilty verdict. The co-offender, the unit's owner Mr Le, had pleaded guilty separately to a concealment offence under the same provision and had given evidence for the Crown at trial.

Legal Issues

  • What was the appropriate objective seriousness of the offending for sentencing purposes under section 400.9(1)?
  • How should the principles of general and specific deterrence be weighted in sentencing for money laundering offences?
  • Whether the offender had a higher level of culpability than the co-offender Mr Le, and how the parity principle applied?
  • Whether COVID-19 conditions in custody warranted a non-custodial sentence or an Intensive Correction Order instead of full-time imprisonment?
  • What sentence was appropriate having regard to the mandatory sentencing considerations in section 16A(2) of the Crimes Act 1914 (Cth)?

Decision

Objective seriousness and nature of the offence:

The court characterised the offending as serious and placed it at the mid-range of objective seriousness for a section 400.9(1) offence, though at the lower end of that mid-range (at [53]). The amount of $596,090 was almost six times the statutory threshold of $100,000, and possession of the money itself indicated a role in facilitating money laundering, even though the precise nature of that role and the source of the funds could not be established (at [53]). The court affirmed that money laundering offences are not victimless crimes, as they underpin organised criminal activity and consume significant public resources to investigate and prosecute (at [54]).

Deterrence:

Both general and specific deterrence were treated as paramount considerations (at [56]). The court accepted the Crown's submission that the difficulty in detecting, investigating, and prosecuting money laundering offences means that general deterrence must feature prominently in sentencing (at [56]). The absence of remorse, the offender's continued denial of knowledge of the offence, and the inference that she was acting for profit meant that specific deterrence also carried significant weight (at [56]).

Parity with the co-offender:

The court found that the offender's culpability was higher than that of Mr Le (at [59]). Conviction for possession carried a greater degree of culpability than Mr Le's conviction for concealment under the same provision (at [50], [59]). The court rejected the submission that the Crown had failed to conduct a proper assessment of Mr Le's credibility before calling him as a witness, distinguishing the circumstances from those considered in R v Kneebone, because Mr Le was called and was available for cross-examination (at [59]). Mr Le also had the benefit of a 40% utilitarian discount for his plea of guilty and assistance to authorities, which the offender did not receive (at [60]).

COVID-19 and the nature of the sentence:

The court was not persuaded that the impact of COVID-19 on prison conditions justified a non-custodial penalty or an Intensive Correction Order (at [61]). The court noted that no general sentencing principle had yet emerged from the COVID-19 pandemic, though the Court of Criminal Appeal had acknowledged in Valentine v R [2020] NSWCCA 116 that steps taken by Corrective Services had negatively affected inmates' wellbeing (at [61]). The adverse custodial conditions, including potential periods of solitary confinement and restricted access to programs and visitors, were taken into account in setting the recognizance release period rather than as a basis to avoid custody altogether (at [62]).

Orders Made

  • The offender was convicted of possessing money reasonably suspected of being proceeds of crime contrary to section 400.9(1) of the Criminal Code 1995 (Cth), the value of the money being $100,000 or more.
  • The offender was sentenced to imprisonment for 1 year and 8 months.
  • A Recognizance Release Order was made requiring the offender to be released after 10 months (on 15 May 2021), without security, for a period of 10 months.

Key Takeaways

  • Possession of proceeds of crime under section 400.9(1) of the Criminal Code 1995 (Cth) carries a higher degree of culpability than concealment under the same provision, which is a relevant distinction when applying the parity principle to co-offenders sentenced for related but differently characterised conduct (at [50], [59]).

  • General deterrence is a paramount sentencing consideration for money laundering offences because such offending is inherently difficult to detect, investigate, and prosecute, and because it underpins organised criminal activity (at [56]).

  • A large sum significantly exceeding the statutory threshold is itself indicative of a meaningful role in a money laundering enterprise, even where no direct evidence exists about the offender's place in the broader criminal organisation or the source of the funds (at [53]).

  • The District Court declined to treat COVID-19 prison conditions as a basis for substituting a community-based order for full-time imprisonment, though the adverse conditions were taken into account when fixing the recognizance release period (at [61]-[62]).

  • Where a Crown witness has been called and subjected to cross-examination at trial, a failure by the prosecution to conduct a pre-trial credibility assessment of that witness does not constitute the kind of procedural failing addressed in R v Kneebone (at [59]).

Legislation and Cases Referenced

Legislation
- Crimes Act 1914 (Cth)
- Crimes (Sentencing Procedure) Act 1999
- Criminal Code 1995 (Cth)
- Evidence Act 1995

Cases
- Ansari v R [2007] NSWCCA 204
- R v Jiao [2015] NSWCCA 95
- R v Kneebone (1999) 47 NSWLR 450; [1999] NSWCCA 279
- R v Lin [2014] NSWCCA 254
- Valentine v R [2020] NSWCCA 116